Rehabilitation of Say's Law, A

It is obvious that Dinesh Desai did not read the book, did not comprehend what was said in the book, or just chose to approach the book with his Leftist Keynesian bias. Every student of economics must read this book. I think that Keynesians do not understand it because of their methodology. They do not understand human action. And if you approach this book without grasping the subjective theory of value and humans and their relationship to goods, services, production, and consumption then you will not understand Say's Law. This is why there are so many people who think Say's Law is a fallacy..Keynesians do not understand human action. If they did then they would have to give up their whole pious claptrap. 

The demand for goods is never satiated, thus there can never be "inadequate demand" in the general sense, but only in the relative sense. Since productions are only bought with productions, relative overproduction's, caused by disturbing the price mechanism, must mean a depression in the exchange rate between that good (relatively abundant good) and other goods (relatively scarce goods).

The time lag you seem to take issue with is not important. The point is that the economy will correct itself through the price mechanism.

"As each of us can only purchase the productions of others with his own productions—as the value we can buy is equal to the value we can produce, the more men can produce, the more they will purchase. Thence follows the other conclusion, which you refuse to admit; that if certain goods remain unsold, it is because other goods are not produced; and that it is production alone which opens markets to produce." -JP Say to Mr. Malthus.

EX POST, SAY'S LAW IS A TAUTOLOGY.  EX ANTE,IT IS A BEHAVIORAL RELATIONSHIP.  OBVIOUSLY, PRODUCTION GENERATES INCOME AND INCOME GENERATES DEMAND.  BUT, DOES IT GENERATE ENOUGH DEMAND TO ABSORB PRODUCTION?  NOT IN THE REAL WORLD WE LIVE IN. THE MAJOR FLAW WITH SAY'S LAW IS THAT IT MAKES NO REFERENCE TO STRUCTURE OF PRODUCTION, INCOME DISTRIBUTION AND ECONOMIC TIME LAGS.  DEMAND DEPENDS NOT ONLY ON THE LEVEL OF INCOME, BUT ALSO ON THE DISTRIBTUION OF INCOME.