May was always the most likely candidate to become PM. She backed Cameron on Remain but at the same time denounced the European Convention on Human Rights and then remained silent, making herself acceptable to both wings of her party. She is seen as a “safe pair of hands” and a tough negotiator, and after the referendum debacle competence is at a premium. Article 50, the legal mechanism for leaving the EU, has not yet been invoked, although both Jean-Claude Junker and Martin Schulze, presidents respectively of the EU Commission and Parliament, want an early start on negotiations to reduce uncertainty. May wants to wait but this should not be seen as seeking a way to wriggle out of leaving. She has stated that “Brexit means Brexit” and backed this by appointing Leave campaigners to prominent positions, but she requires time to prepare. Apart from the Bank of England, none of the institutions or departments of state has planned for this eventuality, and the civil service needs to rebuild its capability for trade negotiations. Article 50 allows some flexibility over the timing of withdrawal but May will want it done before the next election in May 2020, having ruled one going to the polls before then. There were some illusions on the UK left about a Tory collapse after a Leave vote but it’s now clear that will not happen.

What does all this mean for the UK economy? Economists were nearly unanimous in predicting negative consequences from Brexit, through an immediate market shock, reluctance to invest or recruit during uncertain withdrawal negotiations, and longer-term negative impacts on exports and foreign investment, depending on the outcome of those negotiations. There is no reason to revise those forecasts, although it should be noted that micro effects will vary and none of the predictions delved deeply into these. Widespread scepticism, particularly in deprived areas, over the economic warnings from “the great and the good” was less irrational than it was portrayed. Those who have suffered under 40 years of neoliberalism were entitled to wonder how much worse it could get, and the losses from leaving the EU will indeed weigh most heavily on prosperous sectors. That said, a recession or prolonged lower growth would bring yet more misery to poor communities.

The exact outcome will depend on policy choices. The discredited ex-Chancellor had warned that leaving would worsen public finances but his threat of further austerity through a “punishment budget” was treated with contempt. Indeed, before his sacking, Osborne himself thought better of this and instead abandoned his target of fiscal surpluses by 2020. Much is being made of similarities between some remarks in May’s first prime ministerial speech and those by then Labour leader Ed Miliband prior to the 2015 general election, notably her promise of “a country that works for everyone, not just the privileged few”. Anyone who can remember Margaret Thatcher quoting St. Francis of Assisi on her first day in office is entitled to feel cynical, and the appointment as Chancellor of right-winger Philip Hammond justifies that. But there will be a different feel to this government. The Leave vote has undoubtedly been a wake-up call to both global finance and the British establishment. There was a complacent recklessness to the “Eton boy” politics of Cameron and Osborne, which ultimately went badly wrong. May and her team are, if anything, more right-wing but have a firmer grasp of the realities of life. There will be greater care over policy and presentation, with populist toughness on migration and security providing cover on economics. The essentials of neoliberalism will be maintained and sharpened, but with pragmatism over public finances and sensitivity to the public mood. Thatcher showed how this could be done.

The Conservatives have regrouped quickly but this is not surprising. Europe has been a deep divide but ultimately this is the historic party of British capital, whose leading representatives have no doubt told the party’s senior figures in no uncertain terms to “get their act together”. By contrast, Labour is in a spiralling crisis, which it might not be able to pull out of. The Brexit vote provided a long-awaited excuse for a Westminster coup against Corbyn, blamed for the failure of the Remain campaign. Many MPs believe this but the evidence is weak. From a poll, 63% of Labour voters were Remain compared to 64% of Scottish National Party voters, but nobody blames its leader Nicola Sturgeon. The narrative that Labour could not win under Corbyn is also poorly supported by election evidence, but for many MPs it has become a self-evident truth, as are claims that he cannot lead. In the feverish atmosphere following the Brexit outcome, most of the shadow cabinet resigned and the Parliamentary Labour Party voted no confidence in Corbyn by a large majority. Corbyn refused to resign, resting on his mandate from 60% of the party membership. After hesitation, two candidates, Angela Eagle and Owen Smith, both former members of Corbyn’s shadow cabinet, have come forward but the PLP will hold a secret ballot, after which one will stand down to present a united opposition to Corbyn.

