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Steve Keen

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Never quite understood why he is deemed the economist of the people that sees what others dont.

Almost everyone on HPC pre 2007 predicted the crash, was hardly difficult to spot.

Yet this man seems to think the fuckwits that created the debt bubble should effectively be given the assets they bought from free.

Am i alone in thinking he is just another Keynesian wanker on steroids - Or better still wants Mugabeism.

 

Edited by Banned

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3 hours ago, Banned said:

Never quite understood why he is deemed the economist of the people that sees what others dont.

Almost everyone on HPC pre 2007 predicted the crash, was hardly difficult to spot.

Yet this man seems to think the fuckwits that created the debt bubble should effectively be given the assets they bought from free.

Am i alone in thinking he is just another Keynesian wanker on steroids - Or better still wants Mugabeism.

 

Keen analysis of the crisis and the prediction he made back in 05 meant he was well ahead of a lot of academic economists.

These days even the BoE accepts that banks create liabilities ahead of deposits but when Keen and others were floating these ideas,the economic establishment was in denial.

Like you though I think the whole debt jubillee thing is utter bollocks and is proof that managing the economy should not be left to academic economists

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7 hours ago, sancho panza said:

Keen analysis of the crisis and the prediction he made back in 05 meant he was well ahead of a lot of academic economists.

These days even the BoE accepts that banks create liabilities ahead of deposits but when Keen and others were floating these ideas,the economic establishment was in denial.

Like you though I think the whole debt jubillee thing is utter bollocks and is proof that managing the economy should not be left to academic economists

Academics are all `well and good` but until they have spent some time in the `real world` they shouldn't be allowed to make decisions that affect those (the majority) who do/have...very much the same for career politicians as well!

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44 minutes ago, MrXxx said:

Academics are all `well and good` but until they have spent some time in the `real world` they shouldn't be allowed to make decisions that affect those (the majority) who do/have...very much the same for career politicians as well!

I agree but its more why this leather jacket wearing money printing twat is somehow got street cred when all he is is an extreme version of someone like Blanchflower. Yes he spotted the bubble but so did I. FFS in 2003 after house prices had trebled in many places within 7 years myself and a bricklayer friend were discussing the insane bubble over a few beers and at teh local Con club, you hardly needed to be one of the chosen few to see back then something was seriously wrong.

Mugabes is mocked for doing what he suggests. I see he is even crowdfunded to continue spouting his complete bollocks, the man truly is a charlatan.

 

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2 hours ago, Banned said:

I agree but its more why this leather jacket wearing money printing twat is somehow got street cred when all he is is an extreme version of someone like Blanchflower. Yes he spotted the bubble but so did I. FFS in 2003 after house prices had trebled in many places within 7 years myself and a bricklayer friend were discussing the insane bubble over a few beers and at teh local Con club, you hardly needed to be one of the chosen few to see back then something was seriously wrong.

Mugabes is mocked for doing what he suggests. I see he is even crowdfunded to continue spouting his complete bollocks, the man truly is a charlatan.

 

You're throwing the baby out with the bath water.

A lot of non economists saw the crisis coming.The reality is that until we get the sort of non economist like Jerome Powell running our CB,we have to pick up from the academic types and let me tell you,you're better off with soemone like Keen who liekly wouldn't have got rid of Glass Steagall and loosened monetary policy in in the UK in Aug 05.

Please take the time to read the following and be grateful that he and his ilk have prodcued some transparency in the financial system.

http://www.debtdeflation.com/blogs/2009/01/31/therovingcavaliersofcredit/

 

There were others who saw it coming but the Establishment had an awful record.

 

https://www.intheblack.com/articles/2015/07/07/6-economists-who-predicted-the-global-financial-crisis-and-why-we-should-listen-to-them-from-now-on

3 hours ago, MrXxx said:

Academics are all `well and good` but until they have spent some time in the `real world` they shouldn't be allowed to make decisions that affect those (the majority) who do/have...very much the same for career politicians as well!

