Debunking Economics - the podcast

Discover the quirky banking world of Coinucopia, where coins ruled until banks began issuing loans. Explore the evolution to electronic banking and how it simplifies life more than you'd think. Dive into the humorous side of banking with tales of currency confusion and the intricacies of fractional reserve practices. With engaging anecdotes and relatable analogies, unravel the mysteries of loan creation and deposits. This journey reveals not only Coinucopia's unique system but also intriguing insights into our real-world banking dynamics.

Rachel Reeves faces scrutiny over her economic strategies as she struggles to balance growth with budget cuts. The conversation dives into the impact of increased business taxes on the UK's stagnating GDP. Modern monetary theory takes center stage, challenging traditional views of borrowing and fiscal responsibility. The podcast also critiques the disconnect between economic theories and real-world outcomes, particularly regarding market behavior and public sentiment. Insightful, engaging, and thought-provoking discussions unfold throughout.

With 8.2 billion people currently living on Earth, projections suggest a daunting rise to 9.7 billion by 2050. However, insights reveal that as nations grow wealthier, fertility rates fall, potentially leading to a natural population decline. The discussion also digs into the disparities in resource distribution, food security, and the impact of declining birth rates on rural areas. Additionally, the challenges of mass migration and the ethical implications of population control measures are thoughtfully examined, highlighting the intricate balance needed for sustainable growth.

Discover the economic trials of Coinucopia, an island grappling with limited gold coins leading to sluggish growth. As new banking policies emerge, including loans and bank notes, the debate on the relationship between money creation and inflation heats up. Challenging Milton Friedman's theories, the hosts explore how innovation impacts consumer demand and production. They delve into the complexities of banking practices, questioning traditional narratives about debt and money creation, and envision the future of banking on the island.

Step into the fictional island of Cornucopia, where gold coins are the only currency and banks are banned from lending. Discover how traditional economic theories struggle in this cash-only realm while bringing to light the challenges of inflation and resource depletion. Delve into the idea that money is more about trust than gold, and learn how investment can spark growth even in constrained environments. Plus, explore personal finance tips to tackle unwanted subscriptions, showing that even in a simplistic economy, complexity abounds.

Elon Musk has been moaning that he pays too much tax. He wants to keep more of the $14 billion or so that he earns each year. But has he got a point? Do we need to the opportunity to become incredibly wealthy to drive innovation. If we had more equal levels of income, would we actually suffer from lower growth, so everyone would end up worse off.? Phi puts the question to Steve Keen on this Christmas edition of the Debunking Economics podcast.  Hosted on Acast. See acast.com/privacy for more information.

When central banks declare a new interest rate, how does that magic into existence? Steve explains how they trade in bonds, to drive yields close to their target rate. If they are buying up bonds held by pension funds and the like, are they also adding to the money supply? Could that have more impact on the health of the economy than playing with interest rates? But the problem is, the money created is circulating in the financial sector. If the central bank really wanted to boost the economy, it should find ways of pushing new money to those less well off. Hosted on Acast. See acast.com/privacy for more information.

There’s a common myth around banks. That banks are the intermediaries who collect deposits from customers, keep a bit in reserve, then lend out the rest at a higher interest rate. That argument then extends to a multiplier effect, where the money loaned out is deposited in banks, freeing up more money for further loans. The multiplier is how textbooks argue that banks create new money for the economy. This week Steve argues that the multiplier doesn’t exist. Not in that way anyway. And banks create money, not by lending out deposits, but by creating new money to lend out, which appears as deposits in the bank’s balance sheet. This week Phil brings the textbook arguments to the table for Steve to shout them down. Hosted on Acast. See acast.com/privacy for more information.

Does government debt expand the supply of money? According to Modern Monetary theory, yes it does. It’s all down to simple double-entry book-keeping and an understanding of the role of financial equity.   As Steve explains, in this step-by-step guide, for the private sector to experience positive equity, the government sector has to have negative equity. In other words, without the government sector spending more than it’s earning, there’s no new money being added to the private sector. As Stephanie Kelton puts it, their red ink is our black ink. This is one episode to share with your friends. Hosted on Acast. See acast.com/privacy for more information.

The discussion centers around Mario Draghi's call for increased investment in Europe to combat economic stagnation. It highlights the need for innovation, particularly in AI and renewable energy, as paths to reclaiming competitiveness. The challenges posed by Europe's parliamentary system and regulatory constraints are examined, alongside the potential advantages of a more unified approach. The conversation also touches on how U.S. spending cuts could create opportunities for Europe, emphasizing the importance of collaboration and strategic investment in technology.