This will be a deeply unpleasant campaign. From the time of Corbyn’s election, MPs have sullied the internal party atmosphere by continual abuse, tolerated by the PLP majority, whose attempt to bully Corbyn into retirement has failed, as has its manoeuvre to exclude Corbyn from the ballot through a mendacious reading of the party rulebook, although a wealthy donor is mounting a legal challenge. But the tricks by the pre-Corbyn party apparatus continue. 130,000 people have joined Labour since the referendum but all those with less than six months’ membership are now excluded from voting. Meetings have been banned to stop motions supporting Corbyn and some local parties are now being suspended to disenfranchise his supporters. This is justified by allegations of ‘intimidation’, often pointed, without evidence, at Momentum who have refuted these. The contempt shown by the PLP towards the membership has undeniably provoked anger but many MPs willingly confuse criticism and threat. Preserving the right of MPs to ignore party opinion is at the heart of the PLP rebellion, while Corbyn continues to enthuse large numbers of members. A party split is a real possibility.

Where does policy come into all this? Both Eagle and Smith have declared themselves to be ‘anti-austerity’. Corbyn and his shadow Chancellor John McDonnell can take credit for redefining the party stance on this but acceptance by his challengers will make it less of a dividing line than it was last summer, although differences will emerge. Eagle will be unadventurous while Smith will be more opportunistic. Both will favour a less active role for the state than is likely to be proposed by Corbyn. Following recent publication of the Chilcot report, highly critical of Tony Blair’s decision to join the Iraq war, Corbyn apologised on behalf of the Labour Party. Burdened by her 2003 vote in favour of the war, Eagle has kept quiet on this, while Smith, not an MP at that time, has stated that the war was wrong but not yet endorsed Corbyn’s apology. Both Eagle and Smith back renewing Trident but while Corbyn has solid support from those opposing nuclear weapons this issue is unlikely to swing votes.

Europe was marginal in 2015 but will be prominent this time and could be decisive. Smith favours a second referendum when the Brexit terms are known, which could attract some younger supporters of Corbyn who are also keen on staying in the EU. The problem is that this runs into the realities of how the EU operates. Serious negotiations cannot begin until article 50 is invoked, which sets the clock ticking with withdrawal occurring after two years, or earlier if a deal is struck. The article makes no provision for a withdrawing state to change its mind. Extending this timetable, or applying to rejoin under article 49, both require unanimous agreement of EU states. So reversing the decision once article 50 is invoked is not simply a UK choice. Smith has also stated that people want both access to the single market and controls on immigration. That may well be true but again it runs into the problem that there is no sign that such a deal will be available without compromises. Taken together, these positions suggest a willingness to say what listeners might want to hear. Eagle, on the other hand, seems to prefer to avoid saying anything controversial. Corbyn has acknowledged that article 50 will now have to be invoked but has not indicated his approach to negotiations, although I expect him to focus on protection of worker, consumer and environmental rights now at risk, plus defence of migrants and refugees.

I shall not offer any prediction on how this will all work out. The assumptions underlying politics in the quarter century after the fall of the Berlin Wall no longer apply and we are making it up as we go along, guided I hope by some understanding of global capital and an aspiration for justice.

Readers, particularly lay readers, might find the style of writing used by the author difficult to understand at first, as it is conceptually very concentrated, and the author uses specialised terms drawn from a wide range of disciplines. For myself, reading this paper was an interesting learning exercise, which expanded and deepened my intellectual repertoire. There were many terms and concepts that I either didn’t know at all, or that my understanding about them was insufficiently precise; including the term “geonomics”! As part of my reading-learning effort, I started to create a glossary (see below, after the NOTES), which is referenced in this response, by using capital letters in square brackets ([A], [B], [C] etc).

2. DIAGNOSIS AND REMEDY FROM A METAPHYSICAL PERSPECTIVE

I found this a very interesting paper, in that it attempts diagnosis and remedy from the metaphysical perspective, as an “antidote” to the prevailing materialistic macro perspective, which confines human consciousness to a mechanistic level of thinking, masquerading as “modern” economics (eg: “homo-economicus”[1] etc).

Psychotically healthy human beings continually demonstrate that they have innate life purpose beyond the selfish maximisation (optimisation) of their materialistic consumption and accumulation needs. If human beings are forced to live exclusively at the lower levels of Maslow’s pyramid of human motivational needs[2], within an alternating dichotomy of consumerist booms and austerity busts, they will either revolt in order to re-establish stable conditions for realising their higher needs for self-actualisation, in accordance with imperative of their intrinsic metaphysical (spiritual) nature; or, they will become conditioned into a devolutionary self-destructive state of “learned helplessness”[F].

As the French writer, Jean Giono[3] warned in 1938: “… man needs spiritual comfort. Beauty is the backbone of his soul. Without it – tomorrow – he will commit suicide in the palaces of his automatic life.”[4]

I concur with the author’s geonomic[A] perspective, and that “the progressive quantity of rent[B] in a [financial]-capital[C] based economy,” has led humanity into the current impasse “of a Sisyphean[D] economy”.

