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Lucas Morales (Founder & CEO/Zeall.us)I am currently reading Why Minsky Matters: An Introduction to the Work of a Maverick Economist by Randall Wray. I am an enthusiast of Modern Money Theory and participate in a group interested in financial systems, the nature of money, and economic policy. I am hoping to get closer to the expert level of understanding that others in that group have so that I can contribute more to the discussion. I believe that if we want to make real change in the world, we need to be looking at the most fundamental aspects of our social lives, and there is nothing more fundamental in society than the point system we use to track IOUs between each other.
Perhaps no economist was more vindicated by the global financial crisis than Hyman P. Minsky (1919–96). Although a handful of economists raised alarms as early as 2000, Minsky's warnings began a half-century earlier, with writings that set out a compelling theory of financial instability. Yet even today he remains largely outside mainstream economics; few people have a good grasp of his writings, and fewer still understand their full importance. Why Minsky Matters makes the maverick economist’s critically valuable insights accessible to general readers for the first time. L. Randall Wray shows that by understanding Minsky we will not only see the next crisis coming but we might be able to act quickly enough to prevent it.
As Wray explains, Minsky’s most important idea is that "stability is destabilizing": to the degree that the economy achieves what looks to be robust and stable growth, it is setting up the conditions in which a crash becomes ever more likely. Before the financial crisis, mainstream economists pointed to much evidence that the economy was more stable, but their predictions were completely wrong because they disregarded Minsky’s insight. Wray also introduces Minsky’s significant work on money and banking, poverty and unemployment, and the evolution of capitalism, as well as his proposals for reforming the financial system and promoting economic stability.
A much-needed introduction to an economist whose ideas are more relevant than ever, Why Minsky Matters is essential reading for anyone who wants to understand why economic crises are becoming more frequent and severe―and what we can do about it.