Modern debt jubilee or system meltdown - Steve Keen

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Paul Buitink talks to independent economist Steve Keen. A modern debt jubilee is needed says Steve due to unprecedented levels of private debt. It entails creating fiat money to get rid of the debt burden. Steve explains the difference between ancient and modern debt jubilees .
Both households, banks and corporates will benefit from a debt jubilee. Also small companies can get the helicopter money. And corporate debt can be swapped into shares. Steve is in favour of central bank digital currencies but doesn't want to abolish cash.
They explain what the effects on commercial and central bank balance sheets would be. Steve brought also a few charts showing M2 velocity and private debt growth vs GDP.
The choice basically will be between a modern debt jubilee or a system meltdown.
Steve and Paul discuss about the aftermath and how the new financial system would look like and whether it would be good to have competing financial models and currencies.
Steve would like a greener and more sustainable society. We need more physical austerity. He also thinks the crisis will strengthen fiat money and the push for universal basic income.
The gentlemen also discuss bitcoin and the problems within in the eurozone.

[@budawang77]

Why aren't more people talking about a debt jubilee? Neoliberalism is doomed.

[@webfreakz]

Because everybody is terrified of inlation. It's just the narrative. Doesn't mean the inflation will happen.. it's just been so engraved into our brains that it'll be very hard to convince the public to do a debt jubilee.

[@econrith]

They think that every scrap of government spending is to be charged to the tax payer. It gives them nightmares at night. They are seemingly incapable of recognising that there could be another way to do things given that money is a man made construct. We need a song called "Why you hate me so much" ?

[@MaryOKC]

A coworker brought this up 2 years ago and is pretty convinced it’s going to happen under the Trump administration. ..Biden hasn’t won.

[@webfreakz]

Bedankt Paul, I always enjoy listening to Prof Keen!

[@panjasaram5266]

GUTY;::65:::🙋🙋🙋🙋🐇🐇🐇CS

[@MnemonicCarrier]

I'm seriously considering buying tent, or a vehicle that has room for a mattress in the back. I'll make a list of nearby facilities (showers, toilets, power sockets), but will use the facilities available in the office (when the office opens up again and people return to work). So I'll have my laptop, my phone (which has an unlimited Internet plan), a place to sleep, and a bike to get around on. I'll just hand-wash my clothes in the shower and restrooms. I'd love to try it out for a year, just to see how it goes.

[@joyoverley5259]

Find how others do this well on KZbin,at "cheap rv living" you will find many who live in their cars.

[@josepharnita2748]

had 2 credit card with a balance of$ 8,400.00 checked my credit report because i got no calls or bills last month. both are in arrears. the accounts are gone. totally gone. this is awesome.

[@Highvibes777]

Ready for my debt to go away...

[@colinbrigham8253]

Many thanks prof keene watched you fence with bit coin nut max over the years many thanks again

[@simonwiltshire7089]

What I cant understand about a debt jubilee is that on the other side are for eg pension funds - what happens to the income for those people? The lender-borrower relationship is much more convoluted. Happy to have it explained to me. (PS - has someone got a $million to lend which they are happy to not have paid back?)

[@Asmodai2011]

Let the debtors go bankrupt. Prices will drop and savers can buy in low. Why reward mistakes? Savers should be rewarded by the deleveraging and falling prices. Debts should not be forgiven. They can go through the bankruptcy process and reapply for credit within a few years. The element of loss can not be eliminated. It must be present at all times to keep the game fair.

[@First_Principals]

Mode debt jubilee, land value tax, minimum ownership of the all financial assets of 24hrs. National currency should be local and then we should have several international currencies like SDR's, crypto, gold, basket of currencies or commodities International trade could be done using smart contracts and any of the payments above or even local currencies traded Internationally. Crowd funding using the pre order model. Open source hardware, machinery and software. Patents copyright and trademarks to only last for a shirt period of time.

[@WilliamThomasWales]

This would only increase the wealth gap further with inflation of asset prices. The answer to to much debt is not more debt! The theory that governments can borrow as much as they like FOREVER is farcical. Confidence will eventually be lost.

