https://www.nytimes.com/2026/10/23/business/economy-2008-financial-crisis.html?smid=nytcore-ios-share Not sure everyone will be able to access the link. Including for those who can. This New York Times article talks about the possibility that the AI investment cycle is going to turn down (implode) and it could cause global financial problems. It sounds an awful lot like Steve’s point that private credit/debt is part of the money supply and removing a lot of money from the economy can cause a recession or a crisis. Of course, the article doesn’t talk about the mechanism. It talks in terms of probabilities, looking at past events. But still, it’s refreshing to see mainstream media with some notion of bubbles and recession tied to bursting of bubbles. In this case, a private debt bubble. If in fact the AI bubble does burst catastrophically, it seems like it could be a good example for Steve to use in making his case. Especially good if the crisis could be predicted based on his analysis.

hi guys, i ran across this video comparing four schools of economic thought and what they would say about the great recession (aka financial crisis). it's funny because it unconsciously captures how lost the schools are with an analogy of blind men touching an elephant. check it out! https://mru.org/courses/principles-economics-macroeconomics/business-cycles-great-recession maybe they wouldn't be so lost if they would accept that you need to model macro dynamically, not statically using artificial equilibrium models.

i happened across this 8 minute pod cast about the sahm rule recently. https://www.npr.org/transcripts/783120728 it's pretty relevant to some of the discussions in our seminar. claudia sahm is a macro economist at the federal reserve. although she was trained in mainstream economics, she appears to consider approaches outside the mainstream. the 'sahm rule' is her suggestion about how to handle downturns - she proposes using a leading indicator of economic downturn (her own metric based on unemployment) and when the indicator says 'recession coming', she suggests automatic check-writing to households. (on the order of $1000). this says a couple of things to me: 1. she is aware that $ to households works better than $ to banks. this goes against mainstream thinking. 2. she is willing to propose automatic check writing, which is probably anathema to many mainstreamers. yes, they did it during the covid recession, but that was an extreme case. she is proposing doing it for all recessions. (as we discussed a few weeks ago, checks to households makes more sense than the crude instrument of interest rates. interest rates method did not work at all in 2008) so we have a (fairly) young economist at the federal reserve, and she is apparently well-enough respected to get away with proposing this kind of thing. this suggests to me she may be a good prospect for trying to 'reach' on the topic of using dynamic modeling as opposed ISLM and DSGE models. and perhaps BOMD as well. i'm figuring we (the 'rebels') are looking for a path to get wider acceptance of a few basic facts: 1. mainstream micro and macro are wrong 2. if you want to have a decent model of macroeconomics, it has to be dynamic (non-equilibrium). it's possible to get useful models, ones that 'look like' actual economies' behaviors, using the dynamic approach. 3. BOMD is a real thing and is important to macro. she may still 'believe' in equilibrium, not sure (i have not read papers by her). but at least she seems open to considering that something is wrong with the banks-only-redistribute-dollars claim. she may also realize that other things are wrong.

This is especially for John, who asked for this to check his own modelling. Many more to come!

Hi steve, can you please post the models you created during the minsky workshop today? i was following in minsky but I got a little behind. i got most of the first model, the one with 4 godley tables (banks, non-bank PS, central bank, treasury). I got some of the flow defns, but i'm missing some. if you post the model, i'll be able to see what i'm missing Thanks, J 0 Reply 2 Jump to latest comment