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In fact, there's no way that banks can be paid everything that they're owed.

Michael Hudson

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Michael Hudson
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More quotes by Michael Hudson

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Europe is acting in a very self-destructive manner, but is doing so because it's trying to be loyal to the United States.
Michael Hudson
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No price is too high to pay to try to make the financial system go on a little bit longer. But ultimately it can't be saved, because of the mathematics that are involved.
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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.
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As you have to pay more interest and amortization on what you owe, you're left with less and less money to buy goods and services - unless you borrow even more and go further into debt.
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The result of this anti-classical revolution you had just before World War I was that today, almost all the economic growth in the last decade has gone to the One Percent. It's gone to Wall Street, to real estate.
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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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When there's deflation, it means that although most markets are shrinking and people have less to spend, the 1% that hold the 99% in debt are getting all the growth in wealth and income. Deflation means that income is being transferred to the 1%, that is, to the creditors and property owners.
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Money is not a factor of production. But in order to have access to credit, in order to get money, in order to get an education, you have to pay the banks.
Michael Hudson
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Most people think of the economy as producing goods and services and paying labor to buy what it produces. But a growing part of the economy in every country has been the Finance, Insurance and Real Estate (FIRE) sector, which comprises the rent and interest paid to the economy's balance sheet of assets by debtors and rent payers.
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You have the economic vocabulary turning into vocabulary of deception.
Michael Hudson
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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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Deflation means a slowdown of income growth. Markets shrink, new capital investment and employment also taper off, so wages decline. That is what's happening as deliberate policy in Europe and the United States. Falling or stagnant prices are simply the result of having less income to spend.
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One of the big problems in America's economic polarization and shrinkage is that pensions can't be paid. So there are going to be defaults on pensions here, just like Europeans are insisting in rolling back pensions. You can look at Greece and Argentina as the future of America.
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The Eurozone die is cast. Countries must withdraw from the euro so that governments can create their own money once again, and resist creditor demands to carve up and privatize their public domain.
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The one sure mark of a con, though, is the promise of free money.
Michael Hudson
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Most banks - with Deutsche Bank at the top of the spectrum here - have decided that they can't make money lending to barrowers anymore, so they're going to the second business plan: They lend money to casino capitalists. That is, to people who want to gamble on derivatives.
Michael Hudson
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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.
Michael Hudson
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Nobody prefers to earn income any more, because that's taxable. Rich people prefer to make capital gains.
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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The problems of 2008 were never cured. The Federal Reserve's solution to the crisis was to lend the economy enough money to borrow its way out of debt. It thought that if it could subsidize banks lending homeowners enough money to buy houses from people who are defaulting, then the bank balance sheets would end up okay.
Michael Hudson