Epstein Secrets

duced from retained earnings within companies. For many economists, somewhat oddly, this will be seen as a serious flaw. Since at least the time of Keynes, investment and saving have been at the heart of macroeconomic modelling, and this is true of neo-classical and other heterodox modelling, not just

These ideas include recent research in market microstructure, liquidity, post-Keynesian pricing theory as well as the work of Foley, Keen, Smithers, Shiller, Cooper, Pettis, Pepper & Oliver, Mehrling, Lyons and others. Neoclassical economics, while forming an intellectually beautiful framework, has prov

tly following the dramatic changes in value during the dotcom and housing booms of the last decade, and secondly because of the detailed research of Shiller, Smithers and others that both disprove a purely stochastic basis for stock market movements and also give substantial evidence for long term rever

the players know that it is the Old Maid which is circulating, or that when the music stops some of the players will find themselves unseated." 3M Keynes [Keynes 1936] The following is a brief review of current research and emerging ideas within the field of liquidity. This section is something of a

hree factor' model. This then becomes much more significant at the level of the whole stockmarket, especially in the light of the extensive work by Shiller and Smithers regarding the long-term valuation of stock markets. This work is very well summed up in 'Wall Street Revalued' [Smithers 2009]. The ce

olio of investments. Interestingly, this should act in a strongly counter-cyclical manner. Given the mean reversion properties of the market as per Shiller and Smithers, liquidity protection of this type should be cheap at historical liquidity lows, but increasingly expensive as liquidity bubbles formed

loyment is higher in model 46 than model 4A. Also the ratio of returns to labour to returns to capital is significantly higher in model 4A. This is Keynes writ large. Unlike static equilibria, dynamic equilibria can have multiple points of stability. The point of equilibrium that is reached depends on

ish to remain working in finance. They are obliged to adopt rules of thumb that work. Some of the more thoughtful financiers, people such as Pettis, Shiller, Smithers, Cooper, Pepper & Oliver have then made insightful attempts to explain why these rules of thumb work in practice. In the field of market