Keynes, at the end of the General Theory, poetically called for the “euthanasia of the rentier". Eliminate the premium associated with the scarcity of capital. This was a view that was not followed by Keynesians of the post-WWII period, yet this may be policy of choice around the Western world. We have gotten negative nominal interest rates in the Eu-zone and negative real rates is part of the normal policy choice. No ventral bankers is interested in what "rentier" think or what the impact will be on their wealth portfolios. there is talk about entrepreneurs, equity holders and homeowners in debt, but the people who clip coupons are just not that important. The policies of financial repression are in place to make sure that rentiers do not avoid their fate. Place capital controls and regulation on the movement of capital and negative rates will strangle the bondholder.
However, if we euthanize rentiers who will finance the future we want.
No comments:
Post a Comment