The Great Depression of 1990s

1. ReviewedbyPirQasimShah
Title:The Great
Depression of 1990
Author: Dr. Ravi Batra
BookType: Macro
Economics
Price:$11.67
Publisher: Simon &
Schuster NewYork
ISBN:0-671-64022-4

2. AbouttheAuthor
Born: Multan Jun 27 1943
Occupation: Professor, Author.
Education:
M.A. Dehli School of Economics
Ph.D. Southern Illinois
University
Current Employer: Southern
Methodist University DallasTX
Spiritual Influence: Prahbat
Ranjan Sarkar (Founder of
Ananda Marga)
Professional Heritage:
Progressive utilization school
Raveendra Nath "Ravi" Batra

3. 1.Can it Happen again?
2.The Law of Social Cycles
3.The Long Run Cycle of Money and Growth
in the United States
4.The Long Run Cycle of Inflation
5.The Long Run Cycle of Regulation
6.Concentration ofWealth and Depressions
7. The Great Depression of 1990-1996
8.Strategy for Investment
9.CanWe Prevent Another Depression?
Distribution of Book

4. ReasonforWritingthisBook
1. To inform the society
about the up coming
recession
2. To provide guidance
and advice about how
to deal with it
3. To help in investment
decision making in the
predicted recessionary
period

5. PrabhatRanjanSarkar 21May1921–21October1990
Philosopher, Author, Social,
Revolutionist, Poet,
Composer & Linguist.
Major Works:
• Law of Social Cycles
• Progressive Utilization
Theory
• Philosophy of
Neohumanism
• Ananda Marga Org (Path
of Bliss)
• PROUT Universal

6. Sarkar’sPROUT
 Practical alternative to the
theories of Marxism
(communism) and Capitalism
 PROUT is based on universal
values recognizing and
protecting the rights of all
 Protection of the
environment
 Dynamic, incentive-based
multi-tiered economy
 Cooperatively-employee-
owned enterprises
 Encourages a balance in the
effort of satisfying individual
and collective needs.
 No one should be left behind
as society marches forward

7. ReviewCont…CanitHappenagain?
Yes based on the economic & socio-political analysis done by
the author.
Predictions made by author:
1. The Shah of Iran will be overthrown and clergy
would take over 1979
2. In 1980’s Iran & Iraq will start long war
3. Europe would experience recession in 1986-87
4. America would suffer a depression in 1989-90
5. Capitalism would be overhauled in 19990’s

8. TheLawofSocialCycles

9. Long run economic cycle

10. Long run growth comparison

12. GDP Change of US 1923 – 46 (Annual) 1947 – 09 (Quarterly)

13. • The Depression of the 1780’s
• The Great Depression of the
1840’s
• The Great Depression of the
1870’s
• The Great Depression of the
1930’s

14. Economy determined by the Revolution in
1770s
Dependency on British Markets didn’t
work
PeaceTreaty with English Signed in Paris in
1783
Depression was caused mainly due to huge
Balance ofTrade
Protectionist policies of France and Britain
US goods couldn’t be sold openly abroad
Depression lasted six years
The Depression of the 1780’s

15. •Inflation of Land, cotton, wheat and
slaves rose
•Virtually the whole nation felt the
effects of the panic. Connecticut,
New Jersey, and Delaware reported
the greatest stress in their
mercantile districts
•In some other regions business activity
decreased more than 20%
•Lasted about seven years
The Great Depression of the 1840’s

16. TheGreatDepressionof1930’s
Worst Depression of all times
EconomicActivity sank down to 40%

17. TheGreatDepressionof1930’s

18. ConventionalWisdom&WealthConcentration
•Changes in the aggregate
demand and supply of
goods and services
•Total consumption
•Investment &
•Government Expenditure
•Inept fiscal policy, tax
revenues fell, business
activity reduced, rising tax
rates reduces further
consumption.
YEAR Share of Wealth by
1% Richest
1929 36.3
1933 28.3
1939 30.6
1945 23.3
1949 20.8
1953 27.5
1956 26.0

19. TheGreatDepressionof1990-96
Assumptions:
History has its own rhythm
Money, Growth and
Regulations have a
deterministic path
Recessions though complex
have a pattern
Cycles of Inflation, Money etc
crest every third decade in a
century
Depressions occur at
intervals of three or six
decades
•Theory of Economic Cycles is
still alive.
•History repeats itself
•There are a few common
characteristics among
recessions
•Viewing society revolving
around sarkar’s philosophies
•Patterns could be broken
through fundamental
economic reforms

20. CriticalAnalysis
 LesterThurow wrote
intro but to a
monograph/novel not
this book.
 NewYork times 1987
Aug 30; p.7 says
sarkar was convicted
of six murders
 Batra talks to sarkar
(LATE) via a type of
meditation tantra
 Forecast a great
disaster & include a
formula for
redemption, either
ways you’ll win.
 Mixed ideas ofTaxing
& Saving Wealth
Concentration
 Social Science citation
index 1986. 21
Ciataions

21. CriticalAnalysiscont…
•Small sample size
•Data gathering
issues
•Focus on US only
•Sarkar’s Social Cycle
theory lacks in
explaining Laborers
Era &Transformation
Process
• More than one
method for
forecasting violates
consistency principle
•Insufficient
conclusions drawn
from the premise
•Written for Fame &
Money; not for Help!

22. AnalysisofEconomicRecessions
Name: Umair Haque
Nationality: Pakistani, British
Occupation: Author, Director,
Bloggers, Analyst, Business Speaker
Education: Bachelors in Psychology
(London School of Economics)
MBA (Oxford University)
Ph.D (Oxford University)
Publications:The New Capitalist
Manifesto. Regular Columnist of HBR,
Economics for Humans, Building a
Disruptively Better Business
Employer: Havas Media Lab

23. Alternativeperspective

24. DiscussionandQ/ASession
 Thank you