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The reason is that every recovery since 1945 has begun with a higher, and higher level of debt. The debt is so high now, that since 2008 we’ve been in what I call, debt deflation.

Michael Hudson

Today, people are having to spend so much of their money, to acquire a house and to get an education that they don’t have enough to spend on goods and services, except by running into yet more debt on their credit cards and other borrowings.
MICHAEL HUDSON

House Nato People Running
The companies aren’t hiring, because consumers don’t have enough money to buy the goods and services.
MICHAEL HUDSON

Consumers Enough Hiring Services
Education is something that should not be organized on a for-profit basis, because in that case its purpose is not really to provide an education.
MICHAEL HUDSON

Fall Government Opportunity
If you look at payments to labor as a proportion of national income or gross domestic product, you find profits going way up, investment and savings going up.
MICHAEL HUDSON

Income Investment Looks National Savings
I don’t think that governments should permit speculation in raw materials, because they’re what the economy basically needs.
MICHAEL HUDSON

Government Needs Thinking
The essence of the global financial bubble is that savings are diverted to inflate the stock market, bond market and real estate prices rather than to build new factories and employ more labor.
MICHAEL HUDSON

Bond Employ Estate Market More Season
Every government, from the Obama administration right through to Angela Merkel, the Eurozone and the IMF, promise to save the banks, not the economy.
MICHAEL HUDSON

Administration Government Promise
Either you can save the economy, or you can save the One Percent from losing a single penny.
MICHAEL HUDSON

Economy Losing Pennies
You’re having government spending on the economy being cut almost everywhere. That means that the only source of spending for growth has to come from borrowing from the banking system.
MICHAEL HUDSON

Cutting Government Mean
You get a constituency; you make them believe your promises, and then you turn them over to your financial campaign backers. That’s what politics has become and that’s as much an art of deception as economics is.
MICHAEL HUDSON

Campaign
The ideological foundation of today’s business schools is that economic control should be shifted out of government hands into those of financial managers – that is, Wall Street.
MICHAEL HUDSON

Financial School Wall
We’re still in the collapse that began after 2008. There’s not a new collapse, there hasn’t been a recovery.
MICHAEL HUDSON

Collapse Recovery Stills
Since 2008 you’ve had the largest bond market rally in history, as the Federal Reserve flooded the economy with quantitative easing to drive down interest rates.
MICHAEL HUDSON

Gains Income Real
So we are in for years of debt deflation. That means that people have to pay so much debt service for mortgages, credit cards, student loans, bank loans and other obligations that they have less to spend on goods and services. So markets shrink.
MICHAEL HUDSON

Cards Credit Fall Loan Mean People
Wages for the ninety-nine percent have gone down, steadily, since 2008. They’ve gone down especially for the bottom twenty-five percent of the population.
MICHAEL HUDSON

Blue Mean Nine Ninety
When we say “people worry” about inflation, it’s mainly bondholders that worry. The labor force benefitted from the inflation of the ’50s, ’60s and ’70s.
MICHAEL HUDSON

Force Labor People Worry

The reason is that every recovery since 1945 has begun with a higher, and higher level of debt. The debt is so high now, that since 2008 we’ve been in what I call, debt deflation.

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The reason is that every recovery since 1945 has begun with a higher, and higher level of debt. The debt is so high now, that since 2008 we’ve been in what I call, debt deflation.

Related Topics

Popular Authors

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