3. PIVOTAL STOCK MARKET CRASHES NOT CLEARLY IDENTIFIED

There is one important instance where the author was not specific enough about historical events he was referring to, eg. in the key question he posed: “So, what went wrong with global capitalism, especially after the events of 1989, and can we identify the key mechanisms of malfunction or systemic error?”. It would have been better if the author had put a footnote explaining what he meant by “after the events of 1989”.

After some research, I have assumed that the author is referring to the recession of the early 1990s[5], that followed the 1987 Black Monday stock market crash[6], and involved the 1989–91 Savings & Loan crisis in the United States[7].

This period of global recession in the late 1980s and early 1990s, was consequent to the October 1987 Black Monday stock market collapse, which was of an unprecedented size, in that the Dow Jones Industrial Average fell by 22.6%. This collapse was larger than the stock market crash of 1929. The stock market quickly recovered, but further research might reveal that this was at the expense of a bail-in through plundering the wealth of millions of American small savers, in what is known as the savings and loan crisis[x]. It is herein posited that savings and loan associations (S&Ls) in the USA were made technically insolvent, as a result of interest rate manipulations by the de facto world central bank, the Federal Reserve System. This suspected contrived technical insolvency, was coupled with the bait of “lax regulatory oversight, which in turn allowed some S&Ls to invest in highly speculative investment strategies” (i.e. transfer payments to bail-out the stock market). As a result, 1,043 out of the 3,234 savings and loan associations in the United States failed and were closed down between 1986 to 1995. In 1996, the U.S General Accounting Office estimated that the total cost of the S&L crisis to be in the order of $160 billion, including $132.1 billion taken from taxpayers.

If what the author is refers to as the “events of 1989”, are indeed related to the above described scenario of stock market crash and recovery, then examining these events through a phenomenological lens, can help us to “identify the key mechanisms of malfunction or systemic error”, which not only plagued the world then, but which have now reached a catastrophic systemic tipping point.

4. DISTINCTION BETWEEN ECONOMICS AND BUBBLENOMICS

We have to make a very clear distinction between economics of the real economy, and “bubblenomics”[8][9] practiced in the unreal economy of financial markets. In my opinion, “bubblenomics” is the “key mechanism of malfunction and systemic error” that we are looking to eliminate. The so called “business cycle” of boom and bust within the real economy, is a symptomatic effect of the predatory-parasitic activity of “bubblenomic” practice within the unreal economy of financial markets.

The only reason that the real economy suffers from such parasitical of bubblenomic behavior, is because the mechanism of finance for real economic production, exchange and regenerative distribution, has been captured to serve the purpose of bubblenomic predators. As Michael Hudson points out, the parasite has convinced its host that the parasite and host are one organism[10]. The mother of all bubblenomic (financial) markets is the government bond market, where so called “market makers” buy the future real economy production of the people for “pennies in the pound”, securitized as State enforced debt, and and paying for such “financial assets” that represent the “wealth of nations”, with monetised purchasing rights conjured “out of thin air”, by fraudulently recording them in a double-entry social accounting system, as assets of the banking system owners, instead of as the purchasing rights of real economy producers, which rights arise from the production obligations that these producers have undertaken, on behalf of the needs/demand of society.

5. DIRECT FINANCING OF THE REAL ECONOMY WITH A SEPARATE PAYMENT SYSTEM

Financing as the allocation of existing (past produced) commodities and resources, to enable a present production of new/replacement commodities, within a certain future time frame, does not need to pass through the rentier-arbitrage system of financial markets. It can be done directly between bona fide producers in the real economy, and competent-transparent financing institutions, without the intermediary of non-producers (such as the State and central banks), and performed on a not-for-profit basis, as a civil society regulated public service. The same goes for the payment system, which should be organisationally walled off from the financing system, so that Glass-Steagall[11] is institutionally architectured into the monetary system itself, and therefore not subject to the corruption of bought/compromised politicians.

The institution of direct financing of the real economy, without the need of financial markets, and an institutionally separate but articulated payment system will make obsolete what the author describes as “the current global rent-seeking monopoly for privileges, [which] is not only unjust; [but] not efficient and not effective” from a real economy perspective. As the author correctly points out: “the rentier mechanism of an economy [i.e. bubblenomics] (…) extracting progressively value (actually energy) for no-thing, (…) with the growing boulder [snowball] of economic rent, curbing [real economy] productivity.”. There is evidence[12] that things have become so bad that we have now entered a vicious downward cycle of debt-deflation[13], which is “swallowing the entire World … [because] Central Banks have pumped trillions [as QE] into the [unreal] economy of financial markets”[14], in order to maintain the despotic bubblenomic empire.

