Tag Archives: Michael Hudson

What Became of the Dollar

09 Wednesday Apr 2025

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MOA offers a look, with analysis, of what passes for economics in the Trumpstein circus act.

Steve Miran is the Chairman of President Trump’s Council of Economic Advisors.

CEA Chairman Steve Miran Hudson Institute Event Remarks – The White House, Apr 7 2025

Today I’d like to discuss the United States’ provision of what economists call “global public goods,” for the entire world. First, the United States provides a security umbrella which has created the greatest era of peace mankind has ever known. Second, the U.S. provides the dollar and Treasury securities, reserve assets which make possible the global trading and financial system which has supported the greatest era of prosperity mankind has ever known.
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Let me clarify that by “reserve currency,” I mean all the international functions of the dollar—private savings and trade included. I’ve often used the example that when private agents in two separate foreign countries trade with each other, it’s typically denominated in dollars because of America’s status as the reserve provider. That trade entails savings housed in dollar securities, often Treasurys. As a result of all this, Americans have been paying for peace and prosperity not just for themselves, but for non-Americans too.
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I’m an economist and not a military strategist, so I’ll dwell more on trade than on defense, but the two are deeply connected. To see how it works, imagine two foreign nations, say China and Brazil, trading with each other. Neither country has a currency that is trusted, liquid, and convertible, which makes trading with each other challenging. However, because they can transact in U.S. dollars backed by U.S. Treasuries, they are able to trade freely with each other and prosper. Such trade can only occur because of U.S. military might ensuring our financial stability and the credibility of our borrowing. Our military and financial dominance cannot be taken for granted; and the Trump Administration is determined to preserve them.

From an economic standpoint the theory Miran describes is bonkers.

Bonkers is about the best Trumpstein and his clowns can offer. But this reinforces what I’ve been saying about GAE primacy post-WW2, based on dollars and bombs. And, of course, the idiot clown’s example is already two years into irrelevancy.

Elsewhere, Michael Hudson explains the underlying monetary problems of the GAE and the fact it is the (fake) private debts, not the gubmint IOUs that have destroyed the dollar. TRANSCRIPT

 

Usury = Control = Collapse

02 Monday Sep 2024

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Another must-read from Dr. Michael Hudson, with video.

My articles about the origins of credit, money and interest share a common frame of reference. From the inception of economic practices and enterprise in the ancient Near East down through classical antiquity and medieval Europe to today wealthy classes have wanted to make themselves into an oligarchy in control of their government and religion to protect, legitimize and increase their wealth, especially their rent-extraction privileges as creditors, monopolists or landlords.

That should be the context in which one looks at every epoch’s economic view of the world, above all its perspective concerning how “free” a market should be, and just whose freedom is being endorsed. That has been the great question throughout the history of civilization, from the Bronze Age Near East when rulers regularly proclaimed Clean Slates to restore economic order to check incipient oligarchies, through the five centuries of civil war in the Roman Republic and Jesus’s fight against the emerging Jewish oligarchy, to today’s civilizational fight between the NATO West dominated by U.S.-oriented rentier oligarchies and the global majority centered now on the BRICS.

We see the same fight through the ages by financial elites opposing any government power able to restrict their self-serving rent-seeking and creditor power at society’s expense. We see it today in the pro-creditor economic policies of the International Monetary Fund, the World Bank and the “libertarian” ideology, all of which seek to centralize power to allocate resources and plan economies in the financial sector instead of democratic government. Today’s neoliberal idea is to get rid of government authority (except where it is controlled by the rentier sectors) and let banks in the privatized financial sector control money and credit, which is the most important public utility.

China’s government has financed its remarkable industrial takeoff without having to borrow from private creditors. There was little money to borrow from its domestic population, so the Bank of China printed its own money. Unlike typical financial practice, it did not demand personal wealth to be pledged as collateral, because stock and bondholdings or substantial real estate did not yet exist. The government did not need to turn to bondholders to increase its public spending – and in any case, there were no domestic bondholders to borrow from in the wake of its Revolution.

