Quantitative easing has amplified inequality.

It drives up share prices, benefiting those who own the majority of shares—the wealthy.

Meanwhile, the vast majority of Americans, who own a trivial amount, see no benefit.

This policy has deepened the divide, not bridged it.

Let’s break this down.

Mainstream economists often tout quantitative easing as a magic bullet for economic woes.

They claim it stimulates the economy by increasing liquidity.

But here’s the catch: it primarily benefits those who already have assets.

Imagine a giant balloon.

Quantitative easing pumps air into it, but only those holding onto the balloon feel the lift.

The rest of us? We’re left on the ground, watching it float away.

Take the stock market, for instance.

When central banks inject money

401(k)s are a joke for the working class.

The common belief is that 401(k)s are a solid retirement plan for everyone.

But that’s a myth.

A trivial amount is owned by the working class, while the rich hold the majority.

According to the Economic Policy Institute, the top 10% of earners own 84% of all stocks.

So, when share prices increase, it’s the wealthy who benefit, not the average worker.

This isn’t just a minor issue.

It’s a systemic problem.

America remains a capitalist oligarchy, not a democracy.

The rich get richer, and the rest are left scrambling.

Think about it.

If you’re working 9 to 5, barely making ends meet, how much can you really contribute to a 401(k)?

Not much.

Meanwhile, the wealthy can max out their contributions and reap the rewards.

It’s

The Federal Reserve’s misunderstanding of the 2007 crisis has only worsened inequality.

They pushed quantitative easing, thinking it would save the economy. Instead, it inflated asset prices. Who benefits? The wealthy.

Most people own minimal shares. They gain nothing.

It’s like giving a starving man a cookbook. Looks helpful, but doesn’t fill his stomach.

The Fed’s actions have tightened the inequality rubber band.

It’s stretched to its limit. Ready to snap.

When it does, the fallout will be severe.

The rich will cushion their fall with their inflated assets.

The rest? They’ll hit the ground hard.

This isn’t just theory. Look at the data.

Since 2008, the wealth gap has widened.

The top 1% now hold more wealth than the bottom 90%.

That’s not a healthy economy.

The mainstream belief is that deregulated markets lead to economic prosperity.

This is wrong.

The 2007 housing crisis is a glaring example.

Unregulated mortgage lending led to excessive debt, causing a financial meltdown.

Instead, we need to regulate mortgage lending to prevent such excesses.

When banks lend irresponsibly, they inflate housing bubbles.

These bubbles burst, leaving ordinary people in financial ruin.

Regulation can curb this destructive cycle.

Another common belief is that private debt doesn’t matter.

This is also wrong.

High private debt levels stifle economic growth.

When households are drowning in debt, they can’t spend on goods and services.

This reduces demand, leading to slower economic growth.

Policies to reduce private debt levels are

Mainstream economics ignores three crucial elements: banks, debt, and money.

This omission is like trying to understand bird flight without considering wings.

Imagine trying to explain how a car works but ignoring the engine.

That’s what mainstream economists do when they leave out banks, debt, and money.

They assume these elements are irrelevant or will naturally balance out.

But that’s not how the real world operates.

Banks create money through lending, which fuels economic activity.

Debt isn’t just a passive outcome; it’s a driving force.

When people and businesses take on debt, they spend more, which boosts the economy.

But when they pay it back, spending drops, slowing the economy down.

Ignoring this dynamic is like ignoring gravity in physics.

It’s not just an oversight;

This obsession with government surpluses is misguided.

Why? Because it overlooks the ticking time bomb of private debt.

When private debt balloons, it sets the stage for economic crises.

Take the 2007 housing crisis.

Governments were patting themselves on the back for their fiscal discipline.

Meanwhile, private debt was skyrocketing.

The result? A catastrophic financial meltdown.

Reducing government debt while private debt soars is like fixing a leaky faucet while your house is on fire.

It’s shortsighted and dangerous.

Balancing both is essential for sustainable growth.

We need to look at the whole picture.

Ignoring private debt is a recipe for disaster.

It’s not just about numbers on a balance sheet.

It’s about real people, real lives.

When private debt

It’s true that MMTers rarely discuss how the private banking system creates money. But it’s easy to show both credit and fiat money creation in Ravel

Central Bank direct purchases of Treasury Bonds are banned by law in most countries. But they’re not banned by the accounting. If they did happen, guess who would suffer the most?

