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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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Michael Hudson
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More quotes by Michael Hudson

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The ideological foundation of today's business schools is that economic control should be shifted out of government hands into those of financial managers - that is, Wall Street.
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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.
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A derivative is a bet on whether a stock, or a bond or a real estate asset, is going to go up or down. There's a winner and a loser. It's like betting on a horserace.
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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.
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The companies aren't hiring, because consumers don't have enough money to buy the goods and services.
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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.
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Paying debt service to banks leaves less income to buy goods and services.
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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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In China the largest denomination bill they have is 100 yen, and that's maybe $7. So here you have a whole economy working with only a $7 note as the largest denomination. The euro wants to get rid of the 500-euro bill just as the United States years ago got rid of the $1,000 bill because only the criminals used $1,000 bills.
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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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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.
Michael Hudson
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If the economy is growing, people want to employ more workers. If you hire more labor, wages go up.
Michael Hudson
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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.
Michael Hudson
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The one sure mark of a con, though, is the promise of free money.
Michael Hudson
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Actually, high housing prices don't help the economy. They raise the cost of living.
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.
Michael Hudson
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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
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The real estate interests and banks are in a kind of symbiosis. They're the largest-growing part of the economy. This is the sector that backs the political campaigns of senators, presidents and congressmen, and they use this leverage to make sure that their people dominate the Federal Reserve, Treasury and the federal housing agencies.
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I think the Republican tax law is so bad that it almost guarantees a Republican victory, precisely because it's so bad. The seeming irony is that it's so bad that it enables the Democratic Party to think, A-ha, all we have to do is be the lesser evil.
Michael Hudson
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The economy is being run primarily by the banks for their own interest.
Michael Hudson