In summary my new faith can be understood as follows:
Government allocates capital better than the private sector, and should use interest rates, exchange rates, price fixing, price controls or whatever artifice it deems fit to ensure that capital goes to where it is properly directed.
The alpha and omega of the central bank’s proper role is to finance government spending.
Money belongs to the government, as we have seen properly demonstrated this week in Cyprus.
Property rights, the antediluvian obsession of the market fundamentalists, have been subject to a doctrinal revision “the template” as also shown this week in the eastern Mediterranean.
As a result of this new paradigm, asset prices must rise for the foreseeable future so long as Heli I decrees that the money printers keep printing. How can asset prices fall while the US central bank is printing more than $80bn a month? Even the unreformed Bundesbankers will surely grasp that if the European Central Bank did the same thing, the euro\’s problems would disappear overnight and prosperity would swiftly return to southern Europe, (Really, Germans should not be allowed into politics until they have had a primer indoctrination at either Cambridge or Princeton.)
More money creates more wealth, and more wealth, especially in real estate, creates more jobs—evidence to the contrary in Spain only represents a small setback on this road to happiness. As we all know, a rise in real estate prices leads to a massive increase in productivity, a prerequisite for an increase in the standard of living.
Services or goods provided to the population by the government, borrowing money from the central bank to pay the fellows who produce the goods that nobody needs with money that does not exist, will add tremendously to the GDP. This is a sure sign that the right policy is being pursued.
These goods and services anyway have a higher moral value than the ones produced in the private sector. One should simply compare the \”social usefulness\” (a favorite notion of Lenin and Stalin) of a nurse versus a hedge fund manager to be convinced. I rest my case.
The whole piece is very good. It’s frightening what these people are doing; no intelligent and honest person can possibly fail to see where it’s heading.
It will add to GDP, especially if (like Argentina) you also control the official rate of inflation.
Which is just another reason why GDP is a pretty crappy measure of anything at all, and the obsession with seeing it rise in nominal terms is behind much of the misdirected billions and trillions spent by governments trying to solve a problem that isn’t even there.
Poe’s Law applies. I thought this was Ritchie’s latest.
Dave (#3)
As soon as I saw mention of Lenin and Stalin I knew it wasn’t @RichardJMurphy – compare the ‘Courageous State’ with the Soviet Union and you will soon get the rejoinder:
‘I believe in democracy, why don’t you?’
As Tim has pointed out ad nauseam, Murphy’s knowledge of economics and history is so shaky it really is hard to take him seriously. The fact ue is taken seriously by so many is one of the reasons why I would have to describe him as ‘the most dangerous man in Britain’.
I don’t think anyone worth mentioning actually takes Ritchie seriously.
It’s a mistake to make too much of the pontifications of the Guardianistas. They think that the country listens to them, but in truth it’s merely that most of the time everyone’s to apathetic to protest against their latest minor insanity. When they are actually proposing a change with a noticeable impact on normal people’s lives, there’s much more motivation to resist.
Idiots like Ritchie can bluster and bloviate all they like, but it doesn’t matter if Polly and her chums take such idiots seriously or not because no-one takes them seriously themselves.
When they are actually proposing a change with a noticeable impact on normal people’s lives, there’s much more motivation to resist.
Climate Change Act, a fine piece of Guardianista legislation. Not to mention Leveson, a direct result of the Guardian having a fit of the moral vapours. Can’t recall a lot of resistance to either.
The CCA was a guardianista thing? No, it was a stitch-up from both sides. The Tory and Labour grandees are both making a fortune out of it – because what they have in common is that they’re all very wealthy.
It doesn’t matter what side it’s from it’s all about shifting the Overton Window. Every time you don’t push back; they win.