How Long Will Central Banks Continue Enabling Big-Spending Politicians?

DM

It has been said that history doesn’t repeat itself, but it rhymes, and there is sure a lot of rhyming going on right now. Over human history, we have seen countless successful civilizations fall apart because people forget the connection between productivity and wealth. People forget the work that went into building up a society and an economy, and start to push more and more magical economic theories. Those theories can seem to work in the short term, because they burn through the surplus wealth created by true industriousness, but sooner or later reality reasserts itself. Currently, we are seeing a rising push for a guaranteed basic income, and for modern monetary theory. Both ideas are based in a grain of truth, those being that the current crisis showed the short-term importance of providing financial assistance to individuals who were locked down, and that countries with a sovereign currency can afford to go further into debt than those without it.

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