The Financial System Limit: Radical thoughts about money

David Kauders

This book shows that all schemes that borrow from the future are thwarted by three related concepts:

the true cost of debt to society,
the central banking economic cycle, and
the financial system limit.

The author challenges the existing academic and political consensus about how economies should be managed. Estimates show that one-fifth of all economic output is spent on paying interest: this is too high an overhead and should not be allowed to increase. The old arguments about sound money versus stimulus, as well as contemporary arguments that governments controlling their own currency can create as much credit as they wish, are fundamentally inappropriate to the deflationary world that we are moving towards.

Whether you are a concerned individual, an academic, politician, banker or even a policymaker, read about a different view of the current financial orthodoxies, one that will provoke serious debate and even action.

“Radical thinkers might have a point” was how the Financial Times described David Kauders’ first book The Greatest Crash: How contradictory policies are sinking the global economy. This new book offers further original thought.

As some e-readers do not display large diagrams effectively, Figure 1 and Figure 7 are available to view.

Listen to BBC radio interview 20 July 2020

Guest articles

The London Economic 20 July 2020 - Increasing the UK's total debt will not help us escape recession

Business Matters Magazine 16 July 2020 - Introducing the Financial System Limit

Public Finance 24 July 2020 - Debt limit: why we need a new financing approach

Part one: Three radical thoughts

1 The financial system limit

2 Debt interest is a cost to society

3 The central banking economic cycle

Part two: Academic theory and case studies

4 Academic theory

5 Two case studies of the financial system limit

6 Pensions

Part three: How can the world escape its debt problem?

7 Existing ideas

8 Tackling the cost of interest to society

Part four: The pandemic and the financial system limit

9 Impact of the pandemic

10 Deflation

Reviews

"The author provides a historical view of how we reached the point where the level of global debt is unsustainable and now compounded by a global pandemic. The book is understandable by those without a deep financial background.

"Kauders, who has decades of experience as an investment manager makes the case for the difficult situation we, as global citizens, are confronted with." - Librarything reviewer

* * *

"The book pleas to measure interest cost on total debt in relation to economic output. A deep recession and consequential financial upset were inevitable in a world that could not resolve the conflict between stimulus and austerity, a world that remained addicted to debt, a world that refused to admit the limit to the growth of debt caused by the cost of servicing it. That's what David Kauders wants to highlight." - Hank van der Klis, Netherlands

Other books by David Kauders

The Greatest Crash: How contradictory policies are sinking the global economy

Understanding Brext Options: What future for Britain?