Legislative laws–rather than the laws of double-entry bookkeeping–require Central Banks to buy Treasury Bonds from the private banks in Open Market Operations, rather than directly from the Treasury. This video explains this process.

Mainstream economists believe–without having done the double-entry bookkeeping–that Treasury bond sales amount to the government borrowing from the private sector. Checking the double-entry bookkeeping gives an entirely different answer.

Using Ravel, it’s easy to show that the basic argument of MMT–that government spending in excess of taxation creates money–is correct.

Ravel is available from https://www.patreon.com/ravelationfor $7 per month; Minsky is available from the same site for $1 per month.

Ravel is a brand new, intuitive way to analyse data. It is built on top of the Open-Source system dynamics program Minsky, which is the only program in existence that is designed to model financial flows using double-entry bookkeeping.

I explain that fundamentals of double-entry bookkeeping in this video.

In the next in this series, I put MMT under the crucible of double-entry bookkeeping to see whether it makes sense.

Ravel is available from https://www.patreon.com/ravelation for $7 per month; Minsky is available from the same site for $1 per month.

I’m giving a live demo of Ravel tomorrow (Tuesday July 16th) at 6pm London time. This is a quick teaser to show what Ravel can do.

Whether you use spreadsheets, Pivot Tables, Business Intelligence programs (Tableau, PowerBI) or programming languages (Python, R) at present, you owe it to yourself to see how much easier it is to analyse data using Ravel.

Go to https://www.youtube.com/live/MbIl-WWrq4k?si=6qqG5NeWntCcBc0d and click "Notify Me" to get a reminder when the live stream is about to start.

All attendees at the live stream will be able to get a free 60-day-limited copy of Ravel.

Ravel is a whole new way to do Business Intelligence analysis. Its core is the Ravel–a graphical object for handling multidimensional data which is far easier to use, and far more powerful, than a Pivot Table.

Analysis is done using easy to audit flowchart formulas–rather than obscure cell references, or complicated Pivot Tables.

Join the live stream and receive a free 60 day limited edition copy of Ravel to try out!

Tony Wilson a long time viewer of the livestream and an engineer joins the show this week. Steve will also be giving as a test drive on the Ravel software, in what is our final show before our summer break.

"Economic systems are some of the most complex on Earth, and understanding them means using the right tools, which we’ve fundamentally failed to do."

Join Steve Keen as he delves into the true essence of economics and its profound impact on human civilization. Discover why he believes the field has lost its way and how adopting engineering principles could revolutionize economic modeling. From the exploitation of high-grade energy sources to the need for respecting life, Steve challenges conventional economic thought and calls for a transformative approach to understanding and sustaining our society.

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"The fundamental failing of socialism was the inability to innovate, as illustrated by a 1940s motorbike still being produced in Soviet Russia decades later."

Join Dr. Steve Keen as he dives into the complexities of socialism versus capitalism, drawing on historical examples and economic theories. Discover why socialism, despite its lofty ideals, struggled with innovation and how capitalism’s relentless drive for competition spurred technological advancement. Through the lens of Janos Kornai’s analysis, Keen explores the resource constraints and production challenges that shaped these economic systems. Learn about the Soviet Union’s industrial stagnation and the enduring impact of capitalist innovation on modern economies.

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Join 10,000 Other Truth-Seekers by Downloading my new ‘Funny

Join 10,000 Other Truth-Seekers by Downloading my new ‘Funny Money’ Bundle for Free at https://new.stevekeenfree.com

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If you are, the 7-Week Rebel Economist Challenge is for you. If you qualify, I will work closely with you every week to install 50+ years of real economics into you, in only 7 weeks. Working closely with the 5 best applicants this week.
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"And he actually writes, does this have significance in economics? And then he probably went home that night, and, like, that that that idea changed him. It changed him completely."

