Frank Van Lerven
A Government is not a household
29 October, 2018Claims of ending austerity ring hollow, unless we do away with the 'household' fallacy The single greatest masterstroke of the Cameron-Osborne era was to undercut future progressive policy by mainstreaming the idea that the government needs to manage its finances like a household. As the Budget approaches, we should remain sceptical of any claims, like [...]
Reshaping finance for a 1.5ºC world (NEF)
19 October, 2018What the Bank of England needs to do for a green transition. Climate change is here, and it’s not just the price of beer that is going to be affected. According to the latest IPCC report, we have just over a decade to limit climate change catastrophe. The transition to a just, sustainable economy will [...]
Ending the Fiscal-Monetary Tug-o-War (NEF and IIPP)
29 August, 2018The UK’s two most influential economic institutions are pulling in opposite directions. History suggests it’s time for the Treasury to take advantage of the fiscal potential the Bank of England affords it. Ever tried walking forwards with your right leg, whilst trying to walk backwards with your left? How long do you think it would [...]
Setting the record straight: Sovereign Money is not Full-Reserve Banking
27 April, 2017The German Bundesbank has recently released an interesting report on the role of banks, non-banks, and the central bank in the money creation process. We have a few issues with the Bundesbank article; however, the majority of the analysis is good. More importantly, the conclusions drawn from the report by news outlets and the blogosphere [...]
Two Thirds of Lenders Using Underhand Tactics For Consumer Loans
18 April, 2017Around 1 in 10 people taking out a loan in Britain do so simply to make ends meet. The market for these loans is extremely unfair – and this is not coming from a consumer pressure group but from one of the bigger banks, TSB. On BBC 4 Radio this morning, Chief Executive Paul Pester [...]
Inflation rises and living standards fall: how can the Bank of England respond?
11 April, 2017Most recent figures suggest that consumer prices are increasing, while average wages are stagnating – meaning that people across the country are facing higher costs of living. To finance higher costs of living, more and more people are borrowing. In the face of these conditions, how will the Bank of England respond? Inflation at 2.3% Latest inflation [...]
Money Creation & Interest: Is there enough money to pay off all the interest? (Part 2)
29 March, 2017This is the second part of our article dealing with the argument that bank lending must lead to escalating debt because banks don't create the money needed to pay the interest on the debt. Part 1 explained how the wrong conclusions have been drawn from the oft-repeated ‘banker on a desert island’ analogy. We showed [...]
Money Creation & Interest: Is there enough money to pay off all the interest? (Part 1)
20 February, 2017There is a lot of confusion about the role interest plays in the current monetary system. It is often suggested that the fundamental problem is not the banking sector’s ability to create money, but the idea that “banks create the money to make the loans, but don’t create the money to pay the interest on [...]
QE 101 (Part 2): How Does the Bank of England Create New Money?
27 October, 2016A lot of people can go their entire lives without asking themselves how money is created and where it comes from. On the other hand, as the Bank of England noted, many modern day economic textbooks provide a flawed description of money creation. In any case, the concept of money creation can be tricky to [...]