6. PROBLEM OF TRADITIONAL TAXATION FOR FUNDING PUBLIC GOODS AND SERVICES

For the above reasons, I do not agree when the author proposes that “the legal remedy is to primarily tax economic rent and to convert it into public revenue.”. As the last paragraph in the above quoted work[4] of Jean Giono reads: “To heal from the plague means not to go back to it, but to go back to health. It is to depart from the bad. Intelligence is to withdraw from the bad.”

It is true that we need “public revenue” to fund the regenerative function of the non-commercial circuit of the economy, in terms of ecosystem regeneration, resource conservation, human capital formation, commonwealth infrastructures, goods and services, as well as maximising opportunities for everyone to realise their full human potential and life purpose. These public funds comprise monetised purchasing power that are claims on the economic surplus, which is produced within the commercial circuit of the economy, and which is inherently abundant when the economy is healthy (i.e. rentier-free).

It is also true that since ancient times, State administered taxation has been the traditional means of transferring purchasing power, as a claim on the economic surplus, from the commercial to the non-commercial economic circuit. As I say in my working paper[15]: “The evidence of experience, both past and present, shows that the traditional mechanism of taxation has been thoroughly circumvented and discredited by powerful commercial and financial sector agents, to the detriment of the institutional integrity of the State, including the systemic corruption of the process of democracy.”.

7. ARCHITECTURING MONEY TO RESTORE THE GIFT, AS A DIRECT DEMOCRACY TRANSFER OF THE ECONOMIC SURPLUS TO FUND THE PUBLIC GOOD

Fortunately, another way has been proposed by the French economist Michel Laloux[16], which restores the gift as a means for actualising the responsibility of human sovereignty, as well as being an exercise in direct economic democracy. Laloux proposes that the vital transfer of purchasing power from the commercial circuit to the non-commercial circuit, should be embedded within the architecture of a threefold monetary social accounting system, comprising institutionally separate organisations for:
(1) financing new production in the commercial circuit of the economy
(2) provision of a payment system, and
(3) provision contribution fund institutions, to collect, allocate and oversee the application of contribution funds (equivalent to tax revenues), for the regeneration and extension of commonwealth goods, services and resources, in the non-commercial economic circuit. This transfer would be implemented through the application of a demurrage based liquidity tax, to recycle stagnant accumulations of purchasing power in the payment system, from users current purchasing accounts, to their deferred purchasing accounts. At the end of each accounting year, any balance above a calculated limit would be transferred from user’s deferred purchasing accounts, to their contribution account held in separate contribution fund institutions. Individuals would have the direct democracy opportunity to channel their commonwealth contributions towards a choice-range of budget items and non-commercial provider/suppliers.

In conclusion, not only would taxation of economic rent and its conversion it into public revenue be untenable relative to the regulatory capture of the State, but even more problematic, it maintains the apex predator status of parasitical financial markets, to overrule the economic rights and obligations of humanity, despite the fact that the global system of rentier-finance is in a state of imminent catastrophic collapse. What we need now is “WEXIT” from all financial markets, and the institution of special economic zones to pilot, demonstrate and replicate: (1) the direct financing of the real economy, with (2) a separate payment system and, (3) an alternative to State administered taxation, as a means of transferring in a transparent, equitable and democratic way, the economic surplus from the commercial to the non-commercial circuit of the economy.

8. WEXIT: AN EXODUS FROM THE BUBBLENOMIC INDUCED CRASH OF FINANCIAL MARKETS

As Chris Martenson of Peak Prosperity surmises[17], financial markets have “become gigantic, globally interconnected, leveraged speculating casinos. Nothing but a massive set of bubbles in search of a pin. It looks like they may have just found one…” in BREXIT. Peter Schiff also opinions that Brexit is not the reason; but only a potential catalyst for a systemic collapse of financial markets globally[18].

Under the incumbent paradigm of money as a commodity, there are no safe havens for the 99%, see:

– Fortunes Will Be Made & Lost When Capital Flees To Safety – As safe havens are tiny markets, by Adam Taggart [19]

– Jim Sinclair-Biggest Bubble in the History of Finance [20]

The only safe haven[21] is an exodus from financial markets[22].

