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7/13/11

It has come to my attention that at least one university in America that is teaching "Austrian economics" is teaching something that, in my opinion, bears no relationship to what the original Austrian economists had in mind, at least at the detail level. 

What they seem to be teaching is an Americanized over-optimistic version of Austrian economics that seems to be very much based on building on the results of the successful enforcement of the law against recessions during the years in which it was successfully enforced.  But the successful enforcement of the law against recessions resulted in precisely the sort of artificially-induced bubble boom, with the attendant misallocation of resources, that the original Austrian economists so ardently preached against.  So, in my opinion and as far as I can tell, what those modern American "Austrian economists" are teaching bears no relationship to what the original Austrian economists taught.  It is not Keynesian economics - but it is not real Austrian economics either. 

What I think is happening is that those modern American "Austrian economists" can't get past their fundamentally American orientation, especially in terms of being baby boomers (see the link "Why the law against recessions was passed" on this website).  So they are trying to put the most positive possible spin on the situation that they possibly can. 

But the reality is that the enforcement of the law against recessions did create precisely the sort of bubble-boom that the original Austrian economists so ardently preached against - and that is why we had such a big crash in 2008 and that is why I was able to predict that crash in 2001 already. 

But I did not predict that crash using Austrian economics - especially not the timing of it.  Austrian economics is just compatible with the methods I used.  I used the Kondratieff wave and cycles.  The Kondratieff wave (and cycles) is compatible with the Austrian economics that I know - but it does not appear to be compatible at all with the "Austrian economics" that is being taught at the university level in some universities in America.  That version of "Austrian economics" seems to very much be an overly-positive idealized version that suits the tastes of the (apparently) baby-boomer Americans who are teaching it. 

The problem is that those professors can teach that version all they want - but it does not match reality, ultimately.  The Kondratieff wave (and Elliott waves) is, ultimately, reality, they are actual analysis methods of the economy (and financial markets in the case of Elliott waves), not just a description of the economy, like economics is - and they are not Austrian economics, they are simply compatible with the original version of it that I know.  One can try to make a more positive outcome happen all one wants by teaching an overly-positive version of Austrian economics, but that does not change the fact that the Kondratieff wave (and Elliott waves) is real and I used the Kondratieff wave to predict the downturn of 2008 in 2001 already.  And the downturn that I am still predicting will happen yet, too - totally contrary to the principles that the modern "Austrian economists" in the universities in America that are teaching "Austrian economics" seem to be teaching. 

So that tells me that nearly everyone in America, including many of the "Austrian economists" in academia (what few of them there are - most academic economists are still Keynesians), are going to be caught totally by surprise, at least in terms of expectations, when the next downturn comes.