Nick Rowe talks about the different kinds of coordination failure and the sort of coordination failure that characterizes this downturn. The discussion of the various "Keynesian" models and what coordination failures are associated with them is very good.
There's a good discussion of the relationship between anchored expectations and the equilibrium process that supports "market process" type thinking on the Austrian side, if you want it to. This point reminds me of Keynes in the Tract on Monetary Reform. One of the few things that he praised the gold standard for was that it was slow to adjust. That cut down on the noise and accomplished that task that Rowe attributes to anchored expectations here.
The post is a tsunami of metaphors and allusions to points that are internal to Keynesian discussions. That may make it confusing to some people, but I still think its very good to read through. Up until now I've been skimming a lot of posts on this blog. There have been a lot of good ones lately, and I'm definitely not going to skim anymore.
The George Evans video I share in this post may help explain what he's talking about too. It's still technical, but less dependant on lingo like "stag hunt", "tinkerbell", or "sunspots".
Austrian Revival Photos
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