by Summary:
I wish the last one was true
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Steve Keen considers the following as important:
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I wish the last one was true
Topics:
Steve Keen considers the following as important:
This could be interesting, too:
New Economics Foundation writes Is the Labour government delivering on its promises?
John Quiggin writes Dispensing with the US-centric financial system
New Economics Foundation writes Whose growth is it anyway?
Matias Vernengo writes What is heterodox economics?
| I wish the last one was true |
I see the point, but I have no idea, how this debt can rise to this level.
The job of the banks is to take care that it does not.
Credit is very simple: I can buy as much now as much I can give later.
In some cases, things may not go like expected. But this can be handled like an insurance: others step in to fill the gap.
So when banking is done right, this problem never should appear.
Yes maybe you can. But if a million people do it at the same time then things work different.
And debt levels for an economy grow exponentially but GDP doesn't. There will then always be a crunch. That's Michael Hudson his point.
@@webfreakz why should it make a difference, when million people do it? The net effect of credit is: you buy from yourself and if you can produce, there is no problem.
And I do not see, why the debt level should grow at all. And gdp does grow exponentially, when you do have eg. 2% growth. gdp growth in Germany since 1950 looks very exponential.
@@ThomasVWorm When basic living goes up faster and is more expensive that wages they get, people will go into debt they can not pay back.
@@glenwarrengeology but this would only happen if banks do not understand their job. It makes no sense to give a loan to somebody, who is not able to pay it back. It is like lending your car to someone who is known for not giving it back.