Money and Banks

It's easy to dismiss MMT out of hand, but the impulse to create something from nothing resides deep in the human psyche.

It is possible to conceive of a world where fractional reserve banking is understood by both banker and depositor and involves no deception or fraud. But in that world, deposits cease to be money and become complex credit securities.

Central bank policies that rely on ultralow interest rates have been shown to bring economic stagnation. Unfortunately, central bankers don't seem to have any other ideas.

The largest fiscal and monetary support plan since WW II has been instigated with two dangerous collateral effects: the rise of zombie companies and the collapse of small businesses and startups.

Central bank policies that rely on ultralow interest rates have been shown to bring economic stagnation. Unfortunately, central bankers don't seem to have any other ideas.

The EU has now become essentially a makeshift, lawless regime designed to prop up bankrupt states. So much so, in fact, that even the German supreme court has become alarmed.

By protecting banks from the costs of poor investment decisions, central banks encourage further risk taking and malinvestment. They also prevent liquidation, which brings failed businesses' assets to the market at bargain prices, allowing new businesses to emerge from the detritus.

When governments and central banks announce massive stimulus packages at the very beginning of a crisis, they bet on a speedy recovery and a return to normal as if nothing had happened. This is far from the case.

When governments and central banks announce massive stimulus packages at the very beginning of a crisis, they bet on a speedy recovery and a return to normal as if nothing had happened. This is far from the case.