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  • The risks of hedging

    The risks of hedging
    2026/09/02

    In this episode, Prof Steve Keen and host Phil explore the complexities of hedging, its applications, pitfalls, and its impact on markets and the economy.

    Hedging, rife in the financial and commercial world, is designed to protect our investments. If prices of our investments go down, or the cost of our business inputs go up, hedging is the insurance that stops things getting too bad. But does it work? Steve argues it doesn’t work when there’s financial crisis - when all prices go the same way. The example is people who have bought gold to hedge against equity investments, if they are forced to sell leveraged shares, they might recover their position by selling the gold, forcing that down in price too. Phil also asks whether hedging creates a distortionary impact. For example, stable companies might see higher share prices because they are seen as safe, rather than having any growth potential.

    Hosted on Acast. See acast.com/privacy for more information.
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    29 分
  • Burnham on Buying British

    Burnham on Buying British
    2026/08/25
    The UK Prime Minister Andy Burnham has said he wants government departments to focus on buying British, The UK state spends roughly £300bn to £400bn a year on public procurement—and currently treats it merely as a bureaucratic exercise to secure the absolute cheapest upfront contract, rather than using it as an economic driver. Steve says it’s a step in the right direction, but Phl asks what is it that Britain makes that the government would want to buy? And how long before the usual argument that its costing more and who’s going to pay for it?

    Hosted on Acast. See acast.com/privacy for more information.
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    40 分
  • Ways to foster innovation

    Ways to foster innovation
    2026/08/18
    Unless you are one of the tech bros, it is difficult for anyone to push on with innovative ideas, probably why the world seems reliant on the US for the next big thing. If you not running a Megacap getting money for a new idea is virtually impossible, particularly in the early stages. Even government schemes are focused on reducing risk, to the pint that they offer little more than is available from the commercial finance sector. Steve says China has a better idea, but for those countries that don’t want such centralised economy is there a way to fund start-ups that uses a mix of private funding and government assistance. Phil and Steve both have ideas on this.

    Hosted on Acast. See acast.com/privacy for more information.
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    40 分
  • Do we actually need bonds?

    Do we actually need bonds?
    2026/08/13
    There’s only one reason a government issues bonds. It’s so their account with the central bank is not overdrawn. It’s only regulation that stops the central bank from saying a rapidly expanding deficit is fine. After all, it’s an indicator of how much government money has gone into supporting the private sector. But economists and finances see that as monetising finanacing, and it’s a no no. Instead, regulations insist bonds are issued to the value of the government’s spending deficit. But what purpose do they serve, other than allowing investors to influence their price and yield, often as a response to government spending. In short, they seem to think their market pricing can influence government policy. So, why do we pay so much attention to an artificial process that only happen because we can’t trust governments to regulate their spending and keep inflation in check.

    Hosted on Acast. See acast.com/privacy for more information.
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    40 分
  • A reality check on bonds and government spending

    A reality check on bonds and government spending
    2026/08/04
    A listener (Doug) left a comment on YouTube saying I assume Phil intends to play "devil's advocate" when he speaks as though taxes are necessary for money issuance by governments with sovereign currencies. He’s worried that it might confuse new listeners to the podcast. So this week, Phil and Steve get stuck into the more contentious side of MMT – how government spending creates money, and bond issuance has limited impact on that. It depends on who is buying them. They discuss how government spending differs from household spending funded by a bank loan. Consider it a catch-up for new listeners and viewers.

    Hosted on Acast. See acast.com/privacy for more information.
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    53 分
  • AI, inequality and basic income

    AI, inequality and basic income
    2026/07/29
    Phil happened upon a book to Australian economist Joshua Gans (and Andrew Leigh) called Innovation & Inequality – how to create a future that is more Star Trek than Terminator. He discusses some of the concepts with Steve, including whether companies responsible for the creative destruction of other industries should be made to pay. As Phil puts it, if I burnt down a shop, I would possibly go to prison. But if I make that shop go out of business -and all the shops around it – because I happen to run Amazon, I face no consequences. It’s progress. But I the next chapter, the progress of AI will see more destruction, as more of us lose jobs. Then the only way we will be kept alive is by a basic income, provided by the state or possibly by people like Elon Musk. If it’s the latter, imagine the political control we would hold. So, how do we balance wealth whilst still providing incentives for innovation. And how much of that innovation is destroyed by the momentum of existing big tech players?

    Hosted on Acast. See acast.com/privacy for more information.
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    44 分
  • The Burnham Factor

    The Burnham Factor
    2026/07/21
    Andy Burnham is now the British Prime Minister but, Phil asks, aside from convening cabinet meetings in the north, will he do anything different to his predecessor. No, he will follow the same neoclassical economics approach as all Prime Ministers, with an obsession for balancing the books, rather than developing creative outcomes to distribute wealth and grow the economy. In short, it’s a slightly more attractive head, stuck on the same ugly body, he says. So what about Count Binface’s contribution to UK politics? Steve’s verdict: well, he might be trapped inside a dustbin, but its better than being trapped in an economics textbook! So, that all said, is there anything positive to from this change is stewardship of the nation?

    Hosted on Acast. See acast.com/privacy for more information.
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    45 分
  • The unrelenting progress of winner takes all economics

    The unrelenting progress of winner takes all economics
    2026/07/17
    This week Phil and Steve talk about the staggering accumulation of capital, which has ratcheted up since the pandemic. In the US the top 0.1 percent of companies hold 88 percent of all corporate assets. In 2017, the top 10 S&P companies accounted for 20% of the market cap of all 500 companies, now they account for 37%. And its not because these companies are good. It’s because the nature of products today gives them a stranglehold on their customers, however bad their offering. Steve calls it the ‘shitification’ of business and Phil managed to get Microsoft’s AI to admit just how bad their own products are. ‘Held together with duct tape’ was the gist of it. So bad products, capital accumulation, income and wealth diversity – and governments do nothing but embrace it all, ignorant of what damage it is doing to society.

    Hosted on Acast. See acast.com/privacy for more information.
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    42 分