However, her denigration in this article of the (everybody’s scapegoat) Larry Summer’s suggestion for negative interest reminds me of Charles Eisenstein’s Sacred Economics, where he discusses the positive effects of “demurrage,” money that loses value over time, since it encourages circulation rather than hoarding. What is the difference between demurrage and negative interest? Not obvious, just from a google search.
Excerpts from this Ellen Brown article on Amend the Fed:
“. . . The fatal flaw of QE is that it delivers money to the accounts of the creditors and does nothing for the accounts of the debtors. Bad debts remain unserviced and the debt crisis continues.
“. . . The fatal flaw of QE is that it delivers money to the accounts of the creditors and does nothing for the accounts of the debtors. Bad debts remain unserviced and the debt crisis continues.
“Bernanke delivered the money to the creditors because that was all the Federal Reserve Act allowed. If the Fed is to fulfill its mandate, it clearly needs more tools; and that means amending the Act.
“The Federal Reserve Act was drafted by bankers to create a banker’s bank that would serve their interests. It is their own private club, and its legal structure keeps all non-members out. A century after the Fed’s creation, a sober look at its history leads to the conclusion that it is a privately controlled institution whose corporate owners use it to direct our entire economy for their own ends, without democratic influence or accountability. Substantial changes are needed to transform the Fed, and these will only come with massive public pressure.”
I especially appreciate people’s economist Ellen Brown’s clarity and reformist imagination that shows us how to tweak institutions in ways that can redistribute and de-centralize money. She also has great ideas on how to transform the Military Industrial Complex, and on the establishment of public banks.
