ABSTRACT
Wall Street's view of Keynes is not nearly as illuminating as Keynes's view of Wall Street. Wall Streeters agree that fiscal policy is the preferred method for offsetting an excessive propensity to save, that the interest rate sets the price of liquidity rather than the price of savings, and that the stock market is a critical determinant of the rate of real investment. The durability of Keynes's accusations is proof of how acute his perceptions were; but this was by no means all that he had to say about why the financial markets are the primary source of disequilibrium in the real economy. Thus, Keynes was correct in identifying the long-term interest rate as something more than a reward for parting with liquidity. Hyman Minsky, who has so effectively linked Keynesian theory to the analysis of financial disorder, has elaborated on the concept of money by bringing it right back to the heart of the financial community and Wall Street.