The political class are the real problem.Thye appoint the likes of Carney and give him the relatively free rein they do.

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I think the debt jubilee, the way he describes it, sounds more like heli-money, with a condition to pay down debt if you have it.  I'm neutral on the idea, as long as its the same sum for everyone, not just paying off debts and fuck the financially prudent.  I can see the point, in the context of a runaway debt deflation.  If it happens, I'll be down the gold shop faster than...
 

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2 hours ago, Bricks & Mortar said:

I think the debt jubilee, the way he describes it, sounds more like heli-money, with a condition to pay down debt if you have it.  I'm neutral on the idea, as long as its the same sum for everyone, not just paying off debts and fuck the financially prudent.  I can see the point, in the context of a runaway debt deflation.  If it happens, I'll be down the gold shop faster than...
 

So you give debt monkey some free money to pay off the debt and they will do it. And those of us who have worked and saved get fucked over big this time savings are as good as wiped out by hyperinflation ... and you are neutral on this idea ... FFS this is the most idiotic idea imaginable.

Edited by Banned

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2 hours ago, Bricks & Mortar said:

I think the debt jubilee, the way he describes it, sounds more like heli-money, with a condition to pay down debt if you have it.  I'm neutral on the idea, as long as its the same sum for everyone, not just paying off debts and fuck the financially prudent.  I can see the point, in the context of a runaway debt deflation.  If it happens, I'll be down the gold shop faster than...
 

The problem with his idea is that in practice,he pretty much ignored the role of forex markets in determining what said heli money will buy.

In the globalised world we live in,there are consequences to printing money,the problem is that CB's and politicians have been lulled into a false sense of security about the repercussions by Chinese/Japanese/assorted others recycling Western currency profits into Western currency bonds.

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5 hours ago, Banned said:

free money to pay off the debt and they will do it. And those of us who have worked and saved get fucked over big this time savings are as good as wiped out by hyperinflation

I'd have thought the money would go straight to financial institutions.  Hyperinflation will get you if you keep your savings in cash.  Why not stick it in something else?

 

5 hours ago, sancho panza said:

he pretty much ignored the role of forex markets in determining what said heli money will buy.

That's true.  But, in a global debt deflation... could we not see central banks acting in concert again?  Seem to have got away with it last time.

 

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9 hours ago, Bricks & Mortar said:

I think the debt jubilee, the way he describes it, sounds more like heli-money, with a condition to pay down debt if you have it.  I'm neutral on the idea, as long as its the same sum for everyone, not just paying off debts and fuck the financially prudent.  I can see the point, in the context of a runaway debt deflation.  If it happens, I'll be down the gold shop faster than...
 

Faster than a Turk can get his Lira out from underneath his mattress? :-) :-) :-)

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Just to point out that the form of a 'debt jubilee' doesn't necessarily mean his interpretation.  Like 'helicopter money' the 'obvious one' is always the exemplar, but there are other forms.  Eg:

  • Miras.¬† Essentially this knocks off 10-20% off everyone's monthly bill.¬† They can also cancel it whenever they want (unlike a proper jubilee). IMO this is baked in.
  • Forgiving certain forms of debt.¬† I'd say student loans are top of the list.¬† They could take off ¬£50k from everyone's loan (that has one) -- graduates¬†might then have a bit more cash to spend.¬†¬†¬†A bigger effect is that it¬†would feed into people feeling better off (and perhaps spending more) even for smaller 'debt jubilee' (20k, say), even though it wouldn't actually make any difference (ie, the graduate would still end up with some of the loan being written off at 30 years).¬† I'd say this is possible, but just as likely is that they'll extend loan terms etc to try to get more of the loan repaid (even with other debt jubilees going on -- student loans are odd).
  • Debt misselling.¬† There are a few areas where it could be argued that debt (loans) has been missold.¬† Cars is a good example.¬† I think there's a better than evens chance that they use this as a mechanism to boost the economy (==PPI) at some point.¬†¬†
Edited by dgul

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10 hours ago, Bricks & Mortar said:

I think the debt jubilee, the way he describes it, sounds more like heli-money, with a condition to pay down debt if you have it.  I'm neutral on the idea, as long as its the same sum for everyone, not just paying off debts and fuck the financially prudent.  I can see the point, in the context of a runaway debt deflation.  If it happens, I'll be down the gold shop faster than...
 

