At 15:16 17/08/2012, Arthur wrote:
One more thing. Agree that Western economies will be slowing
down. Some call it a long term depression. Others call it an
evolution to a stable state economy. We should be thinking about
how to make the transition to a stable state economy. Will be
difficult and involve cultural shifts but the alternative, a long
term depression, seems more problematic.
(KH) I don't think we can plan our way to a non-growth economy. I
rather think it's being imposed upon us. We're so used to the idea of
economic growth -- both conceptually for 300 years and in practice
for most of our lifetimes -- that we think it's the norm. But what's
actually the norm for most of 7,000 years or so of our civilized
history are centuries-long periods of little change. Perhaps we're at
the start of a new one.
Keith
From: [email protected]
[mailto:[email protected]] On Behalf Of Keith Hudson
Sent: Thursday, August 16, 2012 8:10 PM
To: RE-DESIGNING WORK, INCOME DISTRIBUTION, EDUCATION
Subject: [Futurework] Arthur's 4th belief
At 21:17 15/08/2012, Arthur wrote:
4. That effective demand has to be maintained if we are to avoid an
economic meltdown.
Effective demand can't be maintained if there are no uniquely new
consumer goods in sight -- as obtained all through the industrial
revolution until about the 1980/90s. Since then we have had nothing
really new, only amalgamations of existing products (e.g.
smartphones), fashion changes and marginal improvements. It was only
then that a whole new tranche of credit money (derivatives) had to
be launched in order to keep the economic machine going. Until the
1980/90s, derivatives were straightforward insurance schemes whose
notional cover matched that of world GDP on a 1:1 basis. Since then,
complex derivatives rose to 10 times world GDP, such was the
desperate need of the investment banks for consumers (and
governments) to keep on spending.
So what is the future. It can only be a great simmering down of
Western economies into long-term depression or, if the US Fed and
the ECB persist in money-printing, hyperinflation.
Keith
Keith Hudson, Saltford, England
<http://allisstatus.wordpress.com/>http://allisstatus.wordpress.com
Keith Hudson, Saltford, England http://allisstatus.wordpress.com
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