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The inverse relationship between the falling rate of profit and the amount of money looking for a "sink" to store/invest its value as wealth is reaching epic proportions, as evidenced by the soaring equity markets. The solution to so many of our problems is in the ideas of Henry George and Silvio Gesell, for starters. The Georgist idea of taxing the use of land and nature (and monopolies), and not labor or capital, is fundamental if we want to use the 3 factors of production to their fullest potential. Labor and capital are the product of our efforts, and should never be taxed. Monopolies should be competed away, leaving only the use of nature, which is the property of the whole of humanity, as the sole source of tax revenue.



Silvio Gesell's ideas about money teach us that the only form of money acceptable to a healthy society is "free money," meaning sovereign money. The German economist Joseph Huber's website, "Sovereign Money," can show readers the full picture of what this entails.



The Bank of England has officially declared what the Fed in the U.S. is afraid to - that the money supply is created from bank lending, and that the lending is done with money created not from the savings of depositors, but from nothing. In other words commercial banks literally manufacture money via loans. These loans instantly become the deposit in the account of the borrower, and are spent into the economy.



The significance of this cannot be overstated: The "loanable funds" theory is dead and all the policy positions coming from it are also dead. Here's a link to a great de-construction of the "loanable funds" theory by a Dutch economist, Servaas Storm, writing for INET:



https://www.ineteconomics.org/perspectives/blog/what-mainstream-economists-get-wrong-about-secular-stagnation



Such wonderful writing by Yanis Varoufakis should be joined by other economists to create a public conversation on the various schools of thought, as he's done here, as well as writing about the wrong assumptions we have about the 3 factors of production, land, labor, and capital.