I think your missing the point of the Debt Jubilee. In the past the reason for it was to ensure that lenders would only lend to borrowers who would repay the loan. What would be the point of lending to someone who would wait for the jubilee period to avoid having to repay. 

How it could be introduced now without creating a perverse incentive is a difficult problem to solve. It would however be a financial punishment for imprudent lenders. 

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20 minutes ago, sleepwello'nights said:

I think your missing the point of the Debt Jubilee. In the past the reason for it was to ensure that lenders would only lend to borrowers who would repay the loan. What would be the point of lending to someone who would wait for the jubilee period to avoid having to repay. 

How it could be introduced now without creating a perverse incentive is a difficult problem to solve. It would however be a financial punishment for imprudent lenders. 

The only way that would happen is if the 'jubilee' was done as a fine/punishment for the banks.  As it stands, the standard idea of a jubilee only costs the country money (the jubilee is paid for by the state/country), and bails out the banks (from problem debt on their books).

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10 hours ago, dgul said:

The only way that would happen is if the 'jubilee' was done as a fine/punishment for the banks

Could be something like - all credit card debt over, say 5 years old, gets wiped out - the lender loses.  If they'd been charging the going rate for interest, they'd have made their money already.  I like this.

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11 hours ago, dgul said:

Just to point out that the form of a 'debt jubilee' doesn't necessarily mean his interpretation.  Like 'helicopter money' the 'obvious one' is always the exemplar, but there are other forms.  Eg:

  • Miras.¬† Essentially this knocks off 10-20% off everyone's monthly bill.¬† They can also cancel it whenever they want (unlike a proper jubilee). IMO this is baked in.
  • Forgiving certain forms of debt.¬† I'd say student loans are top of the list.¬† They could take off ¬£50k from everyone's loan (that has one) -- graduates¬†might then have a bit more cash to spend.¬†¬†¬†A bigger effect is that it¬†would feed into people feeling better off (and perhaps spending more) even for smaller 'debt jubilee' (20k, say), even though it wouldn't actually make any difference (ie, the graduate would still end up with some of the loan being written off at 30 years).¬† I'd say this is possible, but just as likely is that they'll extend loan terms etc to try to get more of the loan repaid (even with other debt jubilees going on -- student loans are odd).
  • Debt misselling.¬† There are a few areas where it could be argued that debt (loans) has been missold.¬† Cars is a good example.¬† I think there's a better than evens chance that they use this as a mechanism to boost the economy (==PPI) at some point.¬†¬†

Won't MIRAS just prop up the property bubble for a bit longer, people are used to debt, tax relief on it will only encourage them to increase their mortgage debt. This happens in Norway where the house loan is tax deductible, hence lots of Norwegians driving round in shiny new home improvements.

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11 hours ago, dgul said:

There are a few areas where it could be argued that debt (loans) has been missold.  Cars is a good example.  I think there's a better than evens chance that they use this as a mechanism to boost the economy (==PPI) at some point.

Have you got a merc on tick?
https://www.refusedcarfinance.com/car-finance/used-mercedes-finance/

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50 minutes ago, Option5 said:

Won't MIRAS just prop up the property bubble for a bit longer, people are used to debt, tax relief on it will only encourage them to increase their mortgage debt. This happens in Norway where the house loan is tax deductible, hence lots of Norwegians driving round in shiny new home improvements.

Yes.  That's why I think it is so likely.

[I don't want any of this.  I'm just saying what I think it is they'll do]

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