This means an exodus by the 99% from a despotic system of financing, payment and taxation (distribution of the real economic surplus), which is architectured to transfer economic rights and political power from the 99%, to a psychotically deranged 0.1%. The “promised land” of “safe havens from the imminent collapse of financial markets is the establishment by civil society of special economic zones[23], whereby money is re-instituted as civil society regulated public service, for the interest-free social accounting[24] of economic rights and obligations, and regulated in accordance with the rule of higher law[25].

This paradigm makes obsolete the anachronistic incumbent State enforced paradigm, whereby money is illegitimately privatised as a commodity (through fraudulent accounting), so that money can be produced and traded for speculative gain within a system of financial markets.

The paradigm of money as a virtuous social accounting system is not new. The last time such a system for the social accounting of economic rights and obligations, whereby purchasing rights (sd monetised credit) was “backed” by production obligations, which rights and obligations (debits) were simultaneously recorded in the double entry accounting system, was during the birth of the USA. See: American Credit System 1650-1796 [26]

Perhaps the time has come for the American people to take up their forgotten torch of liberty, and cooperate with the peoples of Europe and the rest of the world, in establishing a commonwealth movement and network for universal and sustainable global prosperity.

NOTES:
======

[1] In economics, homo economicus, or economic man, is the concept in many economic theories portraying humans as consistently rational and narrowly self-interested agents who usually pursue their subjectively-defined ends optimally. Generally, homo economicus attempts to maximize utility as a consumer and profit as a producer.
https://en.wikipedia.org/wiki/Homo_economicus

[2] Maslow’s hierarchy of needs is often portrayed in the shape of a pyramid with the largest, most fundamental levels of needs at the bottom and the need for self-actualization at the top.
https://en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs

[3] Jean Giono bio by Wikipedia: https://en.wikipedia.org/wiki/Jean_Giono

[4] Here is the full quote: “It is not true that all we have need of is sturdy steel, automobiles, tractors, refrigerators, electric lighting, scientific comfort. I know that all these robots make life easier, I use them myself as extensively as anyone. But man needs spiritual comfort. Beauty is the backbone of his soul. Without it – tomorrow – he will commit suicide in the palace of his automatic life.” – Jean Giono (1938), “Lettre aux paysans sur la pauvreté et la paix”.
http://data.over-blog-kiwi.com/1/56/96/02/20160418/ob_40d44e_lettre-aux-paysans-sur-la-pauvrete-et.pdf

[5] The recession of the early 1990s describes the period of economic downturn affecting much of the world in the late 1980s and early 1990s. The global recession came swiftly after the Black Monday of October 1987, resulting from a stock collapse of unprecedented size which saw the Dow Jones Industrial Average fall by 22.6%. This collapse, larger than the stock market crash of 1929, was handled effectively by the global economy, and the stock market began to quickly recover. However, in North America, the lumbering savings and loans industry was facing decline which eventually led to a savings and loan crisis which compromised the wellbeing of millions of Americans. The following recession thus impacted the many countries closely linked to the United States.
https://en.wikipedia.org/wiki/Early_1990s_recession

[6] In finance, Black Monday refers to Monday, October 19, 1987, when stock markets around the world crashed, shedding a huge value in a very short time. The crash began in Hong Kong and spread west to Europe, hitting the United States after other markets had already declined by a significant margin. The Dow Jones Industrial Average (DJIA) fell exactly 508 points to 1,738.74 (22.61%). In Australia and New Zealand, the 1987 crash is also referred to as “Black Tuesday” because of the time zone difference.
By the end of October, stock markets in Hong Kong, Australia, Spain, the United Kingdom, the United States and Canada had fallen 45.5%, 41.8%, 31%, 26.45%, 22.68% and 22.5% respectively. New Zealand’s market was hit especially hard, falling about 60% from its 1987 peak, and taking several years to recover. However the rapid rebound of the stock market largely depended on the S&L business, which was already under scrutiny before its mid-1989 collapse, sending the economy to a “hard landing” phase late that summer.
https://en.wikipedia.org/wiki/Black_Monday_(1987)

[7] The 1989–91 United States Savings & Loan crisis “was the failure of 1,043 out of the 3,234 savings and loan associations in the United States from 1986 to 1995: the Federal Savings and Loan Insurance Corporation (FSLIC) closed or otherwise resolved 296 institutions from 1986 to 1989 and the Resolution Trust Corporation (RTC) closed or otherwise resolved 747 institutions from 1989 to 1995.”.
https://en.wikipedia.org/wiki/Savings_and_loan_crisis

