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Renée Menéndez's avatar

I would even go so far as to say that the current economic system, which essentially consists of its financial architecture, will never be abolished. Because the monetary system, since it is no longer hampered by that barbaric relic – gold – has become insensitive to crises. This is simply because central banks can create unlimited amounts of paper bills and thus get any crisis under control. The idiots of "modern monetary theory" may have no idea about the functional conditions of a monetary economy, but they do know that the money-creating potential of the Fed (and every other central bank – with the exception of the ECB) is unlimited. You don't have to be a professor to know that.

This paper money system now exists worldwide. The decisive factor is the way in which this system is managed. On the one hand, there is unbridled financialism, as in the USA, where even the (large) manufacturing companies earn more money from financial speculation than from their actual core business. At the other end of the spectrum is China, which pursues a comparatively rigid monetary policy and isn't afraid to show the red card to crazy people. This is because the Chinese leadership (so far) isn't for sale, unlike Western "democracies," which essentially behave more lika a oligarchy. This so called "elite" will never change the system.

Fundamentally, the credit economy is a good thing that can be properly managed. This includes, first and foremost, protecting people from the dangers of borrowing. This affects many areas that could be provided by the state as public services, such as basic healthcare, education, infrastructure, and much more. All of this is possible; you just have to want it and not consider it communist for ideological reasons. What must stop, however, is the obsession with making more money out of money and instead seeing interest as a buffer against asset losses (not for asset growth). In this function, they have a justification – nothing more. But for that, you need governments that make policies for the people. There are few examples of this, but they do exist.

https://reneemenendez.substack.com/p/taking-the-risk-premium-seriously?utm_source=profile&utm_medium=reader2

Here is the central idea, not exact, but in the right direction.

https://swentr.site/russia/620534-spief-2025-russia-takes-on/

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Peter Nielsen's avatar

Fascinating stuff! Thank you for sharing.

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