If markets voted...

As I noted yesterday, the Wall Street Journal and The Economist long for a time in which markets, or people with means, voted, not the people in general. From the February 1, 1933 New York Times (p. 29).

If it is not clear, it says: “The Boerse recovered today from its weakness when it learned of Adolf Hitler’s appointment, an outright boom extending over the greater part of stocks." Markets are always right, aren't they?


  1. Nice find. I wonder how efficient markets hypothesis believers would respond to that. You should post the quote over at Scott Sumner's blog - he's a true believer in the EMH. See, for example: http://www.themoneyillusion.com/?p=27884

    Matias, I was wondering whether you might be able to help me with this:

    "Unemployment develops, that is to say, because people want the moon; -- men cannot be employed when the object of desire (i.e. money) is something which cannot be produced and the demand for which cannot be readily choked off. There is no remedy but to persuade the public that green cheese is practically the same thing and to have a green cheese factory (i.e. a central bank) under public control."

    —John Maynard Keynes, The General Theory of Employment, Interest and Money, Ch. 17

    Why does Keynes say that money "cannot be produced"? What does he mean?


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