The Slow Crash

An Interview with Michael Hudson, Guns and Butter, April 5, 2016

Most people think of the economy as producing goods and services and paying labor to buy what it produces. But a growing part of the economy in every country has been the Finance, Insurance and Real Estate (FIRE) sector, which comprises the rent and interest paid to the economy’s balance sheet of assets by debtors and rent payers. More and more money is being extracted from the production and consumption economy to pay the FIRE sector. That’s what causes debt deflation and shrinks markets. If you pay the banks, you have less to spend on goods and services.

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