During a visit to the London School of Economics in November 2008, Queen Elizabeth was briefed
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to brief:
informar
by academics and economists on the global crisis that had recently erupted: “It’s awful”, she exclaimed, “Why did nobody see it coming?”. Queen Elizabeth has an estimated net worth
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net worth:
patrimonio neto
of about $340 million and needn’t worry too much about making ends meet
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making ends meet:
llegar a fin de mes
. Yet many of her subjects
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subjects:
súbditos
, as well as the vast majority of the citizens of the world, unfortunately, do.
understanding moneY
And the truth was that someone did see it coming. In autumn 2006, a year before the subprime crisis
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SPEAK UP EXPLAINS
La crisis subprime. Prime es algo de primera calidad, así que subprime sería literal y eufemísticamente ‘menos que de primera’. Un término muy amplio con el que se englobaban los préstamos e hipotecas concedidos a particulares con pocos recursos. Estos préstamos se agrupaban y se vendían como productos financieros de alta calidad. Cuando los deudores empezaron a faltar a sus pagos, estalló la crisis.
blew up
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to blow up:
estallar
, Ann Pettifor, a South African economist and research fellow
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research fellow:
profesor investigador
at City, University of London, published the book The Coming First World Debt Crisis. Widely ignored at the time, her book proved to be wholly prescient
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prescient:
clarividente
. According to her analysis, at the root of the problem lies a lack of understanding of how money is created and how the financial system operates.
the casino economy
As she explains in the brief but comprehensive
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comprehensive:
exhaustivo
The Production of Money (Verso Books), contrary to what most people believe, money is not a scarce commodity
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scarce commodity:
mercancía escasa
like gold or silver. In fact, money and the rate of interest — a figure
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figure:
cifra
based on a relationship of trust between lender and borrower
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lender and borrower:
prestamista y deudor
— are social technologies. If the supply
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supply:
oferta
of money is well managed, there should be no shortage
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shortage:
escasez
of it, and consequently no need for big capitalists as the only source of investment for the whole of society. However, during the last four decades, big finance has taken advantage
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to take advantage:
aprovecharse
of the ignorance of the wider public. In collusion
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In collusion:
en complicidad
with governments and the ruling class
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ruling class:
clase dominante
, big banks and financiers have effectively run amok
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to run amok:
comportarse sin control
and treated the international markets like a huge casino.
Ann Pettifor (mild South African accent): Absolutely we should have seen it coming. Karl Polanyi wrote this book in 1944, The Great Transformation, and explained the rise of fascism. And [he] said that what happens if the governments try to detach
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to detach:
desconectar
markets from regulatory democracy, i.e.
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i.e.:
es decir (id est)
from the oversight
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oversight:
supervisión
of society, and allows them just to do as they please. And of course they then fool around
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fool around:
hacer el tonto
and make a load of money and crash
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to crash:
estrellarse
the system every so often, and destroy the lives of thousands if not millions of people. And governments sit on their hands
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to sit on their hands:
estarse de brazos cruzados (lit. sentarse sobre las propias manos)
, essentially.
THE purpose of banking
According to Pettifor, the consequences of financial markets operating outside the real economy without proper oversight or regulation is that their original goal has been subverted.
Ann Pettifor: Now for me, and this is a key issue about why globalization is wrong, which is that you cannot have markets that are detached from society. We’ve had markets for five thousand years, but they’ve been embedded
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to embed:
inserir
in societies. They’ve worked for us. We’ve done this because we manage this wonderful thing called a ‘market’ in the interest of society and we’ve always regulated markets. Now, under globalization, markets are self-regulating. They look after themselves. It’s a really awful ideology, in my view, and it goes back to laissez-faire
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SPEAK UP EXPLAINS
Laissez-faire
Dejar hacer. Se trata de un término francés que resume la ideología capitalista que sostiene que el Estado no debe inmiscuirse en el funcionamiento de los mercados, pues considera que estos adquieren su máxima eficiencia (y beneficio para la sociedad) cuando se autorregulan, principalmente por la ley de la oferta y la demanda.
, and to the idea that you shouldn’t interfere in markets because markets know best
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they know best:
ellos saben más
and all that nonsense
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nonsense:
tonterías
. Now we’re allowing markets to fight to the death on their own there, except when they get into trouble, then of course taxpayers have to bail them out
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to bail out:
rescatar
. And they are fighting to the death and they’re destroying the economies.