[@markhingston3024]

I am confused. Steve Keen says every time banks create a loan they make an entry on their balance sheets which "creates" say most of that debt out of "thin air" and the balance is parked with the central bank as security in case of a bank run. So you go to the bank and ask for a loan of $100x. You have $10x as equity. If you seem credit worth then your ability to repay the money is the security. Not recurring incoming deposits. But in my old economics classes, and I believe even now, we were taught that the bank receives a deposit of $X which at that point equals the money supply. Then they lend out say 90% of $x. So now you have $x times 190% money supply. Then banks keep doing that to grow the supply of money. The two explanations are at odds. One relies on your ability to repay being given a monetary value on the bank's balance sheet. The other relies on cash recirculating almost 100 fold to make that bank loan possible. And this second option brings into question the speed at which money circulates. Also, if the banks need that money back in their system fast, then how can lowering interest rates help that? Let's not get into negative interest rates at the moment or my head will explode! Can't we just look at the books of a typical bank and analyze what really happens physically rather than pretend only the "chosen ones" are privy to the "dark arts of banking"?

[@markhingston3024]

@kbail If I look up the videos you are referring to, no matter how excellent, they are still their story about what happens in the banking world which Steven Keen disputes. So it comes down to his word against theirs.

[@acfpckt]

#bitcoin

[@aprilwind6015]

According to gaap generally accepted accounting practices manual for Banks cannot loan money, when men go to a bank to make a loan they create a promissory note the promissory note is taken to the fed's the fed's cash the promissory note deposited into the bank fractionalizing it nine times taking the money promissory note that you first created back to the feds for the 3-day rescission act making it looking like you didn't borrow anything from the feds now you owe the money to the bank but it was yours promissory note to begin with. We the people the men and women really create the

[@paulinehopps1231]

nesara/gesara!

[@jeremiahcastro9700]

The idea of Steve Keen has got to be the most foolish thing I've heard in a while concerning economics. Creating "government money" (i.e. printing money) to equal the amount of credit in the system will not eliminate debt but instead make it worse. In the short term this method will seem like it "eliminates" consumer debt but, in reality what will happen is that the government will still have debt and then the question becomes, *"Who will pay the governments debt?"* seeing that government has no money to pay its debts they turn to the people and borrow from with a promise to pay them back. In the United States I think the only person I can recall who successfully paid the people back was Andrew Jackson, and he brought our nations debt to zero under his leadership. Sadly this did not eliminate the greed and folly of the borrowers and lenders and now we are *$22,000,000,000,000.00 Trillion Dollars* in debt today. A debt jubilee as prescribed in the _Bible_ is not the same as the one conducted by the kings in Babylon. This debt jubilee benefited the people as a whole and only destroyed those whose business relied on greed and debt to "succeed". So this false notion of the financial system "collapsing" is stupid as history clearly has shown that the kingdoms which implemented debt forgiveness didn't have their kingdoms or their institutions "collpase", rather, only a few greedy creditors died off.

[@mikecobb2082]

So here is my question..let's just say that this is all true.so do people still work and keep all money?or do they just go and have fun and not work

[@mikecobb2082]

Who said anything about I was worried .it s question that only each individual can answer

[@joebhed1]

OK folks, let's pretend we actually understand what Steve is saying, and speak English to re-phrase ' the debt-jubilee solution. Please go back and listen from 4:00 to 4:38 or so. And then again. And then again. What's it about, Steve ??? . 1. Agree with Michael Hudson. 2. We can use the government's money-creation capability (?*) - not to pay debts, but to 'offset the debt ' with money created by the government sector, so what you do is you create a large amount of fiat money and use it to replace a large amount of credit money and with that we can get rid of the debt burden and get the economy to start working again. yadda yadda. Got that? In this iteration, Steve does not opine that Guv should borrow and repay private debt, but more of an impossible alchemic type of transformation. Create a large amount of fiat money - (hint) there is NO provision for government to create and issue any money - not since Greenbacks- and Hudson opposes Kucinich's proposal to grant that power to government and favoring the trash-money-talk of MMT. Sooooooo, then, the Guv creates new money and gives it to the debtors - exactly what Kucinich (and Kumhof, have proposed. WTF ?? Follow that illogic - we're looking for a new e-wallet on here ..... GAWD. Find out what money is. monetaryalliance.org END monetary ignorance. For the money system common.

