Category Archives: A New Paradigm

The Einsteinian Context: Curvature and Relativity

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Albert Einstein, Steven Weinberg, Lillian Lieber, Douglas Giancoli, Raymond A. Serway, Bernard Lonergan, Philip McShane, Peter Burley,

.1. Introductory

Graduate students seeking a thesis topic may expand this treatment of the Einsteinian context of Functional Macroeconomic Dynamics.  It should be of special interest to those having a strong background in theoretical physics and, thus, able to appreciate the analogies from physics.  “Similars are similarly understood.” (CWL 3, 288/313)

Philip McShane alerted us to the resemblances between Lonergan’s context of general macroeconomics and Einstein’s context of general relativity.

(Part Two entitled Fragments) belongs almost entirely in what I call the Einsteinian context of Part Three, in contrast to the Newtonian achievement of Part One; … [CWL 21, Index, 325]

A new science has emerged.  Lonergan has elevated conventional macrostatics to a macrodynamics explaining economic accelerations. (Continue reading)

The Notion of Organic Unity; Macroeconomic Field theory as a Unified, Systematic Whole

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.1. Introduction

Lonergan’s treatment of the intelligibility of the plane circle provides to us a clue.  In the basic insight defining the plane circle, – that all radii are equal – all the interrelated concepts tumble out together in an intelligible unity.  The all-together intelligibility points to a template for explanation in the macroeconomic field; it fore-casts a singular unified intelligibility of the dynamic, organic economic process.  In the sweeping comprehensive act of understanding, all the abstract explanatory conjugates explaining the dynamic economic process are “yoked” together by their functional relations to one another.  The interdependencies of the flows which constitutethe whole dynamic system are grasped in a solidary whole.  And the patterns of the formulation are isomorphic with the patterns in the objective, unitary economic process.  The principle of unity and wholeness is a single, comprehensive intelligibility. (Continue reading)

To and For Economists, Investment Analysts, and Commentators on Bloomberg Surveillance, Squawk Box, and Mornings with Maria

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To Tom Keene, Andrew Ross Sorkin, Maria Bartiromo, Lisa Abramowicz, Becky Quick, Francine Lacqua, Dagen McDowell, Joe Kernen, Jonathan Ferro, Larry Kudlow, Charles Payne, Neil Cavuto, Stuart Varney, Jim Cramer, Henrietta Treyz, Larry Summers, David Weston, Courtney Donohoe, Romaine Bostick, Hallinda Amin, Dani Burger, Gina Cervetti, Margaret Collins, Manus Cranny, Abigail Doolittle, Scarlet Fu, June Grasso, Kriti Gupta, Ritika Gupta, Morgan Brennan, David Faber, Steve Liesmann, Carl Quintanilla, Kate Rooney, Rick Santelli, Michael Santoli, Liz Claman, Gerry Baker, Taylor Riggs, Anastasia Amoroso, Jackie DeAngelis, Brian Brenberg.

Lonergan’s Preface to his seminal work Insight, A Study of Human Understanding, begins …

In the ideal detective story the reader is given all the clues yet fails to spot the criminal.  He may advert to each clue as it arises.  He needs no further clues to solve the mystery.  Yet he can remain in the dark for the simple reason that reaching the solution is not the mere apprehension of any clue, not the mere memory of all, but a quite distinct activity of organizing intelligence that places the full set of clues in a unique explanatory perspective. (CWL 3, Preface ix)

Paraphrasing the above (CWL 3, Preface, ix): Continue reading →

Pointers Regarding Interest Rates and Inflation; The Delusion in Manipulation of Interest Rates

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We encourage the reader to consult the following entries.

The Ineptitudes in Central Bank Operations

John H. Cochrane’s Article in the Wall Street Journal, Thursday 8/25/2022

Facing Facts: The Ideal of Constant Value of the Currency vs. the Fact of Inflation

The Road Up is The Road Down; the Mechanism of rising and Falling Prices

Stagflation Demystified

Paul Romer’s “Endogenous Technological Change” in Bernard Lonergan’s Framework

Here are a few brief selections from the above treatments:

Traditional theory looked to shifting interest rates to provide suitable adjustment.  In the main we shall be concerned with factors that are prior to changing interest rates and more effective. [CWL 15, 133) Continue reading →

New Foundations in 30 Minutes

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New foundations for a new science of macroeconomics are grounded in

  • a scientific, dynamic heuristic
  • the technique of implicit definition
  • precise, purely relational, analytic distinctions between abstract fundamental terms and relations from which a superstructure of complete explanation may be deduced
  • the relativistic, field-theoretic functional interrelations among interdependent, mutually-defining, explanatory functional flows

Continue reading →

The Road Up is The Road Down; The Mechanism of Rising and Falling  Prices

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This post was originally entered on May 30, 2022.  We repeat it now because it is remains relevant.

