3 ms·
"Every time money changes hands, GDP goes up. And every time money changes hands, that's usually becomes someone is doing something. As we've seen, that takes e
by neilwilson 4y ago
"Every time money changes hands, GDP goes up. And every time money changes hands, that's usually becomes someone is doing something. As we've seen, that takes energy. So it shouldn't come as a surprise that GDP and energy are highly correlated."
Which is where economics goes wrong. The working units are incorrect.
You'll note that economics likes to use currency as its working denomination, when the actual underlying denominations are kWh and the labour hour.
Nearly all the failures of macroeconomics can be laid at the belief that there is a one-to-one correlation between moving money around and doing stuff. There isn't and that's the problem.
The issue is similar to electrical engineers assuming that true power and apparent power are always the same.
- snapplebobapple 4y agoYou are giving way too much credit to moving money = doing stuff as the cause of failure of macro economics. There's so much wrong with macro. Check out Steve Keens' The New Econmics: A manifesto for some of the major things wrong with macro.