Posted on 04/20/2012 7:32:18 AM PDT by Kaslin
Noted financial author Richard Duncan says Capitalism is Dead, Credit New King.
The world needs to clue in to changes to its economic system, including the death of capitalism, according to noted financial author Richard Duncan, who warns that attempts to turn back the clock on our credit-driven economies could be cataclysmic
Recognizing that the world operates on a different set of rules from the laissez-faire capitalism of the 19th century is among the key arguments in Duncan’s 2012 book, “The New Depression: The Breakdown of the Paper Money Economy.”
Stuck with ‘Creditism’
Duncan sees the global economy as having undergone a fundamental transformation during the past 43 years. Since changes in 1968 that freed the Federal Reserve from holding physical gold in reserve against dollars in circulation, total global credit has expanded 50 times, or from about $1 trillion to $50 trillion in 2007.
Over that period, credit creation and consumption, or what Duncan calls “creditism,” took hold as the growth dynamic behind the global economy, displacing capitalism, which he says relied upon sound money, hard work and capital accumulation.
Attempts to break the global economy’s reliance on credit creation as a driver and reboot back to earlier ways won’t work, said Duncan, who sees “sound money” policy recommendations as a recipe for disaster.
Duncan believes that true capitalism died in 1914, when nations across Europe abandoned gold-backed currencies, running up huge deficits in preparation for what would come to be known as the Great War.
“I’m recommending making use of this new economic system. Borrow money at the government level at very low interest rates and then invest that money and change our world for the better.” Duncan said.
Building a national solar-energy grid that could tap the arid landscapes of Nevada are among Duncan’s recommendations.
Duncan said he first outlined his thinking on government-led investment in a 2008 book. On speaking tours, he encountered the “greatest push-back” from free-market, libertarian thinkers who are skeptical of government involvement in the economy.
He says many libertarians “are with me along through the argument” on causes of the global crisis, but that they tend to be “very surprised” by his conclusion that part of the solution requires governments to spend more — not less. Monetary Madness
Duncan is yet another author who predicted a financial crisis but whose solutions can only be described as monetary madness.
"Glutted with excess industrial capacity and a banking system laden with massive loans that will never be paid back, China faces difficult decisions much as Japan did" says Duncan.
Indeed!
Then like an economic madman, Duncan wants the US government to undertake massive infrastructure projects just like the ones that bankrupted Japan and China's State-Owned-Enterprises (SOEs).
Obama's Excursions Into Clean Energy
Look at Obama's backing of Green Energy companies Ener1, Solyndra Inc., and Beacon Power, all three now bankrupt as noted in Another Obama-Backed Green Energy Company Goes Bankrupt.
Solar Energy Madness in Europe
In an effort to spur solar energy in France, Germany, Spain and other European countries, bureaucratic dunces decided to pay as much as 10 times market rates for those supplying energy to the power grid.
In response, farmers in France have started building "barns" that serve no other purpose than a place to put solar panels. Supermarkets put solar panels on their roofs and unused sections of parking lots.
It has been a boom to solar panel makers (China), but it is costing the French power company Electricite de France SA more than a billion euros ($1.3 billion) a year to meet government mandated pledges to accept solar energy from those supplying the grid.
At the end of 2010, EDF received 3,000 applications a day to connect panels to the grid. In 2008, the number of applications was 7,100 for the entire year.
The results should have been easy to predict in advance, but you can never explain anything to economic illiterates interfering in the free markets hoping to make things better. They never do.
For more details, please consider EDF’s Solar ‘Time Bomb’ Will Tick On After France Pops Bubble
Is Capitalism Dead?
If capitalism is dead, it is because socialists, fascists, bureaucratic fools, and central-planner advocates like Duncan destroyed it via foolish proposals to improve on it.
The idea that governments can invest wisely in technology, at reasonable costs, and the free market cannot is downright absurd as the US, Japan, China, and Europe have proven in spades. In short, Duncan has lost his mind.
Purely passive income is not really capitalism, as the article suggests. “Investors” who only live to loan money or buy sucurities or futures contribute NOTHING to add value or productivity.
The govt prints money out of thin air, GIVES it to banks etc., and expects the lowly serfs and peons to WORK their asses off for it. Sounds like slavery more than anything else.
Non-value added tax should apply to purely passive, speculative income, IMHO.
What a question, we haven seen a true Free market, capitalist system since the late 1800, early 1900! Our system has been hijacked by the politicos and has been morphed into a socialistic fascist hybrid. If only we have a True Capitalistic system there would be no limit to the heights human exists could reach.
Not for long.
