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The Economy Of Indebtedness

Author

Listed:
  • IONESCU, Lucian C.

    (Institute for Studies on Finance and Banking, Bucharest, Romania)

Abstract

The hypertrophy of speculative monetary and financial flows has gravely impeded the normal evolution of the real economy, exacerbating the problem of indebtedness world-wide. Some of the most important ideas of Keynes and Minsky have been selected and re-interpreted in the light of the mentioned rupture. The two types of Minsky’s instability hypothesis – ascendant and descendent – have been correlated with the evolution of long cycles. Total debt (public and private) has been analyzed (proportions and structure) in connection with new forms of ‘primitive’ accumulation and rent which have introduced a neo-feudal component in the functioning of today’s capitalist system, aggravated by the mankind’s damaging ecological footprint. The debt problem has a serious impact on the economic convergence in the European Union (nominal and real indicators). Suggestions regarding central banking and government/public sector investment policy have been included in the final part of the paper.

Suggested Citation

  • IONESCU, Lucian C., 2014. "The Economy Of Indebtedness," Journal of Financial and Monetary Economics, Centre of Financial and Monetary Research "Victor Slavescu", vol. 1(1), pages 19-24.
    • Handle: RePEc:vls:rojfme:v:1:y:2014:i:1:p:19-24
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    References listed on IDEAS

    as
    1. J. M. Keynes, 1997. "The General Theory of Employment," Voprosy Ekonomiki, NP Voprosy Ekonomiki, vol. 5.
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    More about this item

    Keywords

    total debt; indebtedness; nominal economy; international crisis; financial instability hypothesis; new ‘primitive’ accumulation;
    All these keywords.

    JEL classification:

    • A1 - General Economics and Teaching - - General Economics
    • B1 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925
    • B2 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles

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