Jump to content
House Price Crash Forum
Bloo Loo

J Vine Discusses Corbynomics With The Advisor

Recommended Posts

Just listened to who appeared to be Joseph Stalin himself describing his ideas for Corbynomics.

1. A peoples bank funded by direct money printing. It wont lend money but spend it on projects deemed in the national interest. Command economy ahoy!

2. Projects they will print and spend on...1st. double glazing for all Government and LA buildings

2nd millions more homes for rent. 3rd..anything else the Governor of the peoples bank suggests.

3. forget the National debt, we own the Central bank, it therefore costs us nothing in reality to borrow whatever we like.

4. This is QE for the masses. via the Peoples bank of course...which he never mentioned about how it moves from the PB to the P....loans I guess.

plenty more command economics in the discussion.

R2 Jeremy Vine, today

Share this post


Link to post
Share on other sites

BBC Scare mongering at its best

Hedge fund co-founder backs Corbynomics (FT.com link via Google)

https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0CCEQqQIwAGoVChMI1s7XsaiNyAIVCG0-Ch0EJApe&url=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F7d973ca0-6139-11e5-a28b-50226830d644.html&usg=AFQjCNHp-RUNrKvxion7j55VR74bUD4j_w&sig2=ds30IgbV5XXDD7t696vjHA&bvm=bv.103388427,d.ZGU

Little suggestion so far that Corbyn is going back to old socialism, but adopting so called 'smart socialism' giving the rentier crapitalists that extract wealth, not create it, the boot (we hope).

Edited by RentierParadisio

Share this post


Link to post
Share on other sites

I seen Corbyn on the news have a proper rant in an interview about BTL. He said borrowing money and renting houses is not the way to build an economy and that building lots of houses was the answer. maybe someone has the clip?

Share this post


Link to post
Share on other sites

I listened to this and it has totally soured me to any form of 'People's QE'. I was willing to be persuaded but I couldn't disagree more with Richard Murphy if I tried.

His only criticism of previous rounds of QE (and indeed the banks' money creation powers) appeared to be that it had produced insufficient inflation. 'People's QE' was presented as just another tool along the lines of emergency interest rates.

Never mind wages or savings or living standards or any form of real wealth. All that matters is avoiding 'recession' by ensuring the numbers tick upwards even as people end up in the slum and the gutter.

I hope Corbyn tells this guy to take a hike. He'd turn the UK into Zimbabwe.

Possibly this is what the BBC want me to think.

Edited by irrationalactor

Share this post


Link to post
Share on other sites

The theory can be made to sound nice

But, unfortunately, it relies on the people making the decisions being competent, motivated and incentivised appropriately

Given that the people making the decisions are likely to be the existing government agencies, departments, local councils etc., the plan is fundamentally flawed in a manner from which it simply can't recover

Share this post


Link to post
Share on other sites

The theory can be made to sound nice

But, unfortunately, it relies on the people making the decisions being competent, motivated and incentivised appropriately

Given that the people making the decisions are likely to be the existing government agencies, departments, local councils etc., the plan is fundamentally flawed in a manner from which it simply can't recover

I agree. We should just leave it to the market, where most of the lending goes to pump up (mainly) the existing housing stock, speculation, carry trades etc

Edited by RentierParadisio

Share this post


Link to post
Share on other sites

I agree. We should just leave it to the market, where most of the lending goes to pump up (mainly) the existing housing stock, speculation, carry trades etc

That isn't the market, that is QE as practiced by central banks these days. Don't confuse that with the market.

Share this post


Link to post
Share on other sites

reading the replies, just reminded what was said that nearly caused me to crash the car.

we NEED inflation...its what supplies pay rises. 0% inflation means we are almost in deflation...and that is bad for GDP.

The man, upset by bankers actions up to 2008, demands the thing that supplies them with guaranteed profits at the cost of savers...inflation.

Share this post


Link to post
Share on other sites

The whole globalisation model seems to be flawed. Investment "experts" go on about the benefits of portfolio diversity and if some parts are falling then other parts will be rising. With the central banks at the reins each following current perceived economic knowledge they're all falling but some worse than others.

They've taken the free market out of the portfolio and they don''t know what to do next - except QE/print money. They get in touch with their pals and tell them what to do - for example you support that and you support the other and if some don't the others get upset and try to force them. Then they come up with research to say that QE/NIRP doesn't work but they still do it.

Their next step is to turn their failed short turn gambles into long term gambles - eventually it'll all turn out ok, so they say.

