You have to abolish pension plans. You have to abolish social spending. You have to raise taxes.
MICHAEL HUDSONDriving 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.
More Michael Hudson Quotes
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Inflation usually helps the economy at large, but not the 1% if wages rise. So the 1% says that it is terrible.
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The seeming irony is that it’s so bad that it enables the Democratic Party to think, “A-ha, all we have to do is be the lesser evil.
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If the bank goes under, they get to keep all of these salaries and options – and the government will bail out the bank. These guys will take their money and run, which is pretty much what they’re doing now.
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One of the big problems in America’s economic polarization and shrinkage is that pensions can’t be paid. So there are going to be defaults on pensions here, just like Europeans are insisting in rolling back pensions. You can look at Greece and Argentina as the future of America.
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What’s bad for the frackers usually is good for the rest of the world.
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More and more money is being extracted from of the production and consumption economy to pay the FIRE sector. That’s what causes debt deflation and shrinks markets. If you pay the banks, you have less to spend on goods and services.
MICHAEL HUDSON -
We’re still in the collapse that began after 2008. There’s not a new collapse, there hasn’t been a recovery.
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Somehow most people believed they could get rich by going into debt to borrow assets that were going to rise in price. But you can’t get rich, ultimately, by going into debt. In the end the creditors always win.
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To the deficit commission, a depression is the solution to the problem, not a problem.
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Much higher cost for all the infrastructure that he’s proposing. You could call Trump’s plan “public investment to create private profit”. That’s really his plan in a summary.
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you’ll load the company you take over with debt. But you don’t have to pay taxes on the profits that you pay out in this way. You can deduct the interest from your tax liability.
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When people are running up more and more debt for housing, they call that “real wealth.” It exposes what’s wrong in the mainstream economics and why most of the economics that justifies austerity programs and economic shrinkage is in the textbooks is not scientific.
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Deflation is a leakage from this circular flow, to pay banks and the real estate, called the FIRE sector – finance, insurance and real estate. These transfer payments leave less and less of the paycheck to be spent on goods and services, so markets shrink.
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I think we’re in the take-the-money-and-run stage of the economy. So the banks may go under, but the bankers, who make the policy, clean up.
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