[8] “Bubblenomics” refers to the asset inflation-deflation manipulations which are practiced in the unreal economy of financial markets, so that rent-seeking speculators and parasitic investors, can counterfeit/extract financial claims on the real value produced by real economy producers, as well as to privatise (buy) the commonwealth factors of production (including land), and also to buy the social power apparatus of government and the media.
SEE:
(1) https://en.wikipedia.org/wiki/Economic_bubble
(2) http://www.clarity.net/~jake/bubble.htm
(3) Kent Palmer (2008), An Introduction to Bubble-nomics – https://www.academia.edu/2711384/An_Introduction_to_Bubble-nomics
(4) Bubblenomics And The Future Of Real Estate – http://www.zerohedge.com/news/2014-07-22/bubblenomics-and-future-real-estate

[9] The source of financial bubbles: extracts from: Ismael Hossein-zadeh (2016), “Marx on Financial Bubbles: Much Keener Insights Than Contemporary Economists”.
“… the main source of financial bubbles and bursts” is “… the profit from fictitious capital …” “… and its accumulation into more fictitious/parasitic capital” “… that is, profit that is made on paper or computer keyboards in the financial sector through trading or speculation in financial assets. While blaming policies or strategies of deregulation, securitization, and other financial innovations as factors that facilitated the financial bubble is not false, it masks the fact that these factors are essentially instruments or vehicles of the accumulation of fictitious finance capital. No matter how subtle or complex, they are essentially clever tools or strategies of transferring surplus value generated elsewhere by labor, or of creating fictitious capital out of thin air. Marx characterized this subtle transfer of (real/labor) value from productive to unproductive fictitious capital as “an extreme form of the fetishism of commodities” in which the real, but submerged, source of surplus-value is concealed. Marx makes a clear distinction between real profit and profit from financial bubbles. While real profit is rooted in, and therefore directly limited, by production of surplus value, profit from inflation of fictitious capital (or asset price inflation) is not—at least, not directly, immediately, or in the short-term. Marx distinguishes between a variety of profits and/or incomes—all dependent, ultimately, on the amount of surplus value created by human labor in the process of production. After thus pointing out that the limits or boundaries of the speculative finance capital are much wider than those of the industrial capital, he then cautions that this does not mean that speculative capital can expand indefinitely: “However, an obstacle is indeed immanent in its laws of expansion, i.e., in the limits in which capital can realize itself as capital”. In other words, a giant bubble of fictitious values on a narrow base of real values can expand only to a certain extent; it is bound to burst beyond that extent. In brief, Marx’s discussion of the systemic and systematic outflow of finance capital from the sphere of production to the sphere of speculation in pursuit of higher returns shows that, contrary to widespread perceptions among contemporary economists, Marx did, indeed, envision scenarios of the emergence of financial inflations and deflations, or bubbles and bursts. The discussion further signifies the superiority of his analysis of the relationship between industrial capital and (parasitic) finance capital over those of neoclassical economists, according to whom any outflow of finance capital from the sphere of production would be temporary and non-problematic, as it would soon be reverted back to the real sector of the economy (either by the invisible hand of the market mechanism a la neoliberalism, or by the state’s visible hand a la Keynesianism) to be invested productively. Therein lies the tragedy of mainstream/neoclassical economists: in their paranoid fear of Marx, they have essentially censored his economic views, thereby depriving themselves of the richest analysis of capitalism. In so doing, they have also succeeded in reducing economics as an academic discipline to what Professor Michael Hudson aptly calls “junk economics,” the official labelling of the discipline as a “science” notwithstanding.
http://www.counterpunch.org/2016/07/01/marx-on-financial-bubbles-much-keener-insights-than-contemporary-economists/

[10] Extract from an interview of Michael Hudson: “A parasite cannot take anything from the host unless it takes over the brain. The brain in modern economies is the government, the educational system, and the way that governments and societies make their economic policy models of how to behave. In nature, the parasite makes the host think that the free rider, the parasite, is its baby, part of its body, to convince the host actually to protect the parasite over itself. That’s how the financial sector has taken over the economy. Its lobbyists and academic advocates have persuaded governments and voters that they need to protect banks, and even need to bail them out when they become overly predatory and face collapse. Governments and politicians are persuaded to save banks instead of saving the economy …”.
http://michael-hudson.com/2015/10/rewriting-economic-thought/

[11] The Glass–Steagall Act describes four provisions of the U.S. Banking Act of 1933 that limited securities, activities, and affiliations within commercial banks and securities firms. In the 1999 Gramm–Leach–Bliley Act (GLBA), repealed the two provisions restricting affiliations between banks and securities firms. Many commentators have stated that the GLBA’s repeal of the affiliation restrictions of the Glass–Steagall Act was an important cause of the financial crisis of 2007–08.[9][10][11] Some critics of that repeal argue it permitted Wall Street investment banking firms to gamble with their depositors’ money that was held in affiliated commercial banks.
https://en.wikipedia.org/wiki/Glass%E2%80%93Steagall_Legislation

