Economist Quote by Michael Hudson
“Most of these charges that people pay are economically unnecessary. There's no real cost behind them. There's no real value behind them. So, they're what the classical economist called empty pricing. Prices with no real cost value. What they called rent and fictitious capital. Capital claims on junk mortgage borrowers. The pretense is that all these debts can be paid but it's all fictitious, because everybody knows - at least on Wall Street everybody knows - that many debts can't be paid.”
About This Quote
Source Book: Killing the Host, 2015
Many fees and charges are artificial, lacking real cost or value, resembling rent or fictitious capital that masks unsustainable debt.
In simple terms: Some fees have no real cost, acting like rent and hiding debt problems.
Key Takeaway
Identify and challenge empty pricing in finance.
Themes
economics
financial criticism
debt
Mood
critical
analytical
Type
analysis
commentary
When to use this quote
- budgeting
- investment decisions
- regulatory review
Key Concepts
rent theory
fictitious capital
financial engineering
Questions to Reflect On
- What fees seem unjustified in your experience?
- How can regulators expose fictitious capital?
A Different Perspective
Empty pricing can be hard to eliminate due to entrenched interests.
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