China, Russia, and Iran are simply continuing the practices of previous nations that, wanting to exist, limited rent seeking. Any nation that did not impose substantial limits on the financial vampire class soon ceased to exist. That explains why China, Russia, and Iran will be around in 2030, 2050, and 2100, while the GAE and it’s ilk will fade into history. Dr. Ron Paul aside, virtually no GAE leader of the past 50 years has even dared think about doing the things that might have preserved America. The two clown puppets of 2024 are no different.

A Western Detour

24 Saturday Aug 2024

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And not a good one. Here’s the transcript of an interview with Dr. Michael Hudson about the centuries long decline of the West. I highly recommend the whole thing.

Dr. Hudson: Well, Protestantism was created by the financial interests. Here was the problem that bankers had. If they lent money to the Catholic kings, the Catholic kings were so oppressive that they kept going bankrupt. They couldn’t raise the money to pay for the wars, and they kept defaulting. And what the banks wanted was the modern national state. They wanted states that had a parliament that, instead of opposing debts, as they did under the kings, parliaments would be willing to borrow money to wage wars to defend themselves against the Catholics who were attacking them, by pledging all of the revenue of the whole population. And the modern states, as the power to tax and pledge public debts, were essentially created with constitutions to satisfy the banking interests, enough to be able to raise credit. And the modern states, ever since the Protestant Reformation, have become basically agents of the international financial class.

As there is no new column here this week, I thought the foregoing would be a good substitute. If you want to read me on something, then just type your pet subject into the search bar. Odds are that somewhere over the past 12 years I’ve covered it.

Cooperation of the Titan$

26 Sunday Nov 2023

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Michael Hudson and Steve Keen together again in a great interview discussion!

Transcript

3-Hour video:

I’m treating their infrequent but joint mentioning of “climate change” as a thing the way I did with Justine Reix’s lovely book – grain of salt. Otherwise, this is astounding. Many thanks to these men and their hosts.

The Obvious Alternative

10 Tuesday Oct 2023

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Michael Hudson speculated about what the BRICS+ non-currency will look like.

John Maynard Keynes proposed an alternative to holding dollars – something like an anti-Bretton Woods. His aim was to avoid US financial dominance by creating a fiat currency, the bancor. That was not a form of international money, but had a special purpose as an asset of “paper gold,” akin to what the IMF later introduced as Special Drawing Rights (SDRs) in response to the US Government itself needing a bailout as its foreign military spending pushed its balance of payments deeply into deficit during the 1970s war in southeast Asia. Bancors or SDRs could be issued to countries running balance-of-payments deficits to pay payments-surplus countries.

The distinction between a “BRICS currency” and a “BRICS bancor”
This is the problem that the BRICS+ and Global South countries are trying to solve today. The popular press has confused matters by referring to a “BRICS currency.” It is not a currency like the euro or the ruble or renminbi. It is not a currency that anyone could spend at the grocery store or to pay rent. It is not “money” as generally understood. It is not a currency that can be traded on foreign-exchange markets, and certainly cannot be bought by speculators (although they could gamble on what it might exchange for, something like betting on a horse race without having a horse or jockey in the race).

Domestic money, like the dollar or euro, ultimately derives its value from being accepted by national governments in payment of taxes or other transactions with the public sector. That makes such money fungible. Money in that sense can be thought of as a public utility. But providing such currency for a number of countries requires a common government, fiscal authority and legal system. If the currency is to be issued by a number of countries – like the euro – it therefore requires a political union empowered to allocate who gets how much of the currency. No such political foundation yet exists for the BRICS. In President Putin’s words, countries are “at different stages of development.” More to the point, their mutual trade and investment is nowhere near in balance at present. That imbalance is the major problem to be solved, just as it was in 1944-45. It is a balance-of-payments problem, not one of financing domestic government budgets and spending.

Read the whole thing.