[12] See: “Undeniable Evidence That The Real Economy Is Already In Recession” – http://www.zerohedge.com/news/2016-05-17/undeniable-evidence-real-economy-already-recession

[13] An extract of an interview of Michael Hudson: “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 of 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.”
http://www.globalresearch.ca/the-slow-crash-the-shrinking-of-the-real-economy/5532131

[14] See: “Deflation Threatens to Swallow the World” – http://www.globalresearch.ca/why-the-black-hole-of-deflation-is-swallowing-the-entire-world-even-after-central-banks-have-pumped-trillions-into-the-economy/5503494

[15] Raymond Aitken (2016), Money: a social contract or an ” invisible hand ” of inverted totalitarianism – version 2 – 10May16 – https://www.academia.edu/25948427/Title_of_paper_Money_a_social_contract_or_an_invisible_hand_of_inverted_totalitarianism_-_version_2_-_10May16

[16] Laloux, M. (2014) Dépolluer l’économie, Tome 1: Révolution dans la monnaie.
Available at: http://www.democratieevolutive.fr/fr/Products-listing/product/l3.html (Accessed: 21 April 2016). This book has been translated into English by the convening author of this working paper (Raymond Aitken), and is in the process of being published. The title of the English edition is: Detoxify the economy, Volume 1, A revolution in thinking about money. Sample chapters available at: https://docs.google.com/document/d/1sSpFwUXMUnN9UERicsPXQ3wprY-1dZyGy0QBmh6DX4s/edit?usp=sharing

[17] Chris Martenson (2016), Brexit Shocker! – Making sense of what just happened – http://www.peakprosperity.com/comment/196632#comment-196632

[18] Peter Schiff (2016), Brexit Is Not The Reason; It’s The Catalyst, The Peter Schiff Show Podcast – Episode 176 – https://youtu.be/38qlUfslIYw

[19] Adam Taggart (2016), Fortunes Will Be Made & Lost When Capital Flees To Safety – http://www.peakprosperity.com/blog/98985/fortunes-will-made-lost-when-capital-flees-safety

[20] Jim Sinclair (2016), Biggest Bubble in the History of Finance – https://youtu.be/IYBvyn63T1w

[21] A safe haven is an investment that is expected to retain its value or even increase its value in times of market turbulence. Safe havens are sought after by investors to limit their exposure to losses in the event of market downturns. However, what are considered safe havens alter over time as market conditions change, and what appears to be a safe investment in one down market could be a disastrous investment in another down market.
http://www.investopedia.com/terms/s/safe-haven.asp

[22] A financial market is a market in which people trade financial securities, commodities, and other fungible items of value at low transaction costs and at prices that reflect supply and demand. Securities include stocks and bonds, and commodities include precious metals or agricultural products.
https://en.wikipedia.org/wiki/Financial_market

[23] The term Special Economic Zone (SEZ) is an area in which business and trade laws differ from the rest of the country. – https://en.wikipedia.org/wiki/Special_economic_zone

[24] Dirk J Bezemer (2008), Banks As Social Accountants And Social Controllers: Credit and Crisis in Historical Perspective – http://www.uclm.es/actividades/2009/workshopESHET-UCLM/Bezemer_-_Banks_as_social_accountants.pdf

[25] The rule according to a higher law means that no law may be enforced by the government unless it conforms with certain universal principles (written or unwritten) of fairness, morality, and justice. Thus, the rule according to a higher law may serve as a practical legal criterion to qualify the instances of political or economical decision-making, when a government, even though acting in conformity with clearly defined and properly enacted legal rules, still produces results which many observers find unfair or unjust. – https://en.wikipedia.org/wiki/Rule_according_to_higher_law

[26] Michael Anthony Kirsch (2013), American Credit System 1650-1796 – https://youtu.be/WSglqajuzXI

GLOSSARY:
=========

[A] GEONOMIC DOCTRINE:
“Humans own whatever they create, whereas the things found in nature, such as land, belong to all mankind.”
– Steven Kim, in his response to the paper by Stephen Ternyik: “Global Dynamic Efficiency (Towards a Long-Term Strategy)”.

