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The Principle of Inherent Economic Stability

The principle in macroeconomic theory that states: for every macroeconomic system where there is an institutional relationship whereby all units of government, businesses and individuals (altogether, "stakeholders") are dependent (on all scales of economic activity), the resulting relationship of all stakeholders to said institution must be governed by an underlying structure that is both self-sustaining and self-regulating in nature and operation that provides equal rights to all stakeholders and enforces equal responsibilities upon all stakeholders at all times and under all circumstances.

What does this mean to you?

It means the biggest causes of recessions, depressions, systemic unemployment and your inability to achieve a state of wealth and luxury are in fact due to the meddlesome corruptions of government and if we had a banking system that was both self-sustaining and self-regulating in nature, 95% of the problems we face today could not even happen ever again!

The issue at the heart of this principle theory in economics is the cyclical activity of the economy - and more importantly - demonstrating how this cyclical activity can be brought to a halt and the economy can be forced to grow in a linear fashion if we can be rid of the inherent structural weaknesses that cause these cyclical actions to occur.  One of the core principles of the theory of Lovellian Economics is that structures and systems that are governed purely by market forces (and not the biases introduced by policy-makers, appropriators and other third-parties) are in fact self-sustaining, as the market balances the outcomes at all times and at all levels due to the impact of Rational Choice Theory being constantly played out at all levels of human activities.  This is why free-market capitalism works when it is left to its own devices and why the best prescription for any macroeconomic fault in the current economy's structure is to stop all active measures and allow the economy to work through the false biases and inputs and return itself to normalcy.  This will happen due almost entirely to the fact that all stakeholders will continue to act in strict deference to the dictates of Rational Choice Theory.

The simplicity of this requirement is often lost on the greatest minds in economics who believe the secrets to making our economy work for all of us must somehow require a "secret sauce" that can only come as a result of their own constant modeling and forecasting efforts, while the Lovellian model dictates that if you simply take out a fresh sheet of paper and design the key institutions to be self-sustaining and self-regulating in both their design and the accounting of their operations, then the results will be exactly what you want without any modeling or fancy forecasting being required at all.  There are no worries about what might happen, because; the Lovellian system only acts in deference to actual, real-time market activity and not in deference to the corrupting influences of the politics of the day that always have the net effect of seeking to create an economic advantage for the benefit of one group of stakeholders in the economy over all of the other stakeholders (by process of some form of government decree or similar contrivance).  Lovellian economics sets this entire issue outside the construct of the resulting macroeconomic structure.  Indeed, one of the very first principles to emerge from the research undertaken by Clint Lovell was the creation of a corruption-proof macroeconomic structure and institutional hierarchy for our economic society as a condition precedent to anything else, otherwise; why would anyone want to adopt this new system of economics if it was just as susceptible to the same shortcomings and failures that we see routinely expressed in the current system?

The Principle of Inherent Economic Stability is discussed on an in-depth basis in Something Out Of Nothing - Book II of The Fix.