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"For Keynesians, you can create extra spending through money creation.  This leads to increased employment and then to increased income and growth and thus to more profits.  But the reality of the capitalist system is the other way round.  Only if profitability is sufficient, will investment increase and lead to more jobs and then incomes and consumption.  The demand for money will rise accordingly.  Artificial money creation by fiat from the government does not get round this – as the experience of ‘quantitative easing’ has already shown.
Instead, we must look at what is happening with profits and profitability.  And as I have shown in several previous posts, the profitability of business capital in the major economies is near historic post-1945 lows and the limited recovery in profitability since 2009 has come to an end.  Indeed, global corporate profit growth has ground to a halt and is now falling in China, the UK and most important in the US."

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