GOOD FOR NOTHING
Perhaps the main point of Pettifor’s books is the little known fact that it is private banks who create 95 per cent of the money supply, basically by lending money to borrowers. Of course, they do not mint
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to mint:
acuñar
coins or print notes
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notes:
billetes
— only central banks can do that. But banks have the capacity to bolster
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to bolster:
reforzar
the economy deciding to whom they lend money and under what conditions. But instead of fostering
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fostering:
promover
the productive real economy, the financial sector chooses to abuse this faculty to amass wealth through dubious if not illicit maneuvers.
Ann Pettifor: If you engage in speculation in international capital markets, you don’t make profits, you make capital gains
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SPEAK UP EXPLAINS
You don’t make profits, you make capital gains
No generas beneficios, sino ganancias de capital. La diferencia entre 'profits' y 'gains' es sutil, aunque en este contexto resulta clave. Pettifor se refiere a que los grandes capitalistas prefieren abstenerse de invertir en negocios y obtener beneficios (que son las ganancias menos los costes) y simplemente especular con su capital.
. And capital gains rise exponentially. Who the hell wants to engage
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to engage:
involucrarse
with the land and who the hell wants to engage with labour when you can not even dirty your hands and make loads of bucks effortlessly
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effortlessly:
sin esfuerzo
? That’s what’s so wrong about what the finance do. It doesn’t do anything. We invented banks for the purpose of lending into the real economy. That’s all what banks are for, right? The banks bankrupted themselves through their own speculation because the Glass Steagall allowed them to go crazy
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SPEAK UP EXPLAINS
Glass Steagall allowed them to go crazy
La ley Glass Steagall que se instauró poco después del crash de 1929 imponía una separación entre los bancos de inversión y los bancos comerciales, que gestionan los depósitos de los ahorradores. Pettifor realiza aquí una elipsis tan amplia que comete un error, pues en realidad lo que quiere decir es que la derogación de esta ley en 1999 provocó que los bancos mezclaran ambas áreas de negocio, con lo que la especulación y el endeudamiento afectó a todo el sector.
and go gambling
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to gamble:
apostar
. And we just sat back and allowed that to happen.
DEBT BONDAGE
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BONDAGE:
esclavitud, servidumbre
In a context like the current recession, Pettifor urges the public sector to increase its investment, rather than cutting back
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to cut back:
recortar
on it. This would help create jobs, which will in turn generate income in the form of tax revenues
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tax revenues:
recaudación fiscal
and consumption by the public in a virtuous circle. But, Pettifor complains, the financial sector lobbies the governments not to invest in the real economy for fear of inflation. Why? Because inflation diminishes the real volume of people’s debts, which is in fact the main asset
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asset:
activo
of the big capitalists.
Ann Pettifor: The City of London hates inflation with a hatred that you would not believe, OK?. So they want deflationary policies
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SPEAK UP EXPLAINS
Deflationary policies
Políticas deflacionarias. Son políticas destinadas a frenar la inflación, y suponen restringir el crédito tanto a empresas como particulares, y la inversiíon pública mediante recortes. Pettifor critica que el motivo por el que el sector financiero —que ella personaliza en la City de Londres— teme la inflación es que ello hace que a efectos reales la deuda se reduzca.
because it increases the price of their asset, which is debt. It’s the debt they want to be expensive. And if there’s a touch of inflation, they go berserk
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to go berserk:
enfurecerse
and policymakers go berserk.
Ignorance is doom
And if the causes of the crisis are so evident and the misdoings
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misdoings:
errores, tropelías
so outrageous
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outrageous:
inaceptable
, why aren’t we doing something to fix the system? Pettifor has her own suspicions.
Ann Pettifor: Economists don’t include money, banks or debt in their models. And they don’t teach money, banks or debt in their curricula. So if you have a complete blind spot
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blind spot:
ángulo muerto
for what the finance sector is doing, then you don’t see it when it crashes. And you have no answer to what to do when they fall down. So my book is fundamentally a massive attack on the economics profession. Now I have this — and it is a conspiracy theory, I have to admit to one although I don’t believe in conspiracy theories — I have this idea, the economics professions have done a deal with the finance sector. You do as you please
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to do as one’s please:
hacer lo que a uno le place
, we promise to ignore you, right? We’re not gonna teach money, banks and debt and you go out into the world and screw up
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to screw up:
cagarla
the world and then we’ll stand aside when the Queen approaches us and asks why didn’t you see this coming? And we’ll say, “Oh nothing to do with me, guv
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guv:
jefa (abr. governor)
.”
