Tuesday, January 17, 2017

No Capitalism Without Capital

Here comes the rain again
Falling on my head like a tragedy
Falling on my head like a new emotion
--Eurythmics

A reminder. Capitalism requires capital. Capital comes from economic resources that have been set aside (i.e., 'savings') rather than consumed. The progression is savings-->capital-->investment in projects that improve productivity and thus prosperity.

Capital does not come from a loan made by a bank from savings that it does not have. It merely pulls economic resources from other sources.

When savings are low or non-existent, there can be no capitalism.

Because we are in such a low savings environment, then the obvious question becomes: If our current economic system is not capitalism, then what is it?

Stew on that in search for truth.

1 comment:

BDub said...

Its "Kleptalism".