“Theory of Economic Relativity – The solution to MONETARY CRISES – A critique of current economic theories: Austrian, Keynesian, and Quantitativist” (2006)
In this book, Carlos Bondone introduces his first conclusions about the theory of economic time (TET) and its exclusive characteristic of “indirect or improper materialization”. This feature is the one that would become the center of his deductive theoretical scaffolding which led him to question the macroeconomy developed in the 20th century.
The reader will find that his TET led him to discover that the characteristics, the ones that the theories assigned in a confusing way to money, are in fact exclusive property of the economic time. This conclusion, together with his categorical division between money and currency, allowed him to assign to the latter a superior rank than money since credit also can serve the purpose of currency.
The author also tells us about the necessary categories of credit that the economy has to incorporate to make the understanding of the real world simpler and clearer. This is the way he presents his original distinction between regular and irregular credit and the essential theoretical implications that derive from it.
Another very important contribution of this work is the demonstration that the economic world is in permanent imbalance, eradicating from the very theoretical possibility the concept of balance, whether it is considered as a starting, arrival or tendency point in economic developments, both practical and theoretical..
This way it proposes that always S ≠ I, versus the current theories which present S = I.
The reader experienced in economic theory will notice the great significance of the expression i ≡ p > 0 that destroys the models both theoretical and practical which consider (with existence of PC) i and p in different coordinates (different variables) as well as the possibility of zero and/or negative interest rates.
We can observe in this work as well as in the countable corroboration of its theory the incorporation of new theoretical concepts and categories which allow an easy understanding of its hypothesis which ratifies Popper´s idea: “all new theory comes together with new concepts”.
At the same time, the reader will find the fundamentals and demonstrations in the discrepancies of these new theories with the “truths” accepted until now such as the curve 45, IS/LM curves, Phillips´curve, endogenous and exogenous currency, price dichotomy, real prices and rates versus currency ones, Gresham law, neutrality of currency, Gibson´s paradox, Garrison graphics, Mises´ theorem of regression, quantitative theory of currency, liquidity trap, aggregate offer and demand, inflation, unemployment, economic cycles, currency crises, balance of payments, change rates, bank loan, independence of central banks, the “barbarous relic”, mechanism of transmission, under consumption or deficiency of demand, etc.
In short, the theoretical conclusions of the author allow him to reach a more solid and simpler macroeconomy, without the need of ad hoc developments to link the micro and macro, ruling out this way the theoretical structures called “fallacies of composition” to explain the supposed inconsistencies between the spheres of individual behavior versus the general one.
Finally, it is useful to refresh some of the expressions which can be observed on the back cover of the book:
A great scientific discovery in favor of democracy and freedom!
A scientific blow to totalitarianism!
Economy to generate richness in equity!
In an irregular currency system the independence of the Central Bank and the political power is impossible, and in a regular currency system its existence is unnecessary!
Discover scientifically the connivance between Banks and politics!
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