Michael Hudson Quotes About Economy

Quotes about: Economy

There are many ways to create economic suicide on a national level. The major way through history has been through indebting the economy. Debt always expands to reach a point where it cannot be paid by a large swathe of the economy. This is the point where austerity is imposed and ownership of wealth polarizes between the One Percent and the 99 Percent.

Michael Hudson

Suicide, Wealth, Economic

Source: www.counterpunch.org
Debts grow and grow. And the more they grow, the more they shrink the economy. When you shrink the economy, you shrink the ability to pay the debts, so it's all an illusion that the system can be saved. The question is, how long are people going to be willing to live in this illusion?

Michael Hudson

Long, People, Debt

Source: www.counterpunch.org
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

Running, Economy, Currency

Source: www.counterpunch.org
The most serious problems lie in the financial sphere, where the economy's debt overhead has grown more rapidly than the 'real' economy's ability to carry this debt. [...] The essence of the global financial bubble is that savings are diverted to inflate the stock market, bond market and real estate prices rather than to build new factories and employ more labor.

Michael Hudson

Real, Lying, Essence

"Financial Capitalism v. Industrial Capitalism". michael-hudson.com. September 3, 1998.
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.

Michael Hudson

People, House, Balance

Source: www.counterpunch.org
Actually, high housing prices don't help the economy. They raise the cost of living.

Michael Hudson

Cost Of Living, Helping, Economy

Source: www.counterpunch.org
I don't think that governments should permit speculation in raw materials, because they're what the economy basically needs.

Michael Hudson

Thinking, Government, Needs

Source: www.counterpunch.org
Throughout history, the only way of restoring stability is to write down the debts. That is treated now as if it's something that can't be done. But it's the only thing that's going to revive the economy.

Michael Hudson

Writing, Done, Debt

Source: www.counterpunch.org
From 2008 to 2016 all the growth in the American economy, all the growth in national income, was earned just by the wealthiest 5% of the population. So they got all the growth. 95% of the population didn't grow. If you can get a flat tax or other lower tax, as Trump is suggesting, then this richest 5% will be able to keep even more money. That means that the 95% will be even poorer than they were before, relative to the very top.

Michael Hudson

Mean, Growth, Population

Source: www.counterpunch.org
Today's national income statistics make it appear that Goldman Sachs is productive. As if Donald Trump plays a productive role. The aim is to make it appear that people who take money from the rest of the economy without working are productive, despite not really providing any service that actually contributes to GDP and economic growth.

Michael Hudson

People, Growth, Economic

Source: www.counterpunch.org
Canada is a malstructured. You could almost call it a failed economy, except that its natural resources are so rich that everybody can get wealthy off making holes in the ground and digging up the oil and polluting the environment.

Michael Hudson

Environment, Rich, Natural

Source: www.counterpunch.org
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.

Michael Hudson

Real, Agency, People

Source: www.counterpunch.org
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

Country, Real, Thinking

Source: www.counterpunch.org
People think of a business cycle, which is a boom followed by a recession and then automatic stabilizers revive the economy. But this time we can't revive. The reason is that every recovery since 1945 has begun with a higher, and higher level of debt. The debt is so high now, that since 2008 we've been in what I call, debt deflation.

Michael Hudson

Recovery, Thinking, People

Source: www.counterpunch.org
What do the 5%, or the 1% actually use their money for? They lend it back to the economy at large, they load it down with debt. They make their money by lending to the bottom 95%, or the bottom 99%. When you give them more after-tax income, it enables them to buy even more control of government, even more control of election campaigns. They're not going to spend this money back into the goods-and-services economy.

Michael Hudson

Government, Giving, Income

Source: www.counterpunch.org
So we are in for years of debt deflation. That means that people have to pay so much debt service for mortgages, credit cards, student loans, bank loans and other obligations
that they have less to spend on goods and services. So markets shrink. New investment and employment fall off, and the economy is falls into a downward spiral.

Michael Hudson

Fall, Mean, People

Source: www.counterpunch.org
We're living in a world that's divided into two economies: the economy of the 1%, and the economy of the bottom 99%. I guess you could be more "centrist" and say the top 10% versus the bottom 90%. But there's definitely a stratification at work here.

Michael Hudson

World, Economy, Bottom
I think we're in the take-the-money-and-run stage of the economy. So the banks may go under, but the bankers, who make the policy, clean up.

Michael Hudson

Running, Thinking, Bankers

Source: www.counterpunch.org
More and more money is being extracted from of the production and consumption economy to pay the FIRE sector. That's what causes debt deflation and shrinks markets. If you pay the banks, you have less to spend on goods and services.

Michael Hudson

Fire, Debt, Pay

Source: www.counterpunch.org
We're at the end of long cycle that began in 1945, loading the economy with debt. We're not going to be able to get out of it until you write down the debts. But that's what the IMF believes is unthinkable. It can't say that, because it's supposed to represent the interest of the banks.

Michael Hudson

Believe, Writing, Long

Source: www.counterpunch.org
Since 2008 you've had the largest bond market rally in history, as the Federal Reserve flooded the economy with quantitative easing to drive down interest rates. Driving down the interest rates creates a boom in the stock market, and also the real estate market. The resulting capital gains not treated as income.

Michael Hudson

Real, Income, Gains

Source: www.counterpunch.org
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

Trying, Succeed, Economy

Source: www.counterpunch.org
The fact that you have government-guaranteed student loans has created a whole new sector in the American economy that didn't really exist before - private for-profit universities that sell junk degrees that don't help the students. They promise the students, "We'll help you get a better job. We'll arrange a loan so that you don't have to pay a penny for this education." Their pet bank gets them the government-guaranteed loan, and the student may get the junk degree, but doesn't get a job, so they don't pay the loan.

Michael Hudson

Jobs, Government, Pet

Source: www.counterpunch.org
When I say the economy is shrinking, it's the economy of the 99%, the people who have to work for a living and depend on earning money for what they can spend. The 1% makes its money basically by lending out their money to the 99%, on charging interest and speculating. So the stock market's doubled, the bond market's gone way up, and the 1% are earning more money than ever before, but the 99% are not. They're having to pay the 1%.

Michael Hudson

People, Shrinking, Gone

Source: www.counterpunch.org
To save the banks from making losses that would wipe out their net worth, you'll have to get rid of Social Security. It means that you'll essentially have to abolish government and turn it over to the banking system to run, with an idea that the role of governments is to extract income from the economy to pay to the bondholders and the banks.

Michael Hudson

Running, Mean, Loss

Source: www.counterpunch.org

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Born: 1939
Occupation: Professor
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