NO.190 Keynes policy as a measure against the Great Depression

Keynes policy principles

About the symptoms of the Great Depression.

A large number of unemployed people occur. Unemployed people can't buy goods, so many companies' performance deteriorates. Companies with poor performance will reduce production scale. In doing so, the company dismisses the workers. Furthermore, the company itself goes bankrupt. For this reason, a larger number of unemployed people appear. As a result, the performance of many more companies deteriorates.

Keynes policy by the government as a measure against the Great Depression

The government conducts an investment business to hire unemployed people and pay wages. Then, the former unemployed who was paid wages purchased goods again, so many corporate performances recovered and the economy began a virtuous cycle again.

The essence of the Keynes policy is to employ unemployed and pay wages. It is the Keynes policy to carry out an investment business for this purpose.

Keynes policy principles can be explained by macroeconomics.

Reference article

From this reference article, I will only give an overview of macroeconomics.
GDP = total investment + total consumption

Total investment is the total value added of investment materials purchased throughout the country.
Total consumption is the total value added of consumer goods purchased throughout the country
Value added is an economic term, the amount of value produced in the production of goods. In product production, values ​​that did not exist at the raw material stage are created from scratch and added to the product. The price of the value added to this product is called added value.
Added value = Product sales price-All costs
Both investment materials and consumer goods are products produced by the industry. The difference between the two is whether the product is used in industrial production or not. *

The key to economic growth is that the products produced by the industry are purchased and paid for.
The key to economic growth is how much the product is purchased and paid for throughout the country.

The growth of GDP by the Keynes policy is as follows.

GDP = Total investment + Total consumption + Keynes policy share

GDP increases by this Keynes policy.

GDP = Gross Domestic Product = Gross National Income
"The value added produced is supplied and someone else's income is earned."
Gross national income is the sum of the added value of products sold throughout the country.
Total investment is the sum of wages paid to workers who produced production goods
Total consumption is the sum of wages paid to workers who produce consumer goods
The Keynes policy portion is the total amount of wages paid to former unemployed workers employed in investment projects under the Keynes policy.

Investment business that employs unemployed. How to raise funds for investment projects that employ unemployed people.

Anybody can be the main investor. The government does not have to be the subject of this investment project. I hope that the wealthy will do this investment as a charity. 

Many people in Europe and the United States recognize sympathy for the anime Thunderbird. I think that the ideal of Breath-O-Bridge has been inherited in Europe and America.

One company, not the government, may conduct this investment business.

An important aspect of Keynes' policy is what to use to finance the investment business to hire unemployed and pay wages.

The Japanese government uses taxes as a funding source for the Keynes policy, but this method has no effect.

If you use taxes, the Keynesian policy has no effect. Individuals and companies will not be able to purchase goods for the amount of tax collected. Total investment and total consumption will shrink by the size of the tax. The contraction shifts to the Keynes policy. GDP remains unchanged.
Keynes policy funds are borrowed and raised.

Underwriting government bonds by the central bank. The government issues new government bonds, and the central bank buys them. At that time, the central bank issues new currency and purchases government bonds.

In the current ultra-low interest rate environment, it is effective to have asset owners purchase government bonds newly issued by the government.

The current Great Depression is probably due to asset management in the financial markets of wealthy assets. Due to the ultra-low interest rate environment, the supply of money to society will be huge worldwide. A dynamism in which most of the currency is distributed to asset owners will be incorporated into global finance.
As a result, the rent price rises compared to the wages of the workers. Workers contract purchases of goods because of the rent burden. As a result, the performance of many companies deteriorates.

Let's buy the bonds for Keynes policy from the wealthy.

What is more desirable is that the asset owners voluntarily run an investment business aimed at hiring unemployed people.
We expect asset owners to raise funds from global finance and conduct an investment business aimed at hiring unemployed people.

One of the possibilities is that one company can raise funds for this investment business using financial technology in the financial market.

In my previous article, Saudi Aramco, a Saudi Arabian state-owned company, mentioned the possibility of doing this investment business.
The goal of Saudi Aramco is the construction of Dar ar-Isram.

The construction of Dar ar-Isram is an Islamic purpose.

Dar ar-Isram

Saudi Aramco will go public on the stock market. I thought that the purpose of the public offering of Saudi Aramco was to raise funds for the construction of Dar ar-Isram.
The important point is that Saudi Aramco's motivation for this action is a religious motive. Saudi Aramco will make every effort to achieve this goal. Saudi Aramco will achieve this goal at the cost of any sacrifice.

Saudi Aramco's asset value is 200 trillion yen. Saudi Aramco will invest at least 200 trillion yen for the construction of Dar ar-Isram.

As a result, an economic zone from the Middle East to the whole of Africa will be built.
In this economic zone, people of all ethnicities in the Middle East and Africa are guaranteed ethnic traditions, a safe world, and employment.
All ethnic groups throughout the Middle East Africa support this economic zone.

All Muslims will know that the economic zone built by Saudi Aramco is Dar ar-Isram.
All Muslims will support Dar ar-Isram and cooperate with Dar ar-Isram. I also believe that suicide bombings by Islamic fundamentalists will disappear.

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