Michael Hudson: QE, Neofeudalism and Privatization — The End of Consumer Choice

capitalism is the crisis

Image by Alex Cameron via Flickr

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
October 20, 2013

In Extraenvironmentalist #67 we discuss the implications of the bursting global credit bubble with economist and historian Michael Hudson. Our conversation covers many of the themes in Hudson’s new book, The Bubble and Beyond which covers the process of quantitative easing, neofeudalism and more.

Continue reading

Keiser Report: Michael Hudson: Working Class Debt Slaves

capitalism

Image by Mary Crandall via Flickr

with Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
October 5, 2013

RT on Oct 5, 2013

In this episode of the Keiser Report, Max Keiser and Stacy Herbert, discuss David Cameron as a Special Purpose Vehicle (SPV) which causes the wealth of the nation to drop. They also discuss Continuous Payment Authorities as a metaphor for our financial systems continuously taking toll payments, whether via interest fees or inflation.

Continue reading

F is for FIRE Sector by Michael Hudson

f plate 3

Image by Jeremy Brooks via Flickr

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
September 23, 2013

Part F in the .

Factoid: A hypothesis, rumor or story so consonant with peoples’ preconceptions that it is accepted as a fact or working assumption, even though it often is made up a priori. Among the most notorious examples are the ideas of diminishing returns, equilibrium, that privatized ownership is inherently more efficient than public management, and that trickle-down economics works. (See Junk Science.)

Continue reading

E is for Earned Income by Michael Hudson

E

Image by steve.wilde via Flickr

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
September 16, 2013

Part E in the .

Earned income: Wages or profits earned by labor or capital for their role in producing goods and services. As such, earned income excludes economic rent and interest, which are property and financial returns that must be paid out of profits and wages.

Continue reading

D is for Debt by Michael Hudson

D

Image by chrisinplymouth via Flickr

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
September 8, 2013

Part D in the .

Debt: Only pure assets and equity ownership exist without corresponding debt. For financial saving, one party’s saving deposit, loan or credit appears as another party’s debt on the opposite side of the balance sheet. (Even net worth appears on the liabilities side of the balance sheet.)

Continue reading

C is for Camouflage by Michael Hudson

letter C

Image by Leo Reynolds via Flickr

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
August 10, 2013

Part C in the .

Camouflage: A cloak of artificial attractiveness or even of invisibility. Financial debt-claims on the economy’s income and assets camouflage themselves as wealth, although the financial tactic is to strip it. (See Euphemism and Parasite.)

Continue reading

B is for Bailout by Michael Hudson

B

Image by chrisinplymouth via Flickr

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
August 7, 2013

Part B to the .

Bailout: Reimbursement to speculators and savers of losses incurred by bad loans, investments or deposits in banks that fail. The effect of this moral hazard is to preserve financial control in the hands of the economy’s wealthiest 10 percent, “making them whole” by shifting the loss onto the bottom 90 percent of the population in order to benefit those at the top of the pyramid (see Rentier and Oligarchy).

Continue reading

Obama’s Master Class in Demagogy 101 by Michael Hudson

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
July 25, 2013

Day 7 Occupy Wall Street September 23 2011 Shankbone 2

Image by david_shankbone via Flickr

Yesterday President Obama chose Knox College in Galesburg, Illinois (originally founded by anti-slavery activists in the 1830s) to float the economic program he has been working out with Wall Street investment bankers. His aim is to wrap this program in a democratic rhetoric. The speech’s actual content boils down to: “I’m doing fine and housing prices are recovering. The way to heal the economy faster is to make a Public-Private Partnership (with Wall Street) to finance new infrastructure investment. The government will guarantee a return – and if there’s any loss, we (you taxpayers) will bear it.” His political genius was not to sugar-coat the shady parts of his proposals.

Continue reading

China – Avoid the West’s Debt Overhead: A Land Tax is Needed to Hold Down Housing Prices by Michael Hudson

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
July 22, 2013

How can China avoid the “Western financial disease” – a real estate bubble followed by defaults and foreclosures? The U.S. and European economies originally sought to avoid this fate by taxing the location’s site value. A rent tax was the focus of Progressive Era reforms.

Enacting a rent tax remains China’s main challenge to accompany its privatization of real estate and natural resources. If land rent were fully taxed, it would not be paid to banks as interest for rising mortgage loans – and governments would not have to tax income and sales. Holding down housing debt will reduce labor’s cost of living, but not its living standards.

