YouTube has the video 4 US banks crash in 2 months: Banking crisis explained by economist Michael Hudson.

Economist Michael Hudson joins Ben Norton to discuss the collapse of four US banks in two months, giant JP Morgan Chase taking over First Republic Bank, and how government regulators are in bed with the bankers.

How hard does the public have to be slapped in the face by reality before more people see what is going on? Unfortunately, if more people wake up, my investments in short term government bonds may crash. Maybe my investments in gold will rescue me. If we have a nuclear war, none of this will make any difference. I am almost 79, so I won’t have long to suffer no matter what.

Here is an article from Wall Street On Parade that Hudson and Norton mention Americans Are Wrong to Worry About FDIC-Insured Bank Deposits; They Need to Worry About Sales Hustlers Inside those Banks and Short-Selling Barbarians

The Analysis News has the post Debt and the Collapse of Antiquity – Michael Hudson.

We get a first look at the new book by renowned political economist Michael Hudson on the age-old battle between creditors and the real economy. Ancient Rome refused to adopt the practices of debt forgiveness and land redistribution previously understood to be essential. Instead, they instituted a rigid pro-creditor legal system, assassinating anyone who remotely threatened it–including Tiberius Gracchus, Julius Caesar, and Jesus. The empire devolved into a rentier economy, ultimately collapsing from within. Today’s neoliberal establishment increasingly defends this failed state framework, even as the same disastrous dynamics intensify.

I was getting tired of hearing interview after interview with Michael Hudson about his new book “The Collapse of Antiquity”, but I was pleasantly surprised by this interview. The interview which is only the first half of two, gets further into the book than I am in reading it. Michael Hudson gets to make a lot of points that I have not got to yet. The few comments on the interview do not seem to have gotten the message right. The comments extol some of the points that Hudson decries.

Here is an excerpt from Michael Hudson’s book that I just read last night.

This does not sound like an endorsement of Socrates’ brand of logic.

28 April, 2023 addition of Part 2. The may be the most startling part if you have been raised in a Western culture.”

In part two, Michael Hudson discusses his new book “The Collapse of Antiquity.” Hudson challenges the traditional beliefs about the fall of the Roman Empire, arguing that it was caused by a financial crisis brought on by excessive debt, wealth inequality, and the concentration of economic power. Hudson draws parallels to modern-day economies and highlights the dangers of financialization and wealth concentration.

Naked Capitalism has the article Michael Hudson Talks to Ben Norton About SVB and Bank Failures.

The introduction by Yves Smith is well worth the read. Here is a small excerpt.

Yves here. Michael Hudson gives yet another meaty take on the recent spate of bank implosions in the US, with the spectacle of sick man Credit Suisse taking a big heave adding to rattled nerves. We’ll take the liberty of providing some additions and qualifications.

Here is the description of the video below.

Economist Michael Hudson analyzes the collapse of Silicon Valley Bank, Silvergate, and Signature Bank, explaining the similarities to the 2008 financial crash. He also addresses the US government bailout (which it isn’t calling a bailout), the role of the Federal Reserve and Treasury, the factor of cryptocurrency, and the danger of derivatives.

The introduction by Yves Smith is worth the read, and the video with Ben Norton and Michael Hudson is worth the price of admission (Of course the money price of admission is zero. You just have to spend the time to listen.)

If you don’t want to be financially swept away in the current crisis, you couldn’t make a better investment than watching this. If you don’t want to understand this, I will forgive you when you no longer can afford your “free” access to the internet.

I am just starting to read an article recommended by Michael Hudson. He seems to have a more favorable view of the author, Ellen Brown, than I do. The article is Ellen Brown: The Looming Quadrillion Dollar Derivatives Tsunami.

Unlike in 2008-09, when the big derivative concerns were mortgage-backed securities and credit default swaps, today the largest and riskiest category is interest rate products.

The original purpose of derivatives was to help farmers and other producers manage the risks of dramatic changes in the markets for raw materials. But in recent times they have exploded into powerful vehicles for leveraged speculation (borrowing to gamble). In their basic form, derivatives are just bets – a giant casino in which players hedge against a variety of changes in market conditions (interest rates, exchange rates, defaults, etc.). They are sold as insurance against risk, which is passed off to the counterparty to the bet. But the risk is still there, and if the counterparty can’t pay, both parties lose. In “systemically important” situations, the government winds up footing the bill.

Here is the bone I have to pick with MMT proponents.

While it is true that banks create the money they lend simply by writing loans into the accounts of their borrowers, they still need liquidity to clear withdrawals;

My contention is that these are deceptive words to use in conjunction with what private banks do. I contend it would be more honest to say that “banks create promises of money they lend by writing loans into the accounts of their borrower.” The description of the repo market explains one of the ways that banks make good on their promises when they have to fulfill those promises.

