Special Guest: Steve Keen is an Australian economist and author. He
was formerly an associate professor of economics at University
of Western Sydney. Currently, he is a Fellow at
the Centre
for Policy Development, and Professor and Head of the School of Economics,
History and Politics at Kingston
University in London.
The Art of Getting an Education in Economics
Professor Steve Keen has found that top flight universities are dominated
by very narrow, doctrinaire teaching. This stylized view has resulted in critics
of this view only getting jobs in low ranking university. With pride Steve
Keen puts his latest university in that camp. "If you want a good education
in Economics, you don't go to a good university. The wider range of thought
and diverse analytics is found at the lower ranking university. Kingston University
is one of those classic university!"
Financial Repression
He does not consider himself an Austrian Economist though he sees it has a
number of key tenets that 85% of the economist aren't aware.
He sees Financial Repression as more about the size of the debt burden within
an economy which drives the behavior of central banks. It is about the excess
weight of private debt crushing the economy. Everything else is a result of
this."
The results include the "badly thought out Quantitative Easing response to
a crisis which they caused by effectively ignoring the growth in private sector
debt, but aren't even aware that this is the cause of the crisis." "Very few
banks have any real clue of what they are doing. If you doubt this, all you
have to do is read the minutes of the Federal Reserve. They wouldn't dare make
them up because it makes them look like a bunch of fools who have no idea what
is happening."
Obviously this sort of view does not make Professor Keen popular with the
establishment, seeking prestigious and lucrative government and teaching positions.
QE Is Not Money Printing!
Irving Fishers explanation of where the Great Depression evolved from was
the level and growth of private debt along with too low a rate of inflation.
Prof Keen is of this school in which reducing this debt will only result in
further falling economic growth. Former Fed Chairman and expert on the Great
Depression did not believe this. Professor Keen considers Bernanke's argument
against this a "load of waffle!". "It is completely naive to the role of banks
in the economy!"
Professor lays out why he was able to warn of the coming 2008 Financial Crisis
an why he does not feel the current "revival' can last anymore than 5 years
before the same sort of thing occurs.
Modern Debt Jubilee
This interview is worth listening to simply for Professor Keens concept of
Modern Debt Jubilee and the Syrian history of successfully doing this every
49 years. You may not agree with his view but it an interesting history lesson
of how this worked prior to the advent of central banking.
Many may also agree with his views and the discussion on why the Euro was
always a mistake as will be Draghi's expected upcoming QE announcment. Few
will likely also disagree with Professor Keen that moden central banking do
not properly understand the role of banks, money, debt and capitalism.
Steve's closing advise: "Don't trust the economists!!"
Video: Financial Repression Authority with Steve Keen
Length: 30 Minutes
