Memorandum

The objective of this research is to show that the debt servicing problem is related to the present structure of monetary payments and the source of a peculiar anomaly: because of the payments of interests on its external debt, an equivalent amount of the indebted country's commercial exports is bound to remain unpaid. Hence, the international earnings of the country drop, not only in the trivial sense in which they are used to paying for the interests on its external debt, but also in the far more worrying sense that the payment of interests causes a total loss of twice the amount due.
As a consequence, interests on external debt are paid twice, thus causing an unjustified loss that weighs heavily on the population of an impressive number of countries. In a series of papers (Luanda papers), Bernard Schmitt shows the context in which such absurd double payment occurs and proposes an original accounting solution to the problem.

Unemployment

What are the causes of involuntary unemployment? Contrary to what is often believed, it can be shown that pathological unemployment is due not to the behaviour of economic agents, but to a monetary anomaly affecting the process of capital accumulation. At the core of the anomaly is the fact that profits give rise to a bank deposit that never dries up, thus generating repeated financial lendings of the same sum. Once the process of capital accumulation has reached a level that no longer allows for a positive difference between natural and monetary rates of interest, new investments are necessarily reduced and employment shrinks.
The analysis propounded here develops along these lines and leads to a proposal for a monetary reform allowing capital to accumulate consistently with the very nature of bank money and with the logical and factual distinction between money, income and capital.

Relative Price Indeterminacy

Neoclassical analysis, as well as a great part of Keynesian analysis, rests on the possibility to determine (relative) prices through direct exchange. Seriously challenged by the recent attempt to set out general equilibrium models of monetary economics, the neoclassical paradigm has not yet been abandoned. On the contrary, it still plays a fundamental role in most of theoretical economics. Yet, it is possible to prove 'beyond reasonable doubt' that relative prices are logically undetermined within neoclassical theoretical framework.