My supervisor Ray Streater used to quote an example of a physicist's version of proof by reductio ad absurdum that goes more or less like this: "Assume that asymptotic completeness doesn't hold in quantum field theory. What an absurd!"
I was reminded of that as I read this take down of my paper with Steve Keen, where we claim that expenditure is income plus change in debt. In an attempt to show that we are wrong, Ramanan shows that our model violates the "savings equals investment" identity. What an absurd!
Hmm, actually, not only this is not an "inconsistency" of the model (we never claim that this was true, or rely on it to show anything else in the paper), but it is rather essential: in our model, investment is equal to savings plus change in debt. This is the essence of equation (1.5) in the paper, and we were always acutely aware of it.
So much for the rather bombastic conclusion that we must be wrong because we violate the sacrosantity of "savings = investment" -- this is a feature of the model, not a bug!
Having said that, it is nevertheless a feature that ought to be defended, together with the other criticisms raised in both the take down mentioned above and its predecessor.
As it turns out, without engaging in a point-by-pint reply (which would be a very boring read for anyone not called Grasselli, Keen, or Ramanan), it suffices to say that all the criticisms can be defended in two words: endogenous money!