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Paying debt service to banks leaves less income to buy goods and services.

Michael Hudson

If bankers can push the loans and make more profits for the bank, they get paid higher bonuses. They often also get stock options.
MICHAEL HUDSON

Government Guy Running
What’s the best gamble in the world, right now? Its betting that Deutsche Bank stock is going to go down. Short sellers borrowed money from their banks to place bets that Deutsche Bank stock is going to go down.
MICHAEL HUDSON

Credit Gamble Hands World
In order to be an economist these days, you have to participate in this fairytale that somehow we can recover and still make the banks rich. And it is a fairytale.
MICHAEL HUDSON

Fairytale Order Rich
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
Inflation usually helps the economy at large, but not the 1% if wages rise. So the 1% says that it is terrible.
MICHAEL HUDSON

Economy Helping Wages
It’s amazing that Europe says, “What are we going to do with these refugees?” It’s as if it doesn’t realize that being part of NATO and bombing these countries forces them to choose to live by fleeing, or to stay and get bombed.
MICHAEL HUDSON

Country Fleeing People Person
Small banks that lend to consumers are fine.
MICHAEL HUDSON

Banks Consumers Fine Small
Once the speculative demand ended, all of a sudden the added production facilities that had been brought into production by the high prices went out of production again, and there was a glut.
MICHAEL HUDSON

Demand Ended Glut Once Production
Most people think of the economy as producing goods and services and paying labor to buy what it produces.
MICHAEL HUDSON

Country Real Thinking
We’ve turned the post-war economy that made America prosperous and rich inside out.
MICHAEL HUDSON

People Rich Winning
Driving down the interest rates creates a boom in the stock market, and also the real estate market. The resulting capital gains not treated as income.
MICHAEL HUDSON

Driving Estate Income Rates Real
One basic myth is that rich people get wealthy by earning income. But that’s not how most get rich. Most of the gains of the rich people since 1945 have been “capital gains”.
MICHAEL HUDSON

Earning Income People
Britain is having a referendum as to whether to withdraw from the European Union, and it looks more and more like it may do so. So the world’s politics are in turmoil.
MICHAEL HUDSON

Look More Union Withdrawn World
If you want to see where Trump is moving, look at what the United States neoliberals advised Russia to do after 1991, when they promised to create an ideal economy.
MICHAEL HUDSON

Country Moving People United States
This is the sector that backs the political campaigns of senators, presidents and congressmen, and they use this leverage to make sure that their people dominate the Federal Reserve, Treasury and the federal housing agencies.
MICHAEL HUDSON

Conbgression Make Sure Treasury
The problems of 2008 were never cured. The Federal Reserve’s solution to the crisis was to lend the economy enough money to borrow its way out of debt.
MICHAEL HUDSON

Balance House People

Paying debt service to banks leaves less income to buy goods and services.

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Paying debt service to banks leaves less income to buy goods and services.

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