Dive deep with Steve Keen as he explores Karl Marx’s transformative insights on the labor theory of value and the dialectical tension between use value and

Join 10,000 Other Truth-Seekers by Downloading my new ‘Funny Money’ Bundle for Free at https://new.stevekeenfree.com

Are you an engineer, finance, or IT professional?
If you are, the 7-Week Rebel Economist Challenge is for you. If you qualify, I will work closely with you every week to install 50+ years of real economics into you, in only 7 weeks. Working closely with the 5 best applicants this week.
Apply here: https://apply.stevekeenfree.com

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"Money is fundamentally a threesome, and everybody gets involved."

Explore the complexities of modern monetary theory with Steve Keen as he breaks down the true nature of money in today’s economy. Discover why money is not a commodity, but rather a set of promises within a banking system. Steve Keen, a contrarian economist and research

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"There was the centralization of the economic stuff, the GOS Plan approach. I think that was where the Soviets failed, and what the Chinese realized after what they went through under Mao was you have to have that capitalist period, but they weren’t going to abandon the communist control politically of the country at the same time."

Join us as Steve Keen delves into the economic evolution of China, examining the unique blend of capitalism and political centralization that has driven its remarkable growth. Discover how China’s strategic partnerships and pragmatic policies have fostered both innovation and infrastructure development, setting it apart from Western

Joseph Firestone joins the crew this week for another fun livestream.

Joe applies his knowledge, insights, and perspectives from political science, macroeconomics (using a Modern Money Theory approach), knowledge management, organizational learning, collective intelligence, and quality management.

Website: https://www.josephmfirestone.com/

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"The tensions between our basic humanity and the capitalist machine can transform society over time."

Dive deep with Steve Keen as he unpacks Karl Marx’s revolutionary ideas and their relevance in today’s world. Discover how Marx’s concept of dialectics, and his critique of value in capitalist societies, still hold powerful insights into our modern economic systems. From ancient trade practices to today’s factories, Steve challenges us to rethink the values driving our economy.

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Who is Dr. Steve Keen?

Dr. Steve Keen is an influential economist who has dedicated over 50 years to challenging mainstream economic theories. Since his days as a university student, he

George Selgin joins Real-Time with Steve Keen & Friends this week.

George is a senior fellow and director emeritus of the of the Center for Monetary and Financial Alternatives at the Cato Institute and professor emeritus of economics at the University of Georgia. His research covers a broad range of topics within the field of monetary economics, including monetary history, macroeconomic theory, and the history of monetary thought.

Watch the full Real-Time with Steve Keen & Friends where this clip was from.

Full Show: https://www.youtube.com/live/MNpVQvgzn30?si=IyA66BpHcn_aSecI

Ann Pettifor joins up on the stream this week, and she might have some things to say about MMT.

Ann is political economist, author and public speaker. Her latest book, The Case for the Green New Deal, was published in hardback by Verso in 2019. By 2020 the book had been translated into German by Hamburger Edition, Italian by Fazi Editore and Swedish by Verbal Forlag. The English paperback version with an added chapter, Afterword, appeared on the shelves of bookstores from September, 2020. The Production of Money, published by Verso in Spring, 2017, explains the nature of money and the monetary system; tackles thorny issues like Bitcoin and QE, and is written to be accessible to a wide audience. It too was translated into German and published by Hamburger Edition and later into Spanish.

"That’s right, and so that’s what makes them interesting."

Dive into a thought-provoking journey with a critical analysis of historical and modern economic theories as unfolded in the conversation. Uncover why ancient economic insights might hold key solutions to today’s financial uncertainties and how a contrarian viewpoint can dismantle longstanding economic beliefs.

Discover how the debate of value origin—from land, labor to subjective utility—has shaped the dynamics of capitalism and why this matters to anyone interested in the future of economics.

This week’s guest is Denise Hearn, and we are going to cover a lot. So enjoy!

She advises governments, financial institutions, companies, and nonprofits on antitrust, economic policy, and new economic thinking. She is currently a Resident Senior Fellow at the Columbia Center on Sustainable Investment, a joint center of Columbia University Law School and Columbia Climate School.

Denise co-authored The Myth of Capitalism: Monopolies and the Death of Competition with Jonathan Tepper — named one of the Financial Times’ Best Books of 2018. She is the 2024 McGill University Max Bell School of Public Policy Lecturer, and co-authoring a forthcoming book with Vass Bednar on changing market dynamics in Canada.

Website: https://www.denisehearn.com/

Socialism or Dictatorship?

Time Travel Economics?

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