Isn’t global economics easy?

There is €33 trillion saved in cash in the world right now (Allianz Global Wealth Report)
As they say, this is because the owners of that cash don’t trust the financial products available to them in the market
These people would rather lose money holding cash then invest it in financial products
If you want the surest sign of the failure of current capitalism then this is it
At the same time Scotland is crying out for investment
To replace PFI
To fund new infrastructure investment e.g. rail infrastructure
To build new social housing
To create the renewable energy infrastructure for the country
To insulate existing housing stock
Whatever you want to add to the list
The question is how can that wall money that can’t find a home end up invested in Scotland
First it needs a policy
To clear PFI
To create investment opportunities
Of any of the types noted
To create a structure for investment
Like an infrastructure bank
Or regionally
And then it needs a financing mechanism
Like local authority bonds
Or national bonds
At low rates of interest
Backed up by government guarantee
And People’s QE if necessary

That low interest bonds backed by the sovereign guarantee of a newly independent Scotland, the one which is going to print as much money as its politicians desire to spend, have to offer a better risk/reward ratio than a bank account is the one bit he seems to have missed, isn’t it?

18 thoughts on “Isn’t global economics easy?”

  1. Does the fat fuckwit think that anyone with enough nous to accumulate a little cash would give it to the SNP on a promise?

    So he proposes what? Shaft–ZaNu-style-PFI investors? Sure PFI is a lousy deal for the taxpayer but proposing mass thievery is not going to have investors queuing up. If they will shaft others they will shaft you.

    So next obviously if greedy hoarders won’t “invest” then the Curajus must step in and force them?

  2. Investors can do one of 2 things:

    1. Buy shares in an operator who is sitting on a juicy profitable PFI contract that is ripping the government off (but is backed by the government).

    2. buy a bond that pays out the old operator under the juicy PFI contract, and then gets a return based on some new, less generous deal, still backed by the same government.

    Would they be lining up for the 2nd option? Same risk, lower return.

  3. ‘So next obviously if greedy hoarders won’t “invest” then the Curajus must step in and force them?’

    That is exactly what he proposes – all that money could be put to much better use by him, and people like him, therefore it must be confiscated and used according to the states wishes….

  4. Doh – how much of that 33 trillion is already intermediated into gilts, loans, etc by the banks in which it is ‘resting’?

  5. That stream of consciousness list looks like the product of an individual who needs a course of chemical injections. It is crying out for conversion into a

    (Deranged) Mind Map; or
    a Venn Diagram or two (preferably a whole lot all superimposed on top of each other in different colours in one economic theory of everything Venn Diagram)

  6. Wasn’t he claiming recently that he was advised to be a poet when he was young and ignorant? Perhaps he is experimenting?

  7. In other news I am crying out for investment in transport (new 911 please), housing (detached house in the country will do) and energy (a log burner and supply of logs is a human right!). If I issue some bonds the investors of the world will be beating a path to my door for such a once in a lifetime opportunity won’t they?

    What you say? How am I going to make all this consumption generate a return to even pay the interest let alone return the capital? Pah, mere neoliberal sophistry, bonds are like the Field of Dreams, if you issue them, they will come!

  8. Government spends. He can say “invest” as many times as he likes; it will still be spending.

    ‘To build new social housing
    To create the renewable energy infrastructure for the country
    To insulate existing housing stock’

    There is no return on spending on these.

    ‘Whatever you want to add to the list’


  9. Has it never occurred to some of these people that holding cash has its uses.. I’m hardly going to drop into my local chippy and pay for a deep fried Mars bar with a magical Scottish government bond am I?

    33 trillion sounds like a lot, but it’s only 4,700 per head of population… that would be a less than my idea of a sensible “float” that I’d hold in case of being made redundant, or the car blowing up terminally, and having to buy another one PDQ.

  10. Just remember the State cannot create its own money: people who have done so like Lincoln to fight the Civil War and the Nazis to alleviate mass unemployment in the Thirties were messing with things beyond human understanding and consequently came to a sticky end. Don’t forget: the Earth is flat.

  11. Snippa in action:

    Graeme says:
    October 6 2017 at 10:29 am
    33 trillion works out to be about 4000 per person. Is that really such a staggering figure? If anything it seems low to me. I like to keep enough in the bank to cover a year of bills and only then seek out riskier investment opportunities. I suspect that many people have similar amounts in cash or short-term deposits. Don’t banks then lend this money out, subject to reserve requirements?

    Richard Murphy says:
    October 6 2017 at 11:57 am
    You know that is a sum beyond the imagination of the vast majority in the world?

    Do you have any clue about wealth distribution?

    Do you also have any clue about how banking works and that deposits are not lent out?

    Your comments are not just ill-informed, they show a staggering naivety

  12. How’d the Confederates creating their own money in the Civil War turn out??

    My dad once told me that there are three things you cannot buy with money: happiness, the respect of your colleagues and the love of a good woman. Of course, he added, regretfully, that’s only true if we’re talking about Confederate money …

  13. The really great joy of this is that the Confederate dollar has been rising in value against the greenback since, oohf, certainly 1970, maybe 1920.

    No more supply, see?

Leave a Reply

Your email address will not be published. Required fields are marked *