One of the finest shows on economic affairs was ‘Clarke and Dawe’. The two satirists collaborated from 1989 until John Clarke’s death 2017. If only this partnership were still around in the era of Covid-19 and quantitative easing. I miss their satire.

So how would Clarke and Dawe explain the current global economic recession today? I wonder…

BD: Thanks for joining, you’re a macroeconomist, correct?

JC: A pleasure to be here. Yes, I am indeed.

BD: As a response to Covid-19, quantitative easing (QE) was used by central banks. How does it work?

JC: Well, it starts at a desk in a central bank. You take the computer out of box, press buttons, click enter. You alert the banking sector and the Treasury, send both an email, and press copy. You buy bonds and send money.

BD: And why did central banks start QE? Isn’t that ‘counterfeit money’? You can’t just print money at will.

JC: They print it digitally. You press buttons with more zeros on the computer – Boom! New dollars, just like that. It’s a free ATM machine, just bigger.

BD: But there is no free lunch, though? What are the financial implications?

JC: Potential inflation, consumer prices could go up. The more money you print like Zimbabwe, the poorer you become.

BD: What do macroeconomists do?

JC: We talk about economics without stories. It’s up, down, left, or right for unemployment, CPI, inflation, GDP etc. Straightforward, really.

BD: Correct, and what about government debt globally?

JC: They’re broke. Particularly the Europeans, the Japanese, and the Americans. Debt levels are above their entire annual economic output.

BD: Right… so what does that mean?

JC: No money. Broke economies were being lent money by other broke economies, but now they are all broke. The only lenders are central banks. It’s a last resort, so to speak.

BD: My goodness. The digital printer machine is out of control, and governments are broke. What’s the next step you think?

JC: Another bail out from central banks, probably. And then a bail-out of the central banks, most likely by themselves.

BD: Correct, an ongoing merry-go-round. Is this sustainable?

JC: Yeah, we might as well be entering clown world.

BD: Correct. That’s a grim end to that story. Thank you for your time.

JC: My pleasure. Oh, I better check the gold price. And where did I leave the key to my safe deposit box?