"Fear the Boom and Bust" a Hayek vs. Keynes Rap Anthem
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0:08 - 0:10Lord Keynes! Welcome Sir!
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0:10 - 0:11It's a Pleasure.
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0:11 - 0:12The Pleasure is all mine.
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0:12 - 0:14Your agenda?
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0:14 - 0:15That won't be necessary.
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0:15 - 0:16I am The Agenda.
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0:17 - 0:18Tell them I've arrived.
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0:18 - 0:20And then tell them, I've arrived.
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0:21 - 0:23And, your name is?
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0:24 - 0:28Hayek! F.A.Hayek!
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0:43 - 0:44[Phone ringing]
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0:44 - 0:46[Crowd chattering]
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0:47 - 0:48[Phone ringing]
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0:51 - 0:52Freddie.
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0:52 - 0:52Yup!
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0:52 - 0:53It's Keynes.
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0:53 - 0:54Hey listen, party at the Fed.
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0:54 - 0:56Already?
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0:56 - 0:5720 minutes. Lobby!
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0:57 - 0:59John Meynard Keynes.
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0:59 - 1:01F.A.Hayek
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1:01 - 1:03Yeah. We're opposed.
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1:03 - 1:06We oppose each other philosophically.
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1:06 - 1:07In the same studio.
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1:07 - 1:09We’ve been going back and forth for a century.
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1:09 - 1:11I want to steer markets.
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1:11 - 1:12I want them set free.
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1:12 - 1:15There’s a boom and bust cycle and good reason to fear it.
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1:15 - 1:16Blame low interest rates.
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1:16 - 1:17Naah! It's the animal spirits.
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1:17 - 1:19John Meynard Keynes
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1:19 - 1:21wrote the book on Modern Macro.
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1:21 - 1:23The man you need, when the economy is off track.
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1:23 - 1:26Depression, recession, now your question's in session.
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1:26 - 1:29Have a seat, and I will school you in one simple lesson.
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1:29 - 1:32Boom, 1929. The Big Crash.
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1:32 - 1:34We did it bounce bank. Economy is in the trash.
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1:34 - 1:35Persistent Unemployment.
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1:35 - 1:37The result of sticky wages.
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1:37 - 1:39Waiting for recovery? Hayek: Seriously!
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1:39 - 1:40That's outrageous.
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1:40 - 1:43I had a real plan. Any fool can understand.
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1:43 - 1:44The advice is real simple.
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1:44 - 1:46Boost aggregate demand.
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1:46 - 1:47C(Consumption), I(Investment), G(Govt. Spending)
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1:47 - 1:48Altogether gets to Y(AD).
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1:48 - 1:50Keep the total rolling and watch the economy fly
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1:50 - 1:54We have been going back N' forth for a century.
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1:54 - 1:56I want to steer markets.
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1:56 - 1:57I want them set free.
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1:57 - 1:58There is a boom and bust cycle.
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1:58 - 1:59And good reason to fear it.
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1:59 - 2:01Blame low interest rates. Keynes: Naah!
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2:01 - 2:02It's the animal spirits
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2:02 - 2:04You see, it's all about spending.
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2:04 - 2:05Hear the register cha-ching.
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2:05 - 2:08Circular flow, the dough is everything
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2:08 - 2:10So if that flow is getting low, doesn’t matter the reason.
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2:10 - 2:13We need more government spending, now it’s stimulus season
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2:13 - 2:16So forget about saving, get it straight out of your head
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2:16 - 2:19Like I said, in the long run—we’re all dead. Ohhhhhh!
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2:19 - 2:22Savings is destruction, that’s the paradox of thrift.
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2:22 - 2:25Don’t keep money in your pocket, or that growth will never lift.
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2:25 - 2:25because…
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2:25 - 2:27Business is driven by the animal spirits
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2:27 - 2:30The bull and the bear, and there’s reason to fear its......
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2:30 - 2:33effects on capital investment, income and growth
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2:33 - 2:36That’s why the state should fill the gap with stimulus both…
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2:36 - 2:38The monetary and the fiscal, they’re equally correct.
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2:38 - 2:41Public works, digging ditches, war has the same effect
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2:41 - 2:44Even a broken window helps the glass man have some wealth
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2:44 - 2:47The multiplier driving higher the economy’s health
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2:47 - 2:50And if the Central Bank’s interest rate policy tanks
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2:50 - 2:52a liquidity trap, that new money’s stuck in the banks!
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2:52 - 2:55Deficits could be the cure, you been looking for
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2:55 - 2:58Let the spending soar, now that you know the score
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2:58 - 3:01My General Theory’s made quite an impression
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3:01 - 3:03[a revolution] I transformed the econ profession
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3:03 - 3:06You know me, modesty, still I’m taking a bow
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3:06 - 3:09Say it loud, say it proud, we’re all Keynesians now
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3:09 - 3:12We’ve been goin’ back n forth for a century
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3:12 - 3:14[Keynes] I want to steer markets,
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3:14 - 3:15[Hayek] I want them set free
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3:15 - 3:18There’s a boom and bust cycle and good reason to fear it
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3:18 - 3:19[Keynes] I made my case, Freddie H
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3:19 - 3:21Listen up , Can you hear it?