History Rhymes Again

02 Sunday Jul 2023

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Michael Hudson wrote a great piece on the similarities between the ancient world and clown world.

Having endowed the region’s cosmopolitan Temple of Delphi with substantial silver and gold, Croesus asked its Oracle whether he would be successful in the conquest that he had planned. The Pythia priestess answered: “If you go to war against Persia, you will destroy a great empire.”

Croesus therefore set out to attack Persia c. 547 BC. Marching eastward, he attacked Persia’s vassal-state Phrygia. Cyrus mounted a Special Military Operation to drive Croesus back, defeating Croesus’s army, capturing him and taking the opportunity to seize Lydia’s gold to introduce his own Persian gold coinage. So Croesus did indeed destroy a great empire, but it was his own.

Fast-forward to today’s drive by the Biden administration to extend American military power against Russia and, behind it, China. The president asked for advice from today’s analogue to antiquity’s Delphi oracle: the CIA and its allied think tanks. Instead of warning against hubris, they encouraged the neocon dream that attacking Russia and China would consolidate U.S. control of the world economy, achieving the End of History.

The fall of most great empires usually results in the formation and development of various homogenous nations. So, as painful as this decade is and will further be, it’s necessary.

Michael Hudson On Matters

17 Saturday Dec 2022

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This is a great interview!

Among many intelligent observations, including the new “iron curtain,” he briefly discussed the plight of Ukraine and Russia.

Ukraine hardly can be rebuilt. First of all, much of its population has left, and is unlikely to return, given the destruction of housing and infrastructure – and husbands.

Second, Ukraine is owned mainly by a narrow group of kleptocrats – who are trying to sell out to Western agricultural investors and other vultures. (I think you know who they are.)

Ukraine is already debt-ridden, and has become a fiefdom of the IMF (meaning in practice, of NATO). Europe will be asked to “contribute,” and the foreign reserves seized from Russia may be spent on hiring U.S. companies to make a financial killing rebuilding a pretense of an economy in Ukraine – leaving the country even more debt ridden.

A new Democratic Party secretary of state will echo Madeline Albright and say that the killing of Ukraine’s economy, children and soldiers “was all worth it” as the cost of spreading democracy U.S.-style.

If Russia actually subjugates all of Ukraine, then there may be a grand opportunity for a new industrialized solution. Russia could tell the Werewestern banksters to go to hell, cancel the fake debts, reclaim all the stolen resources, and rebuild with an eye towards operational society. Such would serve the interests of all concerned people, and not the evil overlords of the dead West, it would serve as a great example of renewed modern civilization, and it would cause the evil-doers unending grief. Many wins. So, even as those held captive in the remains of the West suffer, they should still be grateful that elsewhere, people are rising. Read the whole thing.

 

A Few Happy Items

10 Thursday Nov 2022

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Sovereign World:

In re Kherson, yes, it looks like a loss, retreat, or even loss. But, wars are not won by looks or optics or fuzzy feelings. Ignore the MSM BS. This is either one step backwards before two to ten steps forward, the setting of another trap (of which at least Kiev is leery of), or both. Winter.

Clown World:

Tuesday’s “election” might best be described as a soft steal. Who could have ever seen that coming?!?! But, please do keep babbling about your democracy, your GOP, AIPAC Ron, and the like.

A Great Interview With Michael Hudson:

Read this.

Where’d the Flu Go???

Read this.

Theft, Murder, and Slavery

07 Wednesday Sep 2022

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Michael Hudson explains exactly how the mass financialization of the economy has destroyed the economy and American society. Watch this and LISTEN.

https://www.youtube.com/watch?v=NVGrSp1xRCQ

If you don’t or can’t understand what the man just said, then you are too terminally stupid or wicked to salvage.

Your beloved Ds and Rs will not help you. The only way to turn this around is to ban all fake money and all of the loans that created the fake money, make dealing in fake money and charging any amount of usury capital felonies, and retroactively execute the murderers who created this evil system. Deus vult.