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Helicopter Money

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Helicopter Money

‘‘Central-bank balance sheets have swelled, and policy rates have reached their “near zero” lower bounds. There is plenty of cheap water, it seems, but the horse refuses to drink…policymakers have one more option: a shift to “purer” fiscal policy, in which they directly finance government spending by printing money – a so-called “helicopter drop…The new money would bypass the financial and corporate sectors and go straight to the thirstiest horses: middle- and lower-income consumers directly, and through investment in job-creating, productivity-increasing infrastructure.’’ – Kemal Dervis

Banks and Digitalisation

Banks are creating inequality and unable to handle financial crises. They must be responsible to handle any kind of financial crisis and inequality too in line with technological advancement and digitalization. @INCOMESCO 

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12 thoughts on “Helicopter Money”

  1. That is also why there is such a push towards increasing minimum wages. Like helicopter money, it is intended to provide rebound stimulus after helping those who need it the most . Unfortunately this will be like a light mist on parched soil, it just won’t go deep enough.
    But to decrease debt and increase savings I’m afraid the only approach would be to increase taxes on the wealthiest. That money could then be used to reduce government debt which would allow for increasing interest rates for individual savings.
    If coupled with a good public relations campaign say, similar to the war bonds campaigns in the past; Households could be motivated to structure their new found wealth with a healthier balance of savings to debt.
    Saying that we need to increase taxes on the wealthiest may not be the political poison it once was . Redistributing the unbalanced wealth on the planet is a physical reality. And like global warming, denying it won’t make it go away.
    We all know the value of money printed out of thin air and we can leave the mana from heaven analogies for the comidians.

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    1. Thank you Tome for the incredible thought. Tax is the greatest economic tools to create balance if the state handle it properly and progressively. Interest rate may not be helpful to the low income group. Today’s income distribution system is absolutely unfair so itself has given the big space to be changed.

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