“The road up and the road down is one and the same. (Heraclitus)
ὁδὸς ἄνω κάτω μία καὶ ὡυτή

Archaeologists and scholars have not found the context of this isolated fragment of Heraclitus.  What “road” was he referring to, and was he was speaking literally or figuratively? I simply like the statement as an introduction to the ups and downs of distinct price-quantity flows, whether in a pure cycle of expansion or in a distorted cycle of inflationary boom and corrective slump. Continue reading →

Pointers to the Philosophic, Mathematical, and Scientific Bases of Lonergan’s Functional Macroeconomic Dynamics

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Being is the objective of the unrestricted desire to know.  Being is intrinsically intelligible and one. Apart from being there is nothing.

Intelligibility is the very essence of unity.  Intelligibility is intrinsic to being and, at the same time, it is the essence of unity.  Formal intelligibility is form; it is the unity of unification or of correlation.  Correlation is abstract; it constitutes the implicit definition of explanatory terms by their functional relations among themselves.

“Functional” is for Lonergan a technical term pertaining to the realm of explanation, analysis, theory;  … Lonergan (identified) the contemporary notion of a “function” as one of the most basic kinds of explanatory, implicit definition – one that specifies “things in their relations to one another” … [CWL 15, 26-27  ftnt 27]

The economic process is an aspect of being.  The immanent intelligibility of the dynamic economic process is the essence of the process’s unity.  (Continue reading)

Lonergan’s Entry into Economics (1930-1944) and Reentry into Economics (1978-1983); Democratic Economics vs. Liberalism and Socialism

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The reader will note that most of what’s quoted below comes from a single section, “Lonergan’s Entry into Economics, 1930-1944”, of CWL 15’s “Editors’ Introduction,” authored by Frederick G. Lawrence.  Previously, in several of our own sections we have recommended that Editors’ Introduction as beneficial for putting Lonergan’s Essay in its historical, political, and purely theoretical contexts.  It is a must-read.  We have printed the Introduction’s Table of Contents in several places:  Click here, here, here, and here.  The Table is again printed at the end of this entry.

Lonergan’s Entry into Economics, 1930-1944

We quote: Continue reading →

Circulations: Blood, Electricity, Water, Money

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The method of circulation analysis … involves a minimum of description and classification, a maximum of interconnections and functional relations.  … Analytic thinking uses classes based on similarity only as a springboard to reach terms defined by the correlations in which they stand.  [CWL 21, 111]

… the introduction of the notion of the monetary function… takes a further step towards defining a circulation of money……..not a rotational movement……. rather a circular series of relationships of dependence of some flows of payments on other flows.  Money moves only at the instant of payment or transfer.  Most of the time it is quiescent. … it may also be dynamically quiescent, and then it is held in reserve for some definite purpose. … Money held in reserve for a defined purpose will be said to be in a monetary function.  Five such functions are distinguished: basic demand, basic supply, surplus demand, surplus supply, and a fifth redistributive function. (CWL 15,  48)…….

Volume 15 of Collected Works of Bernard Lonergan is entitled Macroeconomic Dynamics: An Essay in Circulation Analysis. Lonergan analyzes and explains the economic process as a circulatory process; that is, as a dynamic organic process of interdependent circulatory flows of goods and services and their functionally-congruent payments.  It is to be understood and verified as a coherent set of flows implicitly-defined by their functional relations to one another. Continue reading →

Lonergan’s “Macroeconomic Field Theory” (MFT), AKA “Functional Macroeconomic Dynamics” (FMD)

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Functional Macroeconomic Dynamics seeks not merely to “view” and describe the economic process; rather it seeks to understand and explain the process in order to provide norms of adaptation and systematic guidance to managers of the process. (Continue reading)