IL06: The History of Interest & the Next Devastating Crisis ft. Edward Chancellor

Aug 10, 2022

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Edward Chancellor, Author, Journalist and unrivaled Financial Historian, joins us today to discuss the history of Interest, based on his new book, “The Price of Time: The Real Story of Interest". We address why it is crucial to pay attention to the historical perspectives of the economy, the allocation of capital and interest and why low interest rates have a feedback effect on the economy, the zombie corporate phenomenon and the impact it has on the economy. We also discuss the longer term consequences of low interest rates and whether bubbles can be beneficial, globalization and how interest rates impacts the fragility of global supply chains, the role of Central Banks and how they affect price stabilization by preventing creative destruction. Lastly, we discuss how the Fed policy of “cleaning up afterwards” creates unintended problems, how a zero interest policy can pose a threat to capitalism and much more.

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Episode TimeStamps:

00:00 - Intro

02:19 - Introduction to Edward

04:19 - The process of writing his latest book

14:15 - Are we forgetting the economic history?

19:34 - How Edward approaches his study of Interest

25:43 - The impact of interest rates

35:22 - The notion of zombie companies

46:04 - Can bubbles be beneficial?

52:01 - How interest rate affects global supply chains

57:27 - Central banks and price stabilization

01:04:54 - Should Central Banks prevent bubbles?

01:08:39 - Is a zero-interest policy a threat to capitalism?

01:14:14 - Key takeaways from Niels

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