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Watch the full 27-minute video at http://www.goldmoney.com/schwartz-macleod-interview. In this video Pedro Schwartz, professor of Economics at Madrid’s San Pablo University, and Alasdair Macleod of the GoldMoney Foundation, talk about savings and consumption. Schwartz talks about the connection between savings and investment, a point that is often overlooked in his view. There is no opposition between savings and consumption, as savings will eventually be used for consumption. Schwartz says that a change in mentality has to come about with regards to savings, especially when it comes to the issue of retirement. People will have to save more from much earlier in order to have a comfortable retirement.
Talking about labour laws, Schwartz states unemployment in Spain is leading to tragic social consequences. He points out that the official youth unemployment rate in Spain stands at 46% – the highest level in Europe. Our fractional reserve banking system requires a lender of last resort because the leveraging and multiplication of the base money supply puts normal checking accounts at risk. However the bailing out of bankrupt companies and countries is a different story. America’s current dollar policy will not spur growth, but will instead lead to more imbalances, and as a political consequence, contribute significantly to the further decline of the west.
This interview was recorded on November 15 2011 in Madrid.