YouTube has the video The rise of US dollar imperialism, and why it failed – with Radhika Desai & Michael Hudson.

Economists Radhika Desai and Michael Hudson explain the rise of the US dollar system, its central role in imperialism, and why it ultimately failed to accomplish Washington’s hegemonic goals.

This is a clear explanation of so much of what most of the neocons and neolibs do not want to know. Even if they do know this, they certainly don’t want you to know this. Even though the 99% of us need to understand this, we would prefer to pretend this isn’t true. We will fight the war against this truth to the last working class person.

YouTube has the video Understanding money and the dollar system’s contradictions with Radhika Desai & Michael Hudson.

Economists Radhika Desai and Michael Hudson explain the relations between money and debt, their role in imperialism, and the rise of the US dollar system.

This is the third episode of their Geopolitical Economy Hour” series.

Very educational talk. They introduced some ideas I had not considered despite years of reading Michael Hudson’s books. I certainly have some questions about some of the things they said. Questions to stimulate further research, not questions to challenge what they said.

I took some quick notes to use for that further research.

№116 Beyond the Dollar Creditocracy: A Geopolitical Economy .

“We are Witnessing the birth of a new monetary order” – March 2022 article by a Credit Suisse expert. Zoltan Pozsar. “Great Power Conflict puts the dollar’s exorbitant privilege under threat” in Financial Times

Nouriel Rubini – “A bipolar currency regime will replace the dollar’s exorbitant privilege” – Financial Times

Kindelberger promoted dollar hegemony. I think I may have taken a course from Kindelberger when I was in college. The World in Depression, 1929–1939.
MIT Professor Kindleberger dies at 92

“Indian Currency and Finance” John Maynard Keynes

Marcello de Cecco “Money and Empire“

YouTube has the video THE ECONOMICS OF THE UKRAINE PROXY WAR w/ MICHAEL HUDSON AND RADHIKA DESAI!

Economists Michael Hudson and Radhika Desai join to break down the economics of the Ukraine proxy war between NATO and Russia as the one-year anniversary of the military operation approaches.

So far I have listened to the first 90 minutes which takes one to the end of the interviews with Radhika Desai and Michael Hudson. It certainly helps to have a background in the Geopolitics that Hudson, Desai, and Haiphong espouse. Of course you can develop that background by watching discussions like this. What I have come to realize is the weakness of MMT (Modern Money Theory) as practiced by almost all the rest of the MMT community (but Hudson and Desai) is the focus on sovereign currency issues. This focus tends to make MMT theorists downplay the importance of the international aspects of geopolitics. That makes MMT good as far as it goes, but it just does not go far enough.

YouTube has the video What causes inflation? Economists Radhika Desai & Michael Hudson explain.

In this episode of Geopolitical Economy Hour, economists Radhika Desai and Michael Hudson discuss inflation: what it is, what causes it, and what are the problems in how the Federal Reserve and other central banks respond to it.

They start off with the point I have been making for years. The rise in asset prices like the stock market prices is a form of inflation that everybody likes. There is no complaint when stock prices rise.

In the comments I inserted this.

Let me see how people here take to my explanation. Private banks do not create money. They create promises of money. The promise is that if you ever need “real” money from the private bank, they will find enough “real” money to satisfy your needs in the form of Federal Reserve Bank money. One example shows what I mean. When you go to a bank’s ATM to withdraw money, you get Federal Reserve Notes. You don’t get anything that represents private bank money.

Another question to ask, is “If private banks create money, why don’t they just create more of it when there is a run on a bank?”

What is it that the Federal Reserve Bank creates that satisfies the demand that private bank money cannot satisfy?

Where is the debt that came from the trillions of dollars the fed created to stop the crash of 2008/2009? The only debt was the USA government’s promise that you could pay your taxes with Federal Reserve Bank money. Why did China need so much Federal Reserve money when they were not subject to USA taxation?

You can find the transcript on the Geopolitical Economy web site article What Causes Inflation?.

Naked Capitalism has published the transcript of the interview Michael Hudson Discusses the Future of Europe and Global Restructuring.

Michael Hudson was interviewed Thursday on MEGA, a German news radio program, focusing on the economic impact of the war with Russia on major players, particularly Europe. We have a translated transcript below and will embed the YouTube version (in German) which is expected to be posted early next week.

Here is some of Question 10 and its answer.

10. … What is your take on digital currencies?

MH: It’s not my department. All banking is electronic, so what does “digital” mean? To libertarians, it means no government oversight, but in government hands, the government will have a record of everything that anyone spends.

