Top Highlights

• following J. M. Keynes, who argued that “in an unstable economy speculation dominates enterprise” (p. 18). Unlike
• And unlike other analyses that blame “shocks,” “irrational exuberance,” or “foolish” policy, Minsky argued that the processes that generate financial fragility are “natural,” or endogenous to the system.
• However, “stability is destabilizing,” as relative tranquility encourages more risk-taking and innovative behavior that increases income even as it disrupts the conditions that generate “coherency” and “tranquility.” That is, the market forces that operate when a system is stable will push it toward instability, so that even if anything like an equ...
• Since financing investment is the most important source of the instability found in our economy, it must also be the main topic of analysis if one wants to stabilize the unstable economy. Hence, Minsky’s treatment of investment and how it is financed plays a central role in this volume. The superiority of his analysis becomes readily apparent on a ...
• Minsky frequently argued that the Great Depression represented a failure of capitalism that was resolved only by the creation of the Big Government and Big Bank, a phrase he frequently used to denote the size of government, the level of public expenditure, and the central bank, and by the various New Deal reforms (p. 221; Minsky 1993). While