Search

The existing literature on finance, debt, and inequality depicts economic elites as a creditor class. According to a popular thesis, over the past four decades, the rich and ultra-rich households have experienced a saving glut (excess income), which they have invested in the debts of the poor and their governments. While it is undeniable that the rich have expanded their income share at the expenses of the poor, to refer to them as 'creditors' or 'lenders' is a misrepresentation of how they actually expand their wealth and income shares by financial means. For it conceals the fact that a great deal of their investments is leveraged, that is, carried out with borrowed money. This article shows that the debts generated for the sake of affluent households easily surpass those of all other households. However, these debts are not accounted for in statistics on household debt. This is because affluent households, particularly multi-millionaires and billionaires inside the top 1%, do not simply borrow from banks, like normal households do, but they are instead absentee debtors who borrow through corporate structures of which they are dominant shareholders and ultimate beneficiaries. To gain an insight into their invisible leverage, the article looks at how much hedge funds borrow and why their leverage matters. [ABSTRACT FROM AUTHOR]

Apocalyptic thinking has a long religious and political tradition, but what place does it occupy within the temporal universe of contemporary capitalism? In this essay, we use the figure of the eschaton to draw out the loaded and ambiguous character of the future as it emerges through the condition of indebtedness. This entails a departure from political economy accounts of capitalist futurity, which stress the structural logic of financial speculation, in favour of an existential account that begins instead with the cosmology of money and debt. We argue that finance capital's fixation on the future has produced a very specific form of apocalyptic imagination, characteristic of financial society and built on a libidinal economy of leverage. Rather than offering an ecstatic end to the global process of financialization, financial eschatologies bind the contemporary subject to debt and indebtedness to the very end: an endless apocalypse, premised on the ends of finance itself. [ABSTRACT FROM AUTHOR]

"In Defence of the Nominalist Ontology of Money" by Geoffrey Ingham (published by the Journal of Post Keynesian Economics in 2021) contends that "Historicising the Money of Account: A Critique of the Nominalist Ontology of Money" (published by the same journal in 2020) is based on misunderstanding, misrepresentation, and imprecisions. The core proposition in "Historicising the Money of Account" is that the money of account, which is generally understood to be a universal attribute of money, is in fact an institution of late medieval and early modern times that has no significant equivalent in today's world (or in the ancient world, for that matter). This reply is intended to provide further clarification on the historical and ontological specificity of the late medieval institution of the money of account. [ABSTRACT FROM AUTHOR]

The article radically challenges the conventional view of modern banking as financial intermediation and rejects the mutually related notion, firmly entrenched in both the mainstream and alternative imaginary, of fractional reserve banking. By contrast, it argues that modern banks are peculiar financiers which, far from banking other people's money, are originally and primarily involved with making money by creating a most fundamental institution of capitalism: liquidity. Crucially, central to the bank-engendered creation of liquidity is a negotiation of value that does not involve any formal lending of cash by a creditor – in fact, it does not require a creditor at all. Instead, it relies on a quid pro quo of debts performed by means of discounting whereby a regime of fluid property relations of mutual indebtedness, commonly known as debt finance, is established. In this regime of liquidity, money is constructed as entirely a debtors’ money: it is the outcome of a process of monetisation of bank debts entangled with a capitalisation of other people's debts. [ABSTRACT FROM PUBLISHER]