Edited by billybong

Share this post


Link to post
Share on other sites

All this angst about the return of a 'command economy' in which the free market is dominated by the decisions of a handful of state apparatchiks who attempt to manipulate the system according to their own ends is comical.

Why? because this is exactly where we are already- a handful of state apparatchiks in the worlds central banks are attempting to manipulate the markets- after all what are ZIRP and QE if not a top down effort to control the markets?

It seems to me that what really scares the capitalists is not idea of a handful of men manipulating the system- but the idea that it might be the wrong handful of men- from their point of view.

So while they are happy for a Bernanke or a Mervyn King to engage in blatant manipulation of the 'free' market they would be far less happy for a Corbyn to do the same- because unlike the latter Corbyn cannot be trusted to deliver to them the endless opportunities to loot the system that they currently enjoy.

Share this post


Link to post
Share on other sites

I think the difference between your acceptable command economy and the current one is that they tend to actually do the wrong stuff...people should decide what they want.

CBs decide on the amount of lending with printed money

Corbynomics decide what gets built with printed money.

command economies never work for any length of time...people take advantage, jobsworths get promoted and its impossible to get things changed...you cant argue with a "correct" order from above if the order is the word of the man with the gun.

Share this post


Link to post
Share on other sites

AFAICT there isn't actually that much difference between what Corbyn wants to do and what we're already doing.

Corbyn just wants more.

So, right now the BoE prints money and buys government bonds from "the market". The government sells government bonds and takes money from the markets. In effect, the BoE prints money and gives it to the government.. who spend it on infrastructure projects, but mainly just on making up the budget deficit each month to pay for normal government spending/out going's.

Jeremy just wants to do away with "the market". Which just means it will be much more obvious that we are printing money to support government spending. I vaguely remember this is illegal under international treaties which is why QE was done the other way in the first place.

Jeremy argues that we might as well print enough to cover normal government spending, plus a bit extra to pay for some nice populist vanity projects. It sounds a lot like Argentina circa 1989.

It will be workable while interest rates and inflation are low, but once interest rates and inflation pick up globally we would be at pretty serious risk of a currency crisis I would imagine.

Share this post


Link to post
Share on other sites

The whole globalisation model seems to be flawed. Investment "experts" go on about the benefits of portfolio diversity and if some parts are falling then other parts will be rising. With the central banks at the reins each following current perceived economic knowledge they're all falling but some worse than others.

They've taken the free market out of the portfolio and they don''t know what to do next - except QE/print money. They get in touch with their pals and tell them what to do - for example you support that and you support the other and if some don't the others get upset and try to force them. Then they come up with research to say that QE/NIRP doesn't work but they still do it.

Their next step is to turn their failed short turn gambles into long term gambles - eventually it'll all turn out ok, so they say.

The 'whole globalisation thing' is merely the neoclassical model of blindly selfish, utility maximisers orchestrated with unimprovable efficiency by an Invisible Hand, but with nations taking the place of individuals.

Except there is no Invisible Hand - no set of springs continually restoring market prices to fair value - and nations are no more able to compute their utility functions than individual market actors.

Share this post


Link to post
Share on other sites

I think a greater reliance on markets would probably be better, but I'm not sure Corbynomics would be so disastrous. Has there been any indication of how much spending he wants? Presumably he still wants a significant private sector and private property would be retained, so I think it's a bit misleading to speak of a command economy. We would not run into the problems of true command economies just as a result of nationalising some industries. We already several "command industries" and they have many good and bad characteristics, but I don't think any can be considered disasters.

Share this post


Link to post
Share on other sites

So more inflation then.

The only way i'd favour 'QE for the people' is if it was distributed via a citizen's income, not wasted on Labours pet projects to enrich donors or buy muslim votes.

Spending should come out of taxation. At least taxation can be targeted to fall on the rich. Inflation always harms the poor and middle classes most. The inequality and wealth gap did actually narrow a little between 2008-9, until they started printing again.

Share this post


Link to post
Share on other sites

I think a greater reliance on markets would probably be better, but I'm not sure Corbynomics would be so disastrous. Has there been any indication of how much spending he wants? Presumably he still wants a significant private sector and private property would be retained, so I think it's a bit misleading to speak of a command economy. We would not run into the problems of true command economies just as a result of nationalising some industries. We already several "command industries" and they have many good and bad characteristics, but I don't think any can be considered disasters.

At the end of the day, he can spend whatever he wants on housing, hospitals and schools. Unless he brings immigration down (which he wont) it matters not one jot.

