Steve Keen on BBC HARDtalk [good sync]

Sarah Montague talks to Steve Keen, one of the few economists to have predicted the global financial crisis, about the possibility of another Great Depression, and how to avoid it.

'Another Great Depression is all but inevitable' - that's the view of Steve Keen. He's been called the 'Merchant of Gloom', but he's one of the few economists to have predicted the global financial crisis. While he used to be a lone voice in challenging the economic consensus, more and more people are now listening to him. His way of avoiding depression? Write off the debt, bankrupt the banks, nationalise the financial system, and start all over again. He talks to Sarah Montague.

• Category

  News & Politics

[cyborganic99]

Raise your hand if you're a Keensian

[AnniesEggs]

An edition of the BBC Radio 4 programme "Analysis" is being recorded at the LSE on April 2nd. He will be interviewed by a far more competent journalist, Paul Mason. Don't think the programme is going to be broadcast until the summer"listen again" options probably only available in UK but a transcript of the programme is usually available on the BBC website.

[vivek bandebuche]

good to see steve keen here on news. Goodsync is again one of the best backup tool i ever seen

[PrivateAckbar]

Anyone interested in real economic science should read Human Action or Man, Economy, and State.

[Rob Mews]

Speculators are not to blame for the crash but the government. What you describe is what you experienced personally - Speculators acted as everyone does all of the time. they buy what they can sell later for a profit. Their buying keeps prices above what they would otherwise be at that moment but this is only during an upward price trend. likewise their selling depresses prices.Their overall participation evens out prices. The misguidedl interventionists in this normal process was government.

[Rob Mews]

Yes, roadupwards you are right but the banks and private business is always in competition or out of business totally. If the floodgates of finance are opened by the government (by LAW) then it is axiomatic that all business will follow to stay in business even if they don't particularly feel comfortable with it. My memory is quite long as is my interest in the subject matter (over 50 years !!). I can show the model of how it works ALWAYS !! no matter what party was or is in power.

[theroadupward]

The speculators on Wall St pushed those dodgy mortgages. Is your memory so short? "Countrywide is on your side" "Low credit, no credit, no problem" "Flip that House" on TV. BTW the banksters became fabulously wealthy doing so while millions were foreclosed and whole economy crashed.

[Rob Mews]

Why would you reward people who were bad debtors rather than people who did the right thing as opposed to defaulters. A receipe for supporting and promoting defaulters which is what the government's Acorn loans was all about - forcing banks to lend to people who had not learned to save deposits and/ or work out that you need to live within your means. This guy is blaming "the system" when the fault is with people's individual and collective choices..

[Rob Mews]

At least one person has fallen for the financial trick by government. The fallacy is that more regulation is needed since this caused the problem. He is however right that the depression is here, But building a great war machine cannot get a country out of depression unless the machinery built is sold to another economy and even that has qualifications on it with a Laffer type curve influences coming into play. His debt/ credit theory is however incorrect and I can illustrate why.

[LanceVader]

We have at least one. Don't you remember Bob Schieffer in the debates? I do wish we had more interviewers of that caliber, however.

[gwynedd1]

That isn't what his plan does. You seem to have missed his point that people thought they were buying AAA rated bonds and that the speculators fraudulently sold them off already. Another analogy is cutting down the telegraph lines. You will punish everyone without price stability. Lack of price stability destroys the communications of real commerce. All his move does is shift money away from finance back into the real economy. All the other relationships remain.

[MikeKay1978]

No not at all. I don't like to give handouts to people who have misscalculated or placed bad bets. We can't make one systemic error go away by introducing a new one. We should get rid of the first systemic error. The Us could for example live by the rule they preach, yes by capitalism where you raise and fall on your own merits. Not the socialism for the rich type of capitalism.