Oliver Blanchard is a former IMF chief economist. I have no doubt that this tweet thread was issued yesterday because the IMF was talking about the UK. And he's right:
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Because the mentality of the very rich is to avoid as much as possible their share of the “retirement” of money after its “infusion.” This sets up government to be in competition with private sector banks’ money creation. The establishment of a government central bank is recognition of this false competition. Should more equitable arrangements be established to control capital in marketplace capitalism the competition would fade.
It’s nice to see a prominent person thinking like one’s self on these issues.
I saw this in the London Economic on facebook.
I noted the interest on the Coronavirus Business Interruption Loan Scheme was c.5%
It’s an ill wind….
https://www.thelondoneconomic.com/business-economics/business/banks-scoop-65-million-payday-from-3-months-of-government-backed-loans/30/10/?fbclid=IwAR2n25gDUWy2UmT1zrpNIVuDncIPPREZ7DfE8vfFpjXaTnNl3O7dZ1TbqWw
An LSE talk I heard earlier this week made a interesting case on demographic grounds, that inflation has been kept down in developed economies for two or three decades by outsourcing labour to (primarily) China, but they are approaching or past the “Lewis turning point” when unskilled rural labour capacity has been largely used up, so we will start to see wages increasing, in China and elsewhere too. Not only that, but populations are aging in China and most developed countries, so the balance of power will shift back from capital towards labour as there will be fewer working age people supporting ever more older people.
https://www.lse.ac.uk/Events/Open/202010261700/the-great-demographic-reversal
https://blogs.lse.ac.uk/businessreview/2020/09/18/the-great-demographic-reversal-and-what-it-means-for-the-economy/
Food for thought.
But there is significant unemployment….