Richard Werner is quite sane here, no chemtrails, anti-vax, or covid conspiracy theories.
He believes the regulations should be changed to encourage more small banks to flourish, which would be more willing to fund small and medium sized businesses. Germany has been the most successful at this, he says, and many of these companies are very innovative in the new green technologies. It sounds good!
the Russian Proverb goes: there is nothing more permanent than a temporary solution.
As Quantitative Easing was introduced to buy Central Bankers time so they could fix the structural problems in the economy. But quickly QE became the solution to every possible economic hiccup. Temporary QE has now become the permanent problem which has juiced asset prices, created epic amounts of private debt, and left most of us poorer…
Ross Ashcroft is joined by Professor Richard Werner, who first coined the term Quantitative Easing, to discuss what went wrong.
5 comments:
“”Printin’ money!”
"As Quantitative Easing was introduced to buy Central Bankers time so they could fix the structural problems in the economy." Whaaaaat? That's news to me. Plus central banks do not have the powers to "fix structural problems....". Plus there are a VAST ARRAY of "structural problems" in any economy given the very vague nature of the term "structural problems".
What I liked was the bit about encouraging small banks and SME's, plus he did think Quantitative Easing was useful.
What regulations will encourage small banks or small firms? 'QE' is permanent in MMT, because every regulated bank is itself debenture collateral at the central bank to the value of their loan assets less the capital buffer.
That means anybody who impresses the central bank enough to get a lending licence and has sufficient capital can lend and transfer without having to hunt for deposits.
That makes 'small banks' lending agents of the central bank.
All they have are figures of speech Ralph……
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