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David Marsh – Sheng’s world view: western neoliberalism ‘bankrupt’

Summary:
As central banks act, ‘independence is a myth’ Sheng recognises the social impact of central banks taking widespread action to curb upsets. ‘Central bank independence has always been a myth, like the emperor with no clothes. When push comes to shove, we have seen central banks funding government deficits carte blanche.’ Injecting liquidity ‘is the right short-term move because we are in wartime conditions of grave uncertainty. But quantitative easing has been increasingly interpreted as central banks funding the 1% through asset bubbles and taxing the savings of the middle and lower classes.’  The US debate is about rescuing the corporations, the economy or the population. ‘That’s a tough call. If the “precariat” says the money is not coming to me, social revolution is the next

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David Marsh - Sheng’s world view: western neoliberalism ‘bankrupt’

As central banks act, ‘independence is a myth’


Sheng recognises the social impact of central banks taking widespread action to curb upsets. ‘Central bank independence has always been a myth, like the emperor with no clothes. When push comes to shove, we have seen central banks funding government deficits carte blanche.’ Injecting liquidity ‘is the right short-term move because we are in wartime conditions of grave uncertainty. But quantitative easing has been increasingly interpreted as central banks funding the 1% through asset bubbles and taxing the savings of the middle and lower classes.’  The US debate is about rescuing the corporations, the economy or the population. ‘That’s a tough call. If the “precariat” says the money is not coming to me, social revolution is the next call.’

Mike Norman
Mike Norman is an economist and veteran trader whose career has spanned over 30 years on Wall Street. He is a former member and trader on the CME, NYMEX, COMEX and NYFE and he managed money for one of the largest hedge funds and ran a prop trading desk for Credit Suisse.

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