Until he faces that reality, its a non-starter for me. Open borders and welfare states don't balance.

PS. sorry to go on about the immigration issue, but in terms of quality of life, it seems so fundamental It can't be ignored.

Edited by Executive Sadman

Share this post


Link to post
Share on other sites
Open borders and welfare states don't balance.

That's true- and the same can be said of 'austerity'. You can't argue that there is not enough to go around for the people already here while having an open border policy to anyone who makes it into the EU area.

Share this post


Link to post
Share on other sites

If inflation was good for the 1% it would have happened by now.

It has, in the prices of assets owned by the 1%, that conveniently dont count towards in the official inflation figures.

Share this post


Link to post
Share on other sites

I think a greater reliance on markets would probably be better, but I'm not sure Corbynomics would be so disastrous. Has there been any indication of how much spending he wants? Presumably he still wants a significant private sector and private property would be retained, so I think it's a bit misleading to speak of a command economy. We would not run into the problems of true command economies just as a result of nationalising some industries. We already several "command industries" and they have many good and bad characteristics, but I don't think any can be considered disasters.

Murphy has been pretty clear about the limits of PQE and how it would only be used when there was spare capacity that can't otherwise be accessed, i.e. the private sector not investing. I can't really see the issue with a lot of Corbyn stuff, nationalise natural monopolies, pay for necessary infrastructure projects through PQE rather than PFI, some backing (though not yet defined) for LVT and citizens income. Plus a bit of MMT, admittedly with some placatory stuff to avoid the deficit denier tag, not sure I agree with that tactic but it going that way doesn't make him a berk.

He's anti rentier and pro building houses, what's not to like?

Share this post


Link to post
Share on other sites

He's anti rentier and pro building houses, what's not to like?

Well why have people at all, I mean if he creates all the demand, all the money and then spends it all. Why bother with having any people?

Ahh the great utopia we always hear about, but never see....

Share this post


Link to post
Share on other sites

Murphy has been pretty clear about the limits of PQE and how it would only be used when there was spare capacity that can't otherwise be accessed, i.e. the private sector not investing. I can't really see the issue with a lot of Corbyn stuff, nationalise natural monopolies, pay for necessary infrastructure projects through PQE rather than PFI, some backing (though not yet defined) for LVT and citizens income. Plus a bit of MMT, admittedly with some placatory stuff to avoid the deficit denier tag, not sure I agree with that tactic but it going that way doesn't make him a berk.

He's anti rentier and pro building houses, what's not to like?

Nationalise natural monopolies - great. Get rid of PFI - great.

But printing money in any form now gets a big fat no from me. We've already tried it and it was a disaster. It did exactly the opposite of what Corbyn claims to want. Inequality massively increased and homes were bid up out of reach of ordinary people. Everything Murphy said was the same rubbish that's been spouted since the banking crisis - seemingly the only lesson drawn from the previous round of QE was that it was probably less effective in its goal of increasing general inflation than 'people's QE' would be.

It seems obvious to me that inflation is the ultimate enemy of working people. By devaluing their savings and forcing them to work ever harder just to stand still it ensures they can never amass enough real wealth to challenge the position of those who start off holding the assets.

These economists have a fantasy that we can reprise the 70s and inflate away everyone's problems. But it won't work now that the link between living costs and wages has been so thoroughly undermined. There are no unions to argue for wage rises. Globalisation ensures there are always cheaper workers (or that jobs can be off shored). Tax credits mean that any pittance of a wage will keep a worker from starving.

And even if by some miracle we do get wage inflation, 'emergency' interest rates ensure that savings will be eroded just as quickly as the debt. Years of people's working lives made meaningless - we may as well not have bothered, if the outcome is always to end up effectively with nothing.

I don't see why the government can't encourage growth by taxing wealth and disincentivising malinvestment and hoarding. As for infrastructure investment - that's what normal government borrowing is supposed to be for.

The thing is, I was willing to be persuaded. But it seems 'people's QE' is just another Gordon Brown-esque bailout for the bankrupt and the indebted.

Share this post


Link to post
Share on other sites

It seems obvious to me that inflation is the ultimate enemy of working people. By devaluing their savings and forcing them to work ever harder just to stand still it ensures they can never amass enough real wealth to challenge the position of those who start off holding the assets.

Inflation is form of taxation. Right now this "tax" goes to private institutions such as the banks, sure Id rather not have it all, but if were going to have it I'd rather it go to the government and if they are going to spend it to build new houses even better.

Edited by goldbug9999

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   48 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.