Continue reading

The Insider’s Economic Dictionary – Part A by Michael Hudson

letter A

Image by Leo Reynolds via Flickr

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
July 18, 2013

Part A in the .

The Antidote to Euphemism

The fallacies that lurk in words are the quicksands of theory; and as the conduct of nations is built on theory, the correction of word-fallacies is the never-ending labor of Science. … the party in this country, one of whose great aims was, at one time, the perpetuation of slavery, owed much of its popular vote to the name Democracy.
– S. Dana Horton, Silver and Gold (1895)

Continue reading

Michael Hudson: Game Over for Our Post-Feudalistic Economy

It's Capitalism.

Image by eyewashdesign: A. Golden via Flickr

with Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
July 21, 2013

CapitalWatch on Jul 20, 2013

Here’s what’s in your Prime Interest today:

Insolvent! That would be Detroit, which gave us the Supremes and the vehicles that fueled our happy motoring paradise for decades. Unfortunately, after years of decline, the Motor City finally filed for bankruptcy protection yesterday — a move that was not entirely unexpected. That’s right — $18 billion in liabilities is at stake — a record for the US. Is this the first domino that might just validate Meredity Whitney’s 2011 prediction of a wave of muni defaults? Continue reading

The Bubble Economy as a 2 Part Play for Privatisation by Michael Hudson

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
July 4, 2013

Abandoned Las Vegas 2

Image by JoeInSouthernCA via Flickr

As published in the latest World Economics Association digest, the Real World Economics Review

The Federal Reserve’s QE3 has flooded the stock and bond markets with low-interest liquidity that makes it profitable for speculators to borrow cheap and make arbitrage gains buying stocks and bonds yielding higher dividends or interest. In principle, one could borrow at 0.15 percent (one sixth of one percent) and buy up stocks, bonds and real estate throughout the world, collecting the yield differential as arbitrage. Continue reading

Michael Hudson: What is Debt Deflation?

with Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
May 18, 2013

Strike Debt Rolling Jubilee

Image by The Eyes Of New York via Flickr

RussiaToday May 18, 2013

In this episode of the Keiser Report, Max Keiser and Stacy Herbert examine stories about those who, using spoof trades, bogus securities and fictitious capital, steal real wealth and income. They discuss how it is that every benchmark index is rigged and introduce the concept of the ‘bonus benchmark.’ In the second half, Max talks to Dr. Michael Hudson, author of The Bubble and Beyond, about debt and wage deflation and about the intersection of interest rates and wages going back to David Ricardo when wages were measured against the price of bread to today when they are measured against the price of debt.

Continue reading

Failed Privatizations — The Thatcher Legacy by Michael Hudson

Baroness THATCHER of Kesteven  (13 October 1925 – 8 April 2013)

Image by The PIX-JOCKEY (photo manipulation) via Flickr

by Michael Hudson
Writer, Dandelion Salad
michael-hudson.com
April 8, 2013

This is from my book on privatization, written some 15 years ago, never published.

As in Chile, privatization in Britain was a victory for Chicago monetarism. This time it was implemented democratically. In fact, voters endorsed Margaret Thatcher’s selloff of public industries so strongly that by 1991, when she was replaced as prime minister by her own party’s John Major, only 35 percent of Britain’s voters supported the Labour Party – half the proportion registered in 1945. The Conservatives sold off public monopolies, used the proceeds to cut taxes, and put the privatized firms on a profit-making basis. Continue reading

Mrs. Thatcher’s Mean Legacy by Michael Hudson and Jeffrey Sommers + Thatcher Gave More Power to Finance

by Michael Hudson and Jeffrey Sommers
Writer, Dandelion Salad
michael-hudson.com
April 8, 2013

"I Can't Believe It's Not Thatcher" - public sector march against pension cuts - London, 30 June 2011

Image by chrisjohnbeckett via Flickr

We typically honor the convention to refrain from to speak ill of the recently departed. But Margaret Thatcher probably would not object to an epitaph focusing on how her political legacy was to achieve her professed aim of “irreversibly” dismantling Britain’s public sector. Attacking central planning by government, she shifted it into much more centralized financial hands – the City of London, unopposed by any economic back bench of financial regulation and “free” of meaningful anti-monopoly price regulation.

Continue reading