Tectonomics

Beyond Macroeconomics: the seismic flows of money and capital in the century of US$ Quadrillions.

Capital is the method whereby capitalists organise the future. The main flow of global money, and therefore wealth, is from the majority who work for wages and salaries to the tiny minority who own the capital and the workplaces. The whole arrangement is facilitated by the nation states.

New money can be created directly by the central banks. But most new money is created indirectly by its franchised banks. They do this by simply lending it into circulation. This is often called credit-money. But it is real, normal, money.

Money is converted into new capital when new shares or bonds are sold. Too much money in circulation and capital inevitably create inflation in some market at some point.

In the 2020s, excess capital runs to hundreds of US$ Trillions. This has flowed through the real economic sectors and into stocks and shares, bonds, real estate and a string of over-hyped new technologies like AI, quantum computing, carbon capture and storage, nuclear fusion, social media, Bitcoin and other virtual currencies.

The great majority of these ventures will fall short of redeeming their their balance sheet valuations. The future banking and money crash must be greater and more widespread than the near disaster of 2006-2009.

DPS

20 November 2024

222 words