Back to the Old Ponzi Scheme
Published at 17:46 on 7 February 2012
So, Americans are borrowing more and this “could be a sign that Americans are more confident in the economy”. Of course, the very next sentence contains the catch: “consumers are also borrowing more and saving less at a time when their wages haven’t kept pace with inflation.”
In other words, it’s the same old capitalist Ponzi scheme that’s been playing out since the 1970s: declining unionization, stagnant or declining wages, and increased debt taking the place of increased wages when it comes to consumer spending.
Maybe the capitalists will again figure out how to make it last a few years before it collapses yet again, just like real estate and tech stocks did. Big deal. Anytime money is borrowed, it has to be paid back. This Ponzi scheme will collapse just like the previous ones did.
And each time the newest scheme collapses, it does so harder than the last collapse. So it will continue until either the capitalist class realizes that income inequality threatens the capitalist system itself, or the reemergence of class consciousness prompts the ruled to successfully rebel against their rulers.
Since we’re nowhere near either point at the present time, expect the boom/bust cycle to go through at least one more iteration.