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The Fear Pandemic and the Crisis of Capitalism

In October 2019, in a speech at an International Monetary Fund conference, former Bank of England governor Mervyn King warned that the world was sleepwalking towards a fresh economic and financial crisis that would have devastating consequences for what he called the “democratic market system”.

According to King, the global economy was stuck in a low growth trap and recovery from the crisis of 2008 was weaker than that after the Great Depression. He concluded that it was time for the Federal Reserve and other central banks to begin talks behind closed doors with politicians.

In the repurchase agreement (repo) market, interest rates soared on 16 September. The Federal Reserve stepped in by intervening to the tune of $75 billion per day over four days, a sum not seen since the 2008 crisis.

At that time, according to Fabio Vighi, professor of critical theory at Cardiff University, the Fed began an emergency monetary programme that saw hundreds of billions of dollars per week pumped into Wall Street.