11/28/2023 0 Comments Theorem 1906 new york skyscraper![]() This meant that the nation’s central bank, the Bank of England, should lower interest rates and increase the money supply. Like most economists at that time, he believed monetary policy would remedy an economic slump. It had remained stuck around 10 percent since the end of the war. In the 1920s, Keynes began to focus on the problem of Britain’s unemployment. He called it a system using “the weapons of persecution, destruction, and international strife” along with “an obsolete economics textbook” (Marx’s Das Kapital). Upon returning to Britain, Keynes wrote an essay attacking the Soviet system. On their honeymoon to the Soviet Union to visit Lydia’s family, Keynes met with communist economic planners to observe Marxist socialism in action. In 1925, he married ballerina Lydia Lopokova. A passionate supporter of the arts, he frequently attended the theater, art galleries, and the ballet. He was a long-time member of a circle of famous writers, painters, and performing artists. Keynes lived in Bloomsbury, an area in central London. Published in 1919, Keynes’ book was an international bestseller. He also criticized the leaders for dealing only with political matters like redrawing national borders while ignoring economic cooperation needed to bring permanent peace to Europe. He predicted the harsh treaty would impoverish Germany and would lead to a war of German revenge. In his book, Keynes attacked the leaders at the Paris Peace Conference. Returning to Cambridge, he took charge of the finance department at King’s College and wrote a book, The Economic Consequences of Peace. Keynes declared, “The Peace is outrageous and impossible and can bring nothing but misfortune.” He resigned from the Treasury. It demanded the Germans pay billions of dollars over a period of 30 years. In May 1919, the final draft of the Treaty of Versailles shocked Keynes. ![]() He called for reparations that Germany had a reasonable “capacity to pay.” Keynes believed that by financially crippling Germany, all European nations would suffer. Keynes found that allied leaders believed Germany should pay for the “whole costs of the war,” including widows’ pensions. At the Paris Peace Conference after the war, he was in charge of the ministry’s position on how much Germany should pay in war reparations-financial compensation to the victors. He specialized in financial relations among the allies. When World War I broke out in 1914, Keynes joined Britain’s Treasury ministry. His curiosity propelled him to become an expert in India’s finance system. In 1906, Keynes got a job in Britain’s colonial India Office as a junior clerk. He lost his shirt more than once but ended up with a substantial investment fortune. Keynes also played the stock market, which he considered a casino. He did work as a university lecturer, but he also spent much of his life working in government, writing books and articles (for newspapers, magazines, and academic journals), and working as a financial consultant. He learned economics from Cambridge’s leading economist, Alfred Marshall.īrilliant, an outstanding student, and intellectually curious, Keynes did not pursue a traditional academic career. He earned a degree in mathematics, but his curiosity extended to many fields-history, classical literature, the arts, and moral philosophy. After Eton, he went to King’s College at Cambridge University. Keynes attended Eton, England’s best prep school. His mother was a teacher who later served as mayor of Cambridge. Born into an academic family in 1883, his father was a noted philosophy and economics professor at Cambridge University. John Maynard Keynes (pronounced canes) was one of the great economic thinkers. His ideas led to a revolution in economic thought. He argued that uncertainty caused individuals and businesses to stop spending and investing, and government must step in and spend money to get the economy back on track. John Maynard Keynes and the Revolution in Economic Thoughtīritish economist John Maynard Keynes believed that classical economic theory did not provide a way to end depressions. ![]() England’s Glorious Revolution | John Maynard Keynes and the Revolution in Economic Thought | William Jennings Bryan, the “Great Commoner” ![]()
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