On the other side of the ledger we’ll be starved of interest income to the same degree... ie lowest in 50 years...
Net interest costs on deficit are expected to reach as low as 1.14% of GDP in 2024, which would be lowest in 50 years @biancoresearch @USCBO pic.twitter.com/Z8etMyzPgZ
— Liz Ann Sonders (@LizAnnSonders) January 7, 2021
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On the other side of the ledger we’ll be starved of interest income to the same degree... ie lowest in 50 years... Franko
What you mean is welfare proportional to account balance since the debt of a monetary sovereign like the US is inherently risk-free.
Moreover, large and non-individual-citizen users of a monetary sovereign's debt (including so-called "bank reserves"), a public utility, should PAY for that privilege via negative interest and yields.
I ofc completely disagree....
Both privileges for the banks and non-negative yields and interest on large and non-individual-citizen users of inherently risk-free sovereign debt, a public utility, are holdovers from needlessly expensive fiat (e.g. the Gold Standard), which is inherently obsolete and corrupt.
Andrew, On the subject of privileges for banks, I recently stumbled across a short aricle by Thomas Hoenig, former vice chairman of the FDIC which might interest you:
https://www.fdic.gov/about/learn/board/hoenig/govsubsidy.pdf
The safety net’s protection should be limited primarily to those commercial banking activities for which it was originally intended: stabilizing the payments system ... from https://www.fdic.gov/about/learn/board/hoenig/govsubsidy.pdf
Baloney since we should have TWO payment systems:
1) an inherently risk-free payment system consisting of accounts for all at the Central Bank itself.
2) an AT-RISK payment system that works through UNINSURED private depository institutions.
and the intermediation process between short term lenders and long-term borrowers. That is, it should be confined to protecting activities essential to a well-functioning economy. ibid
More baloney since systematic oppression of the poor via government privileges for the banks and, by extension, for the rich, is a road to recurrent ruin.
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