[B] ECONOMIC RENT:
The concept of economic rent can be generalised as an unearned income and need not apply to physical land. The classical political economy of Adam Smith, David Ricardo, and Henry George belong to the late eighteenth and nineteenth centuries. It focussed particularly on land in the physical sense due to the structure of the economy, about which they wrote. Nevertheless the concept of economic rent still holds true, as the economy continues to function on the basis of property and rights, the concept of land can be broadened to include such things as radio spectrums and so forth.
http://www.henrygeorgefoundation.org/the-science-of-economics/economic-rent.html

[C] CAPITAL:
Capital was interestingly defined by the author in a previous paper as the “technical resources as product of accumulated labor-time”. Here is this definition in the context of its complete sentence: “Real human advancement resulted, empirically and historically, in social developments that introduced energy saving techniques into the human labor processes of converting natural resources (land) into capital (technical resources/as product of accumulated labor-time).”
SOURCE: Stephen Ternyik (2015), Geonomics, Energetics and the K-Paradox
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2673687

[D] SISYPHEAN:
Denoting a task that can never be completed. In Greek mythology Sisyphus was the king of Ephyra (now known as Corinth). He was punished for his self-aggrandizing craftiness and deceitfulness by being forced to roll an immense boulder up a hill, only to watch it roll back down, repeating this action for eternity. Through the classical influence on modern culture, tasks that are both laborious and futile are therefore described as Sisyphean.
https://en.wikipedia.org/wiki/Sisyphus

[E] LEARNED OPTIMISM:
Learned optimism is the idea in positive psychology that a talent for joy, like any other, can be cultivated. It is contrasted with learned helplessness. Learning optimism is done by consciously challenging any negative self talk.
https://en.wikipedia.org/wiki/Learned_optimism
VIDEO: https://www.youtube.com/watch?v=Me9TI9JhvZw
As Oscar Wilde said: “The difference between an optimist and a pessimist is drole. The optimist sees the donut, the pessimist sees the hole!”.

[F] LEARNED HELPLESSNESS:
Learned helplessness is behavior typical of an organism (human or animal) that has endured repeated painful or otherwise aversive stimuli which it was unable to escape or avoid. After such experience, the organism often fails to learn escape or avoidance in new situations where such behavior would be effective. In other words, the organism seems to have learned that it is helpless in aversive situations, that it has lost control, and so it gives up trying. Such an organism is said to have acquired learned helplessness. Learned helplessness theory is the view that clinical depression and related mental illnesses may result from such real or perceived absence of control over the outcome of a situation.
https://en.wikipedia.org/wiki/Learned_helplessness

[G] RADICAL SCEPTICISM:
Radical skepticism or radical scepticism is the philosophical position that knowledge is most likely impossible. Radical skeptics hold that doubt exists as to the veracity of every belief and that certainty is therefore never justified. To determine the extent to which it is possible to respond to radical skeptical challenges is the task of epistemology or “the theory of knowledge”. The Ancient Greek philosophers Plato, Cratylus and Pyrrho as well as Roman philosopher Sextus Empiricus are among those who expounded theories of radical skepticism.
https://en.wikipedia.org/wiki/Radical_skepticism

Dear Professor Maria,

Thank you very much once again for your questions.First, I would like to expand the issue of employment chalenges that women are currently facing. In stead of going to school, they are being forced to marry before fully matured due to financial constraints and traditional cultures that curb their opportunities to education. Second, off course, labor theories and policies do not ussually include a gender approach to labor chalenges. In my view, physical policy is an important element in which addressing the develpment of human capital in East African region.Physical policy is all about the effective system of taxation on the issues of sources of revenue generation for the governments and other resource mobilization.However,in the region, this policy wouldn’t be sound in narrowing the gap between the societies in terms of income and wealth inequalities.

Kind regards,

Urgaia

Many thanks. Could you expand your ideas about the employment chalenges that women are facing in your country? This is a very important issue to be addressed in the policy agenda of underdeveloped countries. However, labor theories and labor policies do not ussually include a gender approach to labor chalenges.

Regarding your answer, could you also explain what is physical policy?

Maria

Dear Professor Maria,
Many thanks indeed for your comments/ questions. In these regard, the following are responds to your questions.
1) Physical policy been addressed for enhancing human capital development in East African region.
2) Specifically, the young women have faced employment challenges.

Kind regards,

Urgaia

I would like to ask you two questions:

1) Which is the scope of the competition law institutional set up in the context of the Irish economy?
2) Which are the regulation agencies in the financial sector?

I would also like you to add the main bibliographical references of your resarch in the comments.

Maria

As you said: “East Africa has the lowest level of human capital development, nevertheless a rapid
growth in the expansion of education”.

I would like you to discuss he following questions
1) Which public policies have been addressed in order to enhance human capital development?.
2) Which are the main youth employment challenges in the context of the digital economy?

Maria