EconPapers    
Economics at your fingertips  
 

Has Fritz Machlup Stood the Test of Time? Revisiting his Monetary Analysis of the Stock Market: A version of this paper was presented at the third biennial Wirth Institute Workshop on Austrian Economics held in Lake Louise, Alberta, Canada, September 14–15, 2012

George Bragues

A chapter in Entangled Political Economy, 2014, vol. 18, pp 139-160 from Emerald Publishing Ltd

Abstract: Abstract It has often been alleged that the financial markets, with all their speculative excesses, wastefully absorb resources that could be better employed in the real economy. Fritz Machlup, originally a student of Ludwig von Mises, dealt with that charge in the aftermath of the 1929 crash. His defense of the stock market remains germane to our time. In it, he argues that the stock exchange offers an important alternative mechanism of allocating savings to investment, while generally being a way station through which money travels on its way to the real economy either to finance capital projects or to be spent on consumer goods. To the extent the stock market ever absorbs capital, it is only during stock market booms. Yet these are generated by the uncertain course of central bank monetary expansion. Bull and bear markets cycles are, at bottom, politically driven events.

Keywords: Stock market; monetary policy; credit; central banks; capital; business cycles; B22; B31; E32; E42; E44; E50; E58; G10; G12; N20 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.emeraldinsight.com/10.1108/S1529-213420 ... RePEc&WT.mc_id=RePEc (text/html)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:aaeczz:s1529-213420140000018007

Ordering information: This item can be ordered from
Emerald Group Publishing, Howard House, Wagon Lane, Bingley, BD16 1WA, UK
http://www.emeraldgr ... ies.htm?id=1529-2134

Access Statistics for this chapter

More chapters in Advances in Austrian Economics from Emerald Publishing Ltd
Bibliographic data for series maintained by Charlotte Maiorana ().

 
Page updated 2020-03-29
Handle: RePEc:eme:aaeczz:s1529-213420140000018007