Being strangled by the black muslim commie in the white hut. Next question.
Who is John Galt?
Capitalism is a term applied by it’s enemies. It really never is born, nor does it die. It’s what humans do, to the extent that the sovereigns permit it.
IOW's let Obama, or any other occupant in the White House, run the economy as he sees fit? No thanks!
“Who is John Galt?”
Or where is John Galt?
One major factor that is killing capitalism is “crony capitalism”. The government is in bed with big corporations and the banks. With this cabal picking winners and losers, it is amazing that any entrepreneurs can still take their new idea and succeed.
Foolishly, we thought that capitalism was ours. We thought we owned it, controlled it and could use it as our slave in perpetuity. We're now discovering that the reverse is actually true. Now it has little use for our cities, our communities and our people, all that remains is rust and ruins.
"You have meddled with the primal forces of nature, Mr. Beale, and I won't have it! Is that clear? You think you've merely stopped a business deal. That is not the case! The Arabs have taken billions of dollars out of this country, and now they must put it back! It is ebb and flow, tidal gravity! It is ecological balance!
You are an old man who thinks in terms of nations and peoples. There are no nations. There are no peoples. There are no Russians. There are no Arabs. There are no third worlds. There is no West. There is only one holistic system of systems, one vast and immane, interwoven, interacting, multivariate, multinational dominion of dollars. Petro-dollars, electro-dollars, multi-dollars, reichmarks, rins, rubles, pounds, and shekels. It is the international system of currency which determines the totality of life on this planet. That is the natural order of things today. That is the atomic and subatomic and galactic structure of things today! And YOU have meddled with the primal forces of nature, and YOU... WILL... ATONE!
Am I getting through to you, Mr. Beale? You get up on your little twenty-one inch screen and howl about America and democracy. There is no America. There is no democracy. There is only IBM, and ITT, and AT&T, and DuPont, Dow, Union Carbide, and Exxon. Those are the nations of the world today. What do you think the Russians talk about in their councils of state, Karl Marx? They get out their linear programming charts, statistical decision theories, minimax solutions, and compute the price-cost probabilities of their transactions and investments, just like we do.
We no longer live in a world of nations and ideologies, Mr. Beale. The world is a college of corporations, inexorably determined by the immutable bylaws of business. The world is a business, Mr. Beale. It has been since man crawled out of the slime. And our children will live, Mr. Beale, to see that... perfect world... in which there's no war or famine, oppression or brutality. One vast and ecumenical holding company, for whom all men will work to serve a common profit, in which all men will hold a share of stock. All necessities provided, all anxieties tranquilized, all boredom amused."
Obama is holding a pillow on its face.
Capitalism will be just fine when people start loving freedom more than the chains of oppression. Our government has promised far more than it can ever provide and the remaining producers are fleeing the oppression. When the system collapses so will the power of the socialists. We will know recovery is on the way when being a Public School Teacher defines a criminal offense. Capitalists will survive and will again pledge together their lives and fortunes to build a free nation. We may not live to see it, but it is in the very nature of man.
Capitalism is simply reality. It doesn’t live or die. Its the real world and its human nature.
A people either let it flow naturally, or a people try to divert it, block, or change it for whatever reasons, with all kinds of unintended consequences.
You either live in accord with the real world, or you don’t - and you suffer the consequences.
That’s well put. Capitalism IS in the nature of man, and it endures and flourishes even in the face of socialism and oppression. It will just flourish a hell of a lot more when the socialist and oppressors are kicked to the curb!
A belief in “variability” is not often cited as a tenet of Conservatism, but it is. Whether it’s meat or money, some have always had more, some less, and it is man’s inherent nature to acquire greater wealth and the things it can provide. Attempts to spread the wealth around fly in the face of who and what we are, and our competitive spirit will win out in the end.
We've done pretty good since 1914. Entrepreneurship has taken off. Capital markets have developed. Buying and selling of business has reached new levels.
I don't see capitalism as dead at all. I see some government corruption and overreaching.
You cannot kill capitalism... it exists everywhere... even in the most communist forms of government.
Just like you cannot remove from a person his/her desire for freedom, you cannot remove from a person the desire to accumulate wealth and trade that wealth for goods and services.
To say that capitalism is dead or non-existent is like saying freedom is dead or non-existent. And yet, even in places like China or Cuba, you will always find it. It may take different forms, and it may be that only the highest social classes will have the most freedom to exercise it openly, but it will still be there. Even for the poor and the oppressed, capitalism is impossible to eliminate. We call it the black market.
It is not that capitalism is dead... or dying.
It is that tyranny is rampant.
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