[lbo-talk] against the productive economy

Barry Brooks durable at earthlink.net
Tue Dec 18 07:56:54 PST 2018


Michael Hudson wrote, "As long as workers and materials are available and the money is added in a way that reaches consumers, adding money will create the demand necessary to prompt producers to create more supply. Supply and demand will rise together and prices will remain stable. The reverse is also true. If demand (money) is not increased, supply and GDP will not go up. New demand needs to precede new supply."

http://Michael-Hudson.com/2012/08/financial-predators-v-labor-industry-and-democracy/ ...

by bailing out banks and bondholders when the time finally comes for governments to create new debt in response to the financial crisis. Instead of increasing social spending or writing down bad debts and loans, governments (at ECB urging) take bad debts onto the public balance sheet, leaving the debt overhead in place. This exacerbates the debt deflation, shrinking economies all the more, reimbursing the 1% at the cost of impoverishing the 99%. This pits the financial sector not only against labor but against the productive economy at large.

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