Friday, May 22, 2009

Teaching Yourself Economics in 90 Minutes

The news is filled with reports of high unemployment, deficits, inflation, deflation, and bailouts. There are conflicting news stories and commentaries on the causes (deregulation, fear, greed, low interest rates, etc.) and the solutions (government spending, bailouts, borrowing, bankruptcy, etc.) Much of what is being said is propaganda to support the agendas of people whose interests are not necessarily your interests. To sort out the wheat from the chaff, I recommend you do some study of your own so that you can analyze what they are saying.

The reason much of the information is contradictory is because there is bias in the world view of the writers. Richard Maybury identifies 5 different paradigms: Keynesian, Marxist, fascist (corporatist), monetarist, and Austrian. My bias is that the Austrian view is most accurate. The Austrian view has a theory of business cycles and has correctly forecast past downturns and today’s mess. Do your own self study based on how much of your own time you want to invest.

90 minutes or less

The comic book version takes about an hour:

even if you don’t want to bother reading it, someone else (a non-native English speaker) will read it to you

There are some longer text primers like this one by Gary North

6 hours or less

If you have more time, the best beginning economics book I’ve ever read is “Economics in One Lesson” by Henry Hazlitt. That’ll take you a few hours, depending on how fast a reader you are.

A good book by rep that I haven’t read is “Whatever happened to Penny Candy” by Richard Maybury

If you want to read the books that predicted the current crisis, there’s Crash Proof by Peter Schiff (very accurate) or Financial Reckoning Day by Bill Bonner and Addison Wiggin (less accurate, but gets the gist).

If you want to read an analysis after the fact, there’s “Meltdown” by Thomas Woods. I haven’t read this book, but it has strong reviews and Woods writes very clearly.

More than 6 hours to invest

If you want to get into scholarly work, then the Austrian theory was developed by Ludwig Von Mises and furthered by Murray Rothbard. Their books are at the site

In the end, you can invest months studying. But for the quick down and dirty – which will put you ahead of most journalists (stenographers for government mouthpieces) who write for the Times or Newsweek -- the comic will put you ahead of 95% of everyone else.