Steve Keen on BBCs radio 4

  By emma | August 4, 2012 - 02:47 |

http://www.bbc.co.uk/programmes/b01j5h51

Written by: emma on August 4, 2012.
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  • Joebhed

     The site has blocked you from posting new comments.

    • lgrinaker

      This happened to me once a few weeks back, so I’m guessing this was not an intentional block.

      Linda

  • Joe bongiovanni

    Keen has here definitely punched with the LSE crowd.

    I almost never disagree with Keen’s macro-economic
    observations – just with his lack of political clarity within those economic
    observations, and in his solutions – let’s get ready to do it all again.

     

    “Money is created by the financial system itself.”

    “Money is not controlled by the Central Bank”.

    “Money is generated by the private financial sector, and
    there are really no effective constraints on the rate at which they can
    increase that growth.”

     

    The reason Keen cannot properly identify a long-term
    solution is because he fails to comprehend the reality of all that MONEY being
    created as a debt.

    There is no money.

    There is only debt.

    A sign to me that he hasn’t read Soddy’s “The Role of
    Money”.

     

    Rather he falls back on the “endogenous” money definition.

    Which is that money is created when banks make loans, and
    banks only make loans when somebody asks for a loan. Thus, money is demand-driven.

    And, all bankers do is make it happen.

     

    I totally agree with his observations on where we are in the
    CRASH-curve because the bankers ARE only very slowly liquidating themselves of
    their toxic assets.

    But I think his Debt-Jubilee solutions are less realistic
    than the nationalization of the money system, which would ensure that the
    crisis can never be repeated.

     

    For the Money System Common.

    • http://overthepeak.com/wordpress/ Mystic

       Hey Joe,
      What particularly don’t you like about -
      “Rather he falls back on the “endogenous” money definition.

      Which is that money is created when banks make loans, and banks only make loans when somebody asks for a loan. …… Thus, money is demand-driven.

      And, all bankers do is make it happen.”
      ~?~

      • Joe bongiovanni

        Nick

        Thanks.
        Without being simplistic, Keen’s view of money-creation is
        that it is all about a kind of natural process of financial intermediation,
        embracing the ‘endogenous’ money construct of Lavoie and MMT. From there, you
        will never find the source of the problem that such a system truly engenders.
        The source of the GLOBAL debt saturation problem is in the debt-based construct
        of ALL the money.

        Keen’s view is that this debt-saturation problem is derived
        from a group of bad actors, doing bad things enabled by bad financial
        regulation.

        Lacking a “systemic” cause, his solutions are clearly
        symptom-relief and not a cure.

        Thus, a debt-jubilee and new financial asset definitions.

         

        I could say that this error is founded in both MMT and
        MRs(thanks, Linda) fundamental error in defining money as debt, using Innes as
        the footing of that foundation.

         

        Zarlenga has done a pretty detailed critique of Innis
        position as being poorly founded, being not legally and science-based, hoping
        for an advancement on the “money” dialogue. Still hoping.

         

        I often cite Soddy and I use his image as my Ava because
        what he has taught is truly about what IS that ‘nature’ of money. His is the
        most fundamental construct of what money must be in order to have a functioning
        economy of resource-derived wealth, with the money system serving the
        ‘exchange’ function as the distributive mechanism.

         

        If one never reads Soddy’s “Wealth, Virtual Wealth and
        Debt”, then one can believe that  debt-derived wealth is achievable. It is not.

         

        If one never reads Soddy’s “The Role of Money”, so that an
        understanding can first be established about the function of a system of money
        in a national economy, then one can easily get lost in double-entry bookkeeping
        gyrations, and in the accounting identities related to modern money mechanics.
        That’s where MMT is at.

         

        The problem is systemic.

        The solution is systemic.

        For the Money System Common

        • http://overthepeak.com/wordpress/ Mystic

           My next two posts should open up some more discussion points.

          The main problem is, that the system we have, has done us well for hundreds of years~!

        • lgrinaker

          I’ll put Soddy on my “to do” list, Joe, ;-).

          Linda

    • lgrinaker

      Joe, I hope this is OK with you, but I want to post the interview with Keen when he was interviewed back in 2010 at the gathering for American Monetary Reform, when he was asked for his criticism of the solution put together by AMR, having been invited to speak at the conference; and then, a short time afterwards, in “Coffee with Joe,” your rebuttal of that criticism.

      Linda

      • http://overthepeak.com/wordpress/ Mystic

         But don’t forget (and this is why I like him), Keen has different ideas today.

      • Joe bongiovanni

        Sure, Linda.
        Not exactly sure what’s in there.
        Thanks.