[saaythatagain]

His proposal to have QE for the people is an attempt to reduce private debt in order for people to start the consumption debt bubble up again. Using debt to increase profits is a common practice in today's economy. It's called leveraging. If you have £10,000 and want to invest in shares because you think those shares will increase in price or significant dividends will be paid out, you can borrow £90,000 and purchase £100,000 worth instead of £10,000 to increase your returns. In the transaction above, the collateral is the shares. The lender of the £90,000 gets interest from you and is covered by the collateral. You get the net of the returns from the shares minus the interest you have to pay to the lender. All of this is 'economic activity'. Success is predicated on the share price increasing or the company earning more profit with which it can pay more dividends. This sets the trend for the whole economy. Companies employ tactics to inflate share prices and induce more speculation. They engage in manipulation of financial accounts. They buy back their shares. They reduce costs (wages mainly). So companies are geared towards profit which will compel them to engage in the financial market inevitably. So much profit is available in speculative financial markets. This drives up prices for assets such as bonds, stocks and real estate until everyone that can take on debt, has reached their maximum capicity which is what Steve Keen refers to. Companies and individuals have too much debt. His solution is to pay the debts instead of cancelling them i.e everyone that can't pay goes bankrupyt. This will cause inflation because borrowers will receive cash instead of having to record a bad debt on their income statement and therefore be exposed to the threat of insolvency. The only way capitalism can grow consistantly in the west is by expanding the financial market. Debt after all is borrowing from your future income. Unless you become more productive in the future, the interest will siphon off a portion of your income and therefore your spending in the future will be less. Which is why there are booms and busts in the modern capitalist economy. This is why debt availability was expanded. Buying things on finance is a common practice. Cars, fridges, tv's. Buy it now and think about paying later, but when the time to pay comes noone has money. Also, debt is used as a commodity. Trading debt attracts fees which fund banker bonuses. There is an incentive to make huge loans because the commission receive would be huge for the individual. This totally disregards the ability of the person to pay the debt back.So, overall, debt accelerates profit but also accelerates losses. Capitalist contradictions do not allow capitalists to accept losses because it's not in their self interest. Also, it would bring capitalism into disrepute because of the massive instability it would cause and therefore people would be more likely to opt for a different system.Steve Keen is a believer in the market btw. His proposal is a more radical Kenseyian approach. Delusionality. Sorry if I have been incoherent.

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