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3:21 - 3:23I’ll begin in broad strokes, just like my friend Keynes
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3:23 - 3:26His theory conceals the mechanics of change,
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3:26 - 3:29That simple equation, too much aggregation
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3:29 - 3:32Ignores human action and motivation
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3:32 - 3:34And yet it continues as a justification
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3:34 - 3:37For bailouts and payoffs by pols with machinations
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3:37 - 3:38For bailouts and payoffs by pols with machinations
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3:38 - 3:40You provide them with cover to sell us a free lunch
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3:40 - 3:43Then all that we’re left with is debt, and a bunch
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3:43 - 3:46If you’re living high on that cheap credit hog
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3:46 - 3:49Don’t look for a cure from the hair of the dog
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3:49 - 3:51Real savings come first if you want to invest
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3:51 - 3:54The market coordinates time with interest
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3:54 - 3:57Your focus on spending is pushing on thread
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3:57 - 3:59In the long run, my friend, it’s your theory that’s dead
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3:59 - 4:02So sorry there, buddy, if that sounds like invective
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4:02 - 4:05Prepare to get schooled in my Austrian perspective
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4:05 - 4:08We’ve been going back and forth for a century
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4:08 - 4:10I want to steer markets,
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4:10 - 4:11I want them set free
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4:11 - 4:13There’s a boom and bust cycle and good reason to fear it
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4:13 - 4:14Blame low interest rates.
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4:14 - 4:16No… it’s the animal spirits
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4:16 - 4:19The place you should study isn’t the bust
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4:19 - 4:22It’s the boom that should make you feel leery, that’s the thrust
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4:22 - 4:24Of my theory, the capital structure is key.
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4:24 - 4:27Malinvestments wreck the economy
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4:27 - 4:30The boom gets started with an expansion of credit
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4:30 - 4:33The Fed sets rates low, are you starting to get it?
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4:33 - 4:36That new money is confused for real loanable funds
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4:36 - 4:39But it’s just inflation that’s driving the ones
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4:39 - 4:42Who invest in new projects like housing construction
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4:42 - 4:44The boom plants the seeds for its future destruction
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4:44 - 4:47The savings aren’t real, consumption’s up too
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4:47 - 4:50And the grasping for resources reveals there’s too few
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4:50 - 4:53So the boom turns to bust as the interest rates rise
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4:53 - 4:55With the costs of production, price signals were lies
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4:55 - 4:58The boom was a binge that’s a matter of fact
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4:58 - 5:01Now its devalued capital that makes up the slack.
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5:01 - 5:04Whether it’s the late twenties or two thousand and five
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5:04 - 5:07Booming bad investments, seems like they’d thrive
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5:07 - 5:09You must save to invest, don’t use the printing press
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5:09 - 5:12Or a bust will surely follow, an economy depressed
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5:12 - 5:14Your so-called “stimulus” will make things just worse.
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5:14 - 5:17It’s just more of the same, more incentives perversed
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5:17 - 5:20And that credit crunch ain’t a liquidity trap
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5:20 - 5:23Just a broke banking system, I’m done, that’s a wrap.
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5:23 - 5:26We’ve been goin’ back n forth for a century
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5:26 - 5:28I want to steer markets,
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5:28 - 5:29I want them set free
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5:29 - 5:31There’s a boom and bust cycle and good reason to fear it
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5:31 - 5:33Blame low interest rates.
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5:33 - 5:35No it’s the animal spirits
- Title:
- "Fear the Boom and Bust" a Hayek vs. Keynes Rap Anthem
- Description:
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Econstories.tv is a place to learn about the economic way of thinking through the eyes of creative director John Papola and creative economist Russ Roberts.
In Fear the Boom and Bust, John Maynard Keynes and F. A. Hayek, two of the great economists of the 20th century, come back to life to attend an economics conference on the economic crisis. Before the conference begins, and at the insistence of Lord Keynes, they go out for a night on the town and sing about why there's a "boom and bust" cycle in modern economies and good reason to fear it.
Get the full lyrics, story and free download of the song in high quality MP3 and AAC files at:
http://www.econstories.tv
Plus, to see and hear more from the stars of Fear the Boom and Bust, Billy Scafuri and Adam Lustick, visit their site: http://www.billyandadam.com
Music was produced by Jack Bradley at Blackboard3 Music and Sound Design. It was composed and performed by Richard Royston Jacobs.
http://www.blackboard3.com**Charging Bull© Arturo DiModica, 1998
- Video Language:
- English
- Duration:
- 07:33
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