| Akvod said: My Macroeconomic teacher stated that the second recession was caused due to FDR wanting to listen to the Classical economists, and balancing the budget that time, cutting back government spending, engaging in contractionary policy. Also World War II in itself, was a natural Keynesian policy. It was simply a natural way, of increasing C+I+Nx+G And it's hard to use monetary policy for expansionary policy when the interest rates are near 0. But, I need to study more, if I'm going to advocate to cut back on the expansionary policies now (now that the recession ended), keep it (because unemployment is still up), or to gradually cut back on it (as AD shifts right due to C, cut back on G)
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Wow... your economics teacher should be fired. VERY FEW economists believe that to be the case. Heck these Greece crash was basically caused bt kensyian like economics. I mean, if you learned this in history class i'd understand... but economics? Awful.
It's a movement largely of laymans and polticians.
It reminds me of Freudian psychologists.
I mean heck, look at Greece to why it doesn't work.
Fruedian economics don't fix a depression faster... they smooth it's effects at the price of extending the depression.
