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As I understand, Ben Bernanke implemented what was a suggested way to manage 'Bank Runs' by different research papers (including by Dr Philip Dybvig - one of the processors at my alma matter in US). The implantation seems to have worked, but essentially it was an idea by someone else.

He single-handedly eliminated the concept of "bear market" from stock market investing. Now whenever there is global crisis and stock market tanks, the printing press goes BRRRRRR..



So yeah, it definitely looks like the committee members who decide on Nobel Prize for Economics have most of their wealth in stocks.

Author of a new book says that wall street financial economy is 4 times bigger than the actual economy. Jump to 14:55 directly for that part.

https://youtu.be/XrEI2-7Ubiw

https://www.youtube.com/watch?v=2GQ7dZr4ht0
Summary (taken from the transcript):
• We live in a world of excess savings (and this has nothing to do with QE or the Fed)
• Real risk-free interest rates are negative and shall continue to be so. This too has nothing to do with QE or the Fed.
• The inherent nature of free market capitalism is growing levels of inequality and a reversion to a quasi-feudal society where a handful of wealthy, powerful investors call the shots
• If we are to prevent the above from happening, then the govt needs to spend aggressively to help the masses and roll out universal basic income
• There is nothing wrong with fiscal deficits. High govt spending and fiscal deficits don’t by themselves damage economies
• Monetary policy should be used to aggressively capitalise banks and new lending institutions who should then be encouraged to lend more (say thru Lower capital requirements).

Many of the topics touched upon in the talk is not something I have an understanding of, I listened in since it gave me a peek into these key ideas on macro economics.

The thoughts that stick to my mind are:
a) Is that risk free capital should have -ve return.
b) UBI income should be implemented and it should be with a inverse linkage to the state of the economy (when in a downturn, the UBI payout should be higher, while economy is booming and joblessness is low, keep the UBI payout low).

Bunch of thugs and quaks whose beliefs are can be summed up by the so called "Modern Monetary Theory". These are policies which actually causes runaway inflation and asset price bubbles which benefit the rich. Then these guys attribute the income in-equality to "inherent nature of free market capitalism". Then they will talk about stuff like "universal basic income" to show their "humane" side as some sort of a panacea for everything, whose real motive is to actually keep the hordes quite and fed enough to support the higher ups in the pyramid.

No matter how the money is distributed, some will save and some will spend. The savers will get richer and the spenders will get poorer. The savers get to flaunt and the spenders Envy them. This is the society.

This is where the concept of Digital dollars and Rupees comes to rescue, where the money comes with an expiration date [effective down the line after some years i guess]. Everyone who has it must spend it before its expiry. but this comes with a huge caveat. People will switch to gold and silver, essentially pushing us back.

No system is perfect. Some are just more flawed than others.

Ok so what causes (ever growing) income inequality?
Laziness of the poor people?
Really, are we living in the fairy tale land of kindergarten?

Though my post is not in support of purported thugs and quacks, I wish to clarify a few things.
No idea about the "Modern" Monetary Theory but JM Keynes brought the role of govt's into prominence (in 1930s) and he had very simple principle: demand causes economic growth. Demand is fueled by market sentiments and optimism about future.

In other words: In the times of economic degrowth, govt should do deficit budgeting to fuel the sentiments and inspire confidence in future. In times of economic growth govt should ideally accumulate money since markets are already running in full optimism.

However, if we go by the dictats of laissez-faire: then during economic bust when everything looks bleak then there will come a point in un-employment and price drops that will regain profitability AND confidence in future.
In reality things are not that smooth and bright due to finite lifespan of an individual as well as human labor subject to non-objective yardsticks for evaluation (causing price stickiness). Ultimately it is this "labor" with limited life span and limited savings that creates aggregate demand for the economy.

The cycles of booms and busts might be stoked by excess liquidity provided by govt spending on deficit budget or even QE, and perhaps if you remove this element then the magnitude of boom and bust may reduce.
But fundamental cause of boom and bust is OVERCONFIDENCE and FEAR & DOUBT about future which is inherent nature of human psyche. This pysche follows chaotic distribution rather than gaussian distribution and hence difficult to model and predict.
Coupled with the fact that any venture or enterprise doesn't immediately start producing results, you get a lag in the entire economic system (saving->lending->profits/loss->defaults/savings-> ...) and hence the feedback control cannot work without excess yo-yoing.

