Mike Gilligan (CT mon 9th Super interests neglected) should not be too hard on super fund managers as they operate in unpredictable markets. No one can predict the future price of money, shares, and houses. You can predict that once a market starts to go up it will tend to continue to go up and when it starts to go down it will tend to continue to go down. How far up we cannot predict and how far down we cannot predict. Share prices are random in the short term and long term. The only reason we bother with share markets instead of “investing” at a casino is that over time the size of the total pool goes up while in the casino the house takes its cut and the total pool goes down.

The problem is caused by the internal operations of asset markets. Many (most) asset markets do not obey the laws of supply and demand with price acting as the control mechanism. Currently the government is injecting money into the market because banks are not lending and hence are not creating any money. The banks are not lending because they have too much debt. The problem is that to create money the mechanism we use is to create more debt (the government goes into deficit). Clearly this is not going to work because the more debt that is created the less money the banks are willing to create.
There is a way of creating money that does not create debt and it is called investing. The government is doing the right thing when it invests in infrastructure but it is doing the wrong thing when it goes into debt to fund the investment. One way of creating investment without creating debt is to give zero interest loans to people who will invest in productive enterprises where they agree to repay the money from the taxes on the profits of the investment. 

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