If you understand data mining, the government already has a record of what everyone spends in crypto currencies. The ledger of these purchases is open to all to view. People think it is anonymous, but data mining takes out the anonymity.

Here is another good zinger that came earlier,

(8.) Currently we saw the collapse and bankruptcy of the crypto exchange FXT. The management of this company seems to be highly criminal. How do you judge that?

MH: Crime is what made crypto a growth sector for the past few years. Investors bought crypto because it is a vehicle for the fortunes being made in international drug dealing, the arms trade, other crime and tax evasion. These are the great post-industrial growth sectors in Western economies. 

Ponzi schemes often are good investment vehicles in their take-off stage – the pump-and-dump stage. It was inevitable that criminals would not only use crypto to transfer funds, but actually set up their own currencies “free of oppressive government regulation.” Criminals are the ultimate Chicago School free market libertarians.

Michael Hudsin has published a transcript of an interview in War and Debt to Rule.

Every successful economy in history has been a mixed public/private economy. Infrastructure should be public in character. Its aim should not be to make a profit (or economic rent), but to provide basic needs freely as human rights, or at least on a subsidized basis in order to lower the economy’s cost of living and doing business.

Each publication from Michael Hudson adds clarity and detail to what he has been trying to explain to us for decades. This article is no exception.

Naked Capitalism has published a transcript The Destiny of Civilization: An Interview with Michael Hudson on Economic Development, Rentierism, Debt, China.

There is an audio that only goes to about 1 hour and 17 minutes. The transcript goes way beyond that. Here are numerous excerpts worth noting.

The idea of the Biden Administration — really of both the Republican and Democratic Parties — is that since America has moved its industry and manufacturing to Asia in order to lower the wages here, how can Americans continue to get high-living standards, if it doesn’t produce raw materials or manufacturers? How can it be a post-industrial society, getting rich on economic rents and interest on and profits paid by foreign countries? How can America get rich by being a parasite? That was a problem that the Roman Empire had, and we know what happened to the Roman Empire. It was a problem that the British Empire had, and we know what happened to that: it can’t be done. This attempt to make America into a post-industrial society means a rent-seeking, neo-feudal society, treating the rest of the world as a colony under globalization. How can that work? Well, It’s not working. Biden’s war, the NATO war, against Russia in the Ukraine is the catalyst dividing the world into two. That’s why Secretary of State Anthony Blinken said that the Ukraine war is part of a process that will go on for at least two decades, because it takes time for the world to split away into a neo-feudal West and a productive, basically socialistic Asia, or industrial capitalist and socialist Asia, and Eurasia, along with much of the global South.

Another:

You can’t say, I’m a libertarian, I’m against strong government, and then hope that the landlords are going to end up being taxed. That’s an oxymoron.

Another:

You need a state to act as the agent of social planning, so that it’s not the banks and the rentier sector that does it, as occurred in the U.S. and Western Europe. China is doing what most of the world was doing before Western civilization took off and in an oligarchic form.

Another:

The U.S. now is in a state of political paralysis locking itself into the current status quo, which means that the U.S. cannot have any kind of an industrial recovery, because that requires a federal policy to check the overhead of the banking system, the real estate sector, and the insurance sector. You can’t have a Supreme Court that would prevent any kind of a public health system, a single-payer public health system, and yet 18% of America’s GDP is for medical care. America has priced its labor and its industry out of world markets by having to pay so much debt service, so much insurance for medical care, home insurance, and real estate rents. As long as this revenue is paid out in the form of rent, you’re not going to develop.

Another:

There’s no group in America, no political party, that is offering an alternative to the current political and economic system in America. The fact that you have two parties in America that are really the same party, means that there’s no room for a new party to come and, as it would in Europe, get represented in Congress. In Europe, you can have any number of parties, and they would be represented in Parliament in proportion to their votes. A third party would be kept off the ballots in the U.S., and that’s why Bernie Sanders and others decided not to run as a third party; there’s no way we can meet the court challenges by the Republicans and the Democrats together. Sanders had to pretend to run as a Democrat. But we’ve seen that the Democrats don’t want any part of anything progressive. There’s an illusion that somehow the Democrats can be progressive because they have people who can’t find any alternative, who are running as a Democrat. Whereas in Europe, they are running as nationalists, as third parties, e.g., Alternative für Deutschland.

Closing quote:

There cannot be any progress in America today led by the Democratic Party, which is today the ideologically Right-wing party that has turned what should be an economic problem into an ethnic and non-economic problem. It’s like the old industrial capitalist was supposed to have said, “if I can get half the working class fighting against the rest of the working class, then we have won.” That’s the Democratic Party. They asked, “how do we do it?” We divide the working class into ethnicities, ethnic identity, gender identity.