You may feel entirely comfortable with uncertain future; but for the vast majority of human beings, including the venerated businessman, people want some element of certainty about future outcomes.

Comparison of INR depreciation versus that of other currencies in the current USD driven meltdown. The RBI, IMHO, should not work hard to prop up the INR just ensure the slide is smooth and not abrupt.

Can any expert post a detailed analysis of what is currently happening in UK and what were the reasons for it?

I am not getting a nicely summarized article on the internet (maybe I am not searching the right places) and some articles are paid subscriptions.

RBI's stated policy is just that - they will intervene only to reduce volatility. RBI intervention happens even when INR goes up rapidly in value against USD. RBI will not look to keep INR in a particular price range.

RBI has zero tolerance for volatile, bumpy moves in rupee: Shaktikanta Das
https://economictimes.indiatimes.com...w/93046168.cms

Here is my take on the situation in the UK.

They had a bunch of mostly old folks whom hunkered for the old British empire feeling. They were also closet racist. They voted a total ninny comb in power and he held a Brexit forum. He never thought it was going to be a problem. But all the oldies broke out their Zimmer frames and hobbled to the voting office and thus Brexit was a fact.

The ninny comb was replaced by a lady, can’t remember her name but she was even more incompetent that her predecessor. So a little Tory mutiny later they put a total idiot in charge with a bad hair cut. He got Brexit done, sort of, but was caught out breaking all sorts of rules. So another Tory mutiny and the Tories appointed person with even less talent and competence. She believed in the trickle down society. Which basically means the well
Off get huge tax breaks and the idea being they spend more and that will be good for everybody else’s. Everybody else being about 99% of the country. And of course, the trickle down economy has never ever worked. It is only promoted by idiots with huge bank accounts.

So this last lady PM set a new record for being the PM with the shortest reign, ever. Only 6 weeks. Personally I think she reigned for only four weeks, because the UK was shut down for two weeks due to the passing of the late queen.

So basically it is all down to the Tories being complete idiots and total ignorant of what is happening in their country.

So essentially, nothing new under the sun

Jeroen
A former UK resident and currently still and always married to a UK national.

Why is Brazil and Mexico doing well in that graph. The only thing they both have in common, is that they are close to the US border. Even Canadian dollar as depreciated against the US dollar.

This is a very succinct and accurate analysis of what's happening. However, it wasn't just the old people that voted Brexit. I did too. :uncontrol

The UK has been on a slide since the 70s when labour unions decided to strike on days that ended with a y. Thatcher's reaction was to destroy industry, and set the ball rolling for them to turn into a services economy. The country currently has less manufacturing than Indonesia. Proper Bri'ish engineering.

Then of course, they decided to exit the European market because they were tired of 'bloody foreigners' coming over and taking their jobs. Funny thing, the majority of the jobs being taken were the ones locals didn't want to do - cleaning houses, waiting tables, handling baggage at airports - or weren't qualified enough to fill - IT, deep tech, management, finance. It didn't occur to them that an economy built on services shouldn't shut itself off from its neighbour, the world's richest continent.

The UK has no real action outside of London, possibly excepting Scotland's oil. The City will continue to thrive as a financial clearinghouse and haven for all kinds of illicit money. The rest of 'little England' will wither away, now accelerated, while they whinge about bloody foreigners and the like, while enjoying their cradle-to-grave social security system. In a few decades, their Gini coefficient will probably rival India's.

Can't help but think how similar the UK's thinking is to Maharashtra. The same issues: foreigners taking our jobs, bloody foreigners, the locals either not interested or incompetent, jobs steadily moving across the borders, rising inequality and social anger, idiot politicians trying to cash on the 'us versus them' feeling, the captial city a financial powerhouse but only on paper with no real manufacturing GDP.

You talk of trickle down this and trickle down that, but not a single word on the out of control government spending and money printing which is one of the predominant cause of inflation, which of course was done in the name of protecting and huddling the middle class and the poor, the salt of the earth, the real people. Its funny people like you rail on about Reagan this and Thatcher that and the greedy 80s, but you always leave out the stagnant 70s, the reason they got elected in the first place. Quite the cherry picking you are doing here.