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More and more money is being extracted from of the production and consumption economy to pay the FIRE sector. That's what causes debt deflation and shrinks markets. If you pay the banks, you have less to spend on goods and services.

Michael Hudson

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Michael Hudson
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More quotes by Michael Hudson

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Debtors will seek to cancel their debts. Creditors will try to collect, and the more they succeed, the more they will impoverish the economy.
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Stocks always go down much faster than they go up. That's why it's called a crash. People who put their money into the stocks will find, all of a sudden, that stock prices are no longer being supported by the debt leveraging that's been holding them up.
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The one sure mark of a con, though, is the promise of free money.
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Governments create money and spend it into the economy by running budget deficits. The paper currency in your pocket is technically a government debt.
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That's the magic of double-taxation treaties: you can shop around for the lowest taxer.
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The IMF acts as the collection agent for global bondholders. Its projections begin by assuming that all debts can be paid, if economies will cut wages and wiping out pension funds so as to pay banks and bondholders.
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Oil is a special case. Saudi Arabia is trying to drive U.S. fracking rivals out of business, while also hurting Russia. This lowers gas prices for U.S. and Eurozone consumers, but not by enough to spur economic recovery.
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The world's politics are in turmoil, not to mention the Mideast, where the US has mounted attacks from Libya to Iraq to Syria, and ISIS is attacking governments in today's pipeline rivalry.
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If a lot of money goes into the stock market, it'll push up prices, making money for stock speculators. Then the insiders can decide that it's time to sell out, and the market will plunge.
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In real estate you can avoid ever having to pay a capital gains tax, decade after decade, century after century. When you sell a property and make a capital gain, you simply turn around and buy a new property. The gain is not taxed. It's called preserving your capital investment - which goes up and up in value with each transaction.
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When Mr.Trump says he wants to help all Americans, he means he wants to help all Americans in the 1% by really letting Wall Street get a huge debt from the 99% of the Americans. It's just the opposite of what people believe.
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The effect of metals speculation was to push up the prices that China had to pay to countries like Australia. This squeezed China. Once the speculative demand ended, all of a sudden the added production facilities that had been brought into production by the high prices went out of production again, and there was a glut.
Michael Hudson
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The economy is being run primarily by the banks for their own interest.
Michael Hudson
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Paying debt service to banks leaves less income to buy goods and services.
Michael Hudson
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Trump's junk economics is the illusion that if we cut the taxes on the wealthiest brackets, it'll all trickle down. But it doesn't trickle down.
Michael Hudson
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The companies aren't hiring, because consumers don't have enough money to buy the goods and services.
Michael Hudson
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What's bad for the frackers usually is good for the rest of the world.
Michael Hudson
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The price decline is a result of having to pay debts. That drains income from the circular flow between production and consumption - that is, between what people are paid when they go to work, and the things that they buy.
Michael Hudson
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In fact, there's no way that banks can be paid everything that they're owed.
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People are putting their money into treasuries because they worry that the risk of putting their money into the bond market, the stock market or even the money markets is very high.
Michael Hudson