Addicted to Liquidity Injections by Thomasz Konicz

“Bernanke’s announcement of lower monthly printing of money was enough to make stock exchanges collapse in many threshold countries that massively raised the interest level and promoted a quick devaluation of the currencies there. These shocks in the semi-periphery of the capitalist world system were triggered by capital outflows that accelerated after Bernanke’s announcement…

In the wake of the credit crunch, the West discovered quantiative easing – printing money by purchasing securities from banks and other private institutions – as a way to stimulate the economic recovery. Soon we were dependent on that. The Fed now announces it will overcome this bad habit. However the panic on the stock markets triggered by the American intimation of a possible withdrawal from the QE shows that the economic recovery is fragile and depends on government interventions…

The monetary policy of printing money and zero interest is caught in a vicious circle. The liquidity glut generates a credit-driven growth… The constant injections of liquidity allowed the illusion of an economic recovery to arise… A collapse of the house of cards threatens which will lead again to an economic crash in recession… A capitalist work society collapsing in its hyper-productivity can only maintain a kind of zombie life through a permanently increasing money- and credit expansion.”

to read Thomasz Konicz’ article “Addicted to Liquidity Injections” published on 7/9/2013, click on

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