Boom Bust Boom Page #8

separating out the retail,

the basic banking stuff, from the rather higher-octane

investment banking stuff. And then, we can have another part

of the financial system that does riskier stuff, but we don't allow them to, you know, take funds away from households, from firms, from pension funds. We can redesign cars, so why can't we redesign

the economic system? I got a hundred-dollar check

from my grandma, and my dad said I need

to put it in the bank so it can grow over the years. Well, that's fantastic. A really smart decision,

young man. We can put that check

in a money market mutual fund. Then we'll reinvest

the earnings into

foreign currency accounts with compounding interest,

and it's gone. Uh, what? It's gone.

It's all gone. -What's all gone?

-The money in your account. It didn't do too well.

It's gone. What do you mean?

I--I have a hundred dollars! Not anymore you don't.

Poof. Well... But what can I do

to get back my-- I'm sorry, sir, but this line

is for bank members only. I just opened an account. Do you have any money

invested with this bank? No, you just lost it all. Then please stand aside

for people who actually have money

with us. Next, please. Today there,

the crisis in particular has caused a lot of students

to want to learn economics. This happened with the

Depression generation as well. Many of the people,

like Hyman Minsky, came into economics because of that experience

of their childhood. They felt

this was something important that they needed to understand. They didn't find the economics

that they were taught to be very helpful. The average Ph.D. economist

would train for five years, and they would never learn

anything about the history of the economic system

that had preceded them. If you would spend the class,

uh, for a whole semester, and you learn about one

financial crisis after another, it might occur to that student that financial crises are

a regular part of an economy, whereas if you don't

really make that the focus

and you kind of mention, "Yeah, oh, yeah,

there was a crisis here,

there was a crisis there," it's a lot easier

to convince a student

that crises aren't natural, that it's some fault

of a government or some particular action that caused the crisis in

this peculiar situation, but that's not the normal

tendency of an economy. WOMAN: We're all

undergraduates at the

University of Manchester, and we're members of the Post-

Crash Economics Society. We set up

at the end of last year 'cause we feel that our

economics education so far has been quite limited. One of the main issues

is that economics has been caught

in this trap where... uh... Funding for universities

is entirely determined, well, by and large

determined, by research. And the research

that is going to get published is the mainstream,

is neoclassical economics. As a result, that's what

we're being taught. The beauty of science,

of true science,

physics, chemistry, is that there is a--

there is a debate

between key theorists, between, you know,

different ideas. Whereas, in economics,

that debate simply

isn't big enough, or it's not large enough,

and that's what

we're fighting for. Our education

produces economists

who do believe that their type of economics

is the only way

to do economics. I mean, there's

very little of our degree which is devoted

to analyzing what happened in 2008

and what happened

in the 1920s, which I think must be

a fundamental part

of any economics degree. -Yeah.

-It's embarrassing... going home and people asking,

"Oh, so you do economics? What happened in 2008?" And I can't tell them. What I think we'd all like

to see is, you know, economists with a critical mind

coming out of university, and into the city

and into public policy. And you'll have--

and hopefully you-- you'll have policy

that reflects as well. You'll have a financial

sector that reflects that rather than just, you know,

this one-dimensional myopia. We want to be economists

and we want to see economists coming out of universities that can engage

with the real world economy, whereas at the moment

we don't feel we can. That's what we think

is the point of economics. I think that's sort of

gotten lost somewhere. The way you change

the teaching of economics is to change the teachers. It's as simple as that. You're not gonna

get into a situation where... the teachers who spent decades

building up expertise in very mainstream approaches

are going to simply say, "Oh, yes, well, that was

all a complete waste of time. I'm gonna go do something else."

They simply won't. Right. Now, listen up. ( grunting ) And so, what I think is,

the professors start parroting

these party lines. I think you should just

pelt them with vegetables and rotten fruit,

and maybe urinate on them. That's what, I mean,

that's what I'd do. And there's gonna have to be

a different approach

to how this stuff is taught. It shouldn't be taught

as branch of physics. It should be taught

as a piece of history, or as an idea that economics

is again a social thought. It's something

that we all do together. I--I was

at a conference once with a, uh, economist

from Freddie Mac. That's one of the agencies

that failed in the 2008 crisis. I asked him about--

this was before the crisis-- about what kind of planning they had been doing

for a crisis. And he said confidently,

"We have it planned. So, we have figured out

what would happen to us even if home prices

fell dramatically, and we would

survive the storm." And I said, "Well,

how much is dramatically?" He said,

"Well, we've figured out what would be the effect on us

if home prices fell 13%." And I said, "Well, what if

they fall more than 13%?" And then, he said,

"What do you mean? They've never fallen

that much." He said, "Well, not since

The Great Depression." One of the things

that we learn from the study

of history is that people learn

nothing from history, or they tend to repeat

the mistakes of the past, and I think that's because

of human nature. ( music playing ) We're here forever

blowing bubbles Pretty bubbles

in the air They fly so high Nearly reach the sky They're like my dreams

they fade and die ( groaning ) Fortune's always hiding We've looked everywhere We're forever

blowing bubbles Pretty bubbles

in the air We're dreaming dreams We're scheming schemes We're building

castles high They're born anew Their days are few Just like

a sweet butterfly ( sighs ) And as the daylight

is dawning They come again

in the morning We're forever

blowing bubbles Pretty bubbles

in the air They fly so high Nearly reach the sky They're like my dreams

they fade and die Fortune's

always hiding We've looked

everywhere We're forever

blowing bubbles Pretty bubbles

in the air We're forever

blowing bubbles Two, three, four Pretty bubbles

in the air They fly so high Nearly reach

the sky Then like

my dreams They fade

and die Fortune's

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