[@ShootingStar466]

As a single female who has paid off all my debts and has been struggling to save a deposit to buy a house for several years while all my friends are mortgaged and credited up to the hilt, I have to be honest and say that I would be bitter if a debt jubilee happened because it just seems so unfair and rewarding irresponsible behaviour. But at the same time, I can understand why this would be needed. Nevertheless, I still would feel like the loser. 🤷‍♀️

[@mevr.wilpalen1209]

I'm in the same boat. Steve said in the video part about a possible bail-out/helicopter money for everybody, that everyone would receive the same amount, and the ones not in debt would be forced to buy company shares. If only the debtors are bailed-out, I would def be furious.

[@bradbell4022]

Savers would be in a prime position. The debtors have to hand the money to creditors. Not fun. Savers would get to keep theirs and spend it however they like

[@ronfesta771]

Wasn't this the., professor that sold his house in Surry Hills......just before the boom!@!?😎😎😉😂

[@markhingston3024]

Steve Keen seriously underestimated the Government's ability to manipulate the real estate market in Australia Even now they are doing it to distract from covid and the China trade war. And it's actually still working at the moment. But when it stops working God help us. Australian Governments have relied heavily on this economic sugar rush to get us through tough times.

[@econrith]

5:32 The banks only get in to trouble on account of government requirements for their reserves which ironically they produce for them in any case. The fed is currently feeding banks reserves who prefer not to lend at present but are kept "fueled" with income at 1.4% or some such. The banks don't actually need any reserves in order to create the deposits they do since that is done of thin air at the banks ledger in front of an interesting array of good candidates for ongoing payments, never once do they say "oops, better check my reserves"

[@mbabazi.o]

You have to face a Holy GOD on judgement day. HE sees lust as adultery (Matthew 5:28) and hatred as murder. (1John 3:15) will you be guilty? JESUS took your punishment on the cross, and rose again, defeating death to save you from hell. Please, Repent (Luke 13:5) and trust in JESUS today. May GOD soften you heart to receiving JESUS CHRIST, our Redeemer, as your personal LORD and Savior. Please, Repent and trust in HIM today.

[@mughat]

Steve Keen is off the rails. Free markets and personal responsibility is the moral option. As opposed to his kind of philosopher king manipulating of the economy for the "greater good". Collectivism is evil.

[@MnemonicCarrier]

Yeah "free markets" are awesome if you're close to the 0% interest rates spigot.

[@MnemonicCarrier]

@Redpill Progressive I agree - but I also truly believe we need another form of money. Fiat can be manipulated too easily. If you're not "connected", chances are the deck will be stacked against you. The concept of Bitcoin offers something that fiat money cannot - sovereignty. Imagine that - a form of wealth that cannot be confiscated. A form of money that you can spend where you want, when you want. The ability to transfer as much as you want to someone else on the other side of the planet without having to worry about a bunch of middle-men who all want a slice. Bitcoin doesn't quite deliver, yet, but I think it's a step in the right direction.

[@MnemonicCarrier]

@Redpill Progressive I kinda agree with you. It's a strange one. I got involved in Bitcoin a long time ago - not because I wanted to profiteer from it, but because I was an idealist who believed crypto was the future. The first thing I purchased with Bitcoin was a sandwich and a can of coke at a cafe. As the years rolled by, I used Bitcoin to purchase various other things online, like laptops and desktop PCs. When the price of Bitcoin skyrocketed, I cashed out (and bought a few houses and apartments, a couple of cars etc...). I wasn't "trying" to make money from Bitcoin - I would have been much happier if mass adoption was reached and I was still buying sandwiches and coffee and IT equipment with it. I sold everything because I didn't agree with what Bitcoin had turned in to - basically a pump 'n dump platform, filled with greedy people who just wanted to make a quick buck.