Showing posts from July 29, 2016

The Effects of Government-Issued Money: Road to Hyperinflation or Cure for Debt Deflation?

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[So, here is the article my friend Richard sent to me, the last one in today's series, describing a very simple alternative approach that is being tried out by the Japanese government. The banksters, however, will poop blood if such proposals gain any widespread traction. See also: Helicopter Money: Why Some Economists Are Talking About Dropping Money From the Sky. *RON*]
By Ellen Brown, The Web of Debt Blog / Truthout, 27 July 2016
Fifteen years after embarking on its largely ineffective quantitative easing program, Japan appears poised to try the form recommended by Ben Bernanke in his notorious "helicopter money" speech in 2002. The Japanese test case could finally resolve a longstanding dispute between monetarists and money reformers over the economic effects of government-issued money.

When then-Fed Governor Ben Bernanke gave his famous helicopter money speech to the Japanese in 2002, he was talking about something quite diffe…

Silicon Valley Elites Get Home Loans With No Money Down

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[Here's the fifth article in this series related to the effects of neoliberal economic policy. And what happens to the very rich during this seemingly permanent economic downturn? Why, the banks give them a 24-hour turn-around for approval on no-down-payment mortgages on multi-million dollar homes at 1.1% interest. See also: Nike CEO’s Pay Almost Triples to $47.6 Million With Stock Award. *RON*]

Heather Perlberg & Prashant Gopal, Bloomberg, 27 July 2016

Lenders are courting tech workers in the most expensive marketWorries by some about fueling another bubble, and inequality It turns out that even the well-off need help in a housing market as crazy as the one in the San Francisco Bay area, and lenders are elbowing each other in a rush to provide it.

They’re courting Silicon Valley workers with tailored loans, guaranteed 24-hour approval and financial-planning services. Social Finance Inc. has deals with Google and other top technology compa…
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[But does all this economic doom and gloom affect everyone equally? Not by a long-shot. The easy-money policies of neoliberal governments have provided banks and corporations with essentially free money. But the push to get consumers to continue to spend, spend, spend (remember: following 9/11 George Bush literally told Americans to "go to the malls") has cost average Joes their homes and, in some cases, their lives. *RON*]

By Stacy Cowley, New York Times, 28 July 2016
For the first time in nearly 40 years, federal regulators are preparing to significantly strengthen the rules that govern debt collection in an effort to clamp down on collectors who hound consumers for debts they may not even owe.

Under the proposed regulations, which will undergo a lengthy review process, debt collection companies will have to more fully document the debt they are trying to collect, make it clear how a consumer can dispute the debt, and observe state sta…

United Stag-Nations – the decayed decade for GDP per head

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[And, since the previous posting looked only at the UK, the third article in the series looks at the net effect of neoliberal economic policy on a more global basis: the economy has flat-lined, we're screwed. *RON*]

Jeremy Smith, Prime Economics, 27 July 2016

When looking at how economies are doing, we tend to look mainly at the trend in GDP. But in terms of economic well-being, a clearer (though still imperfect) indicator is GDP per head of population – how the economy is doing relative to changes in population.

This chart is easy to interpret: It says we're screwed

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[The second article in the series shows the net effect of neoliberal economic policy: no jobs, no investment, we're screwed. *RON*]
Jim Edwards, Business Insider, 28 July 2016

This is the worst chart we've seen so far about the coming Brexit recession:

UK gross domestic product grew a higher-than-expected 2.2% in the second quarter, as announced Wednesday, but that number reflects the economy before the June 23 referendum on the UK's European Union membership. The lines above are from a more recent survey of chief financial officers at companies. It shows that 80% of CFOs think they will not be hiring in the next year and will not increase capital expenditure over the same period.

They are turning off the money taps, in other words.

Do “Unconventional” Monetary Policies Work?

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[So, here is a series of articles this morning, on the effects of neoliberal economic policy, prompted by a piece forwarded to me by my friend Richard. The first one identifies problems with Quantitative Easing which, along with austerity policies, are two of the main neoliberal interventions intended to promote recovery from the recession. *RON*]

By Philip Arestis, Posted on Naked Capitalism, 28 July 2016 by Yves Smith

By Philip Arestis, Professor of Economics at the University of the Basque Country, Spain and Malcolm Sawyer, Professor of Economics, University of Leeds. Originally published at Triple Crisis

The “unorthodox” Quantitative Easing (QE) monetary measures, along with another “unorthodox” monetary policy, namely negative interest rates, have been implemented by a number of countries in the years following the global financial crisis. This is as a result of the normal policy monetary instrument, the rate of interest, being reduced to n…