---
title: "V-curves and Taistoism | Tuomas Malinen | Negotiator 38"
titleOriginal: "V-käyriä ja taistolaisuutta | Tuomas Malinen | Neuvottelija 38"
episodeNumber: "38"
guest: "Tuomas Malinen"
datePublished: 2020-10-01
duration: "33:49"
youtube: "https://www.youtube.com/watch?v=NLMAlxB60PU"
captionsVtt: https://www.neuvottelija.com/podcast/episodes/ep38-v-kayria-ja-taistolaisuutta-tuomas-malinen/captions.en.vtt
captionsSrt: https://www.neuvottelija.com/podcast/episodes/ep38-v-kayria-ja-taistolaisuutta-tuomas-malinen/captions.en.srt
originalLanguage: "fi"
topics: ["finnish_economy_policy","investing_markets"]
subtitleMethod: "none"
provenance: "Owner page assembled from the MacWhisper SRT transcript, YouTube metadata and the neuvottelija.fi episode record. Chapter timecodes are taken from the transcript; no caption files are published with this page."
fiCanonical: "https://www.neuvottelija.fi/fi/episodes/44-neuvottelija-38-v-kayria-ja-taistolaisuutta-tuomas-malinen"
canonical: https://www.neuvottelija.com/podcast/episodes/ep38-v-kayria-ja-taistolaisuutta-tuomas-malinen/
---
# V-curves and Taistoism | Tuomas Malinen | Negotiator 38

## Chapters

- [00:00](https://www.youtube.com/watch?v=NLMAlxB60PU&t=0s) The V-curve that did not arrive
- [02:31](https://www.youtube.com/watch?v=NLMAlxB60PU&t=151s) Three scenarios with no good option
- [05:09](https://www.youtube.com/watch?v=NLMAlxB60PU&t=309s) A banking crisis as the baseline
- [07:53](https://www.youtube.com/watch?v=NLMAlxB60PU&t=473s) Where would growth come from?
- [10:31](https://www.youtube.com/watch?v=NLMAlxB60PU&t=631s) The prime minister versus the business leaders
- [13:11](https://www.youtube.com/watch?v=NLMAlxB60PU&t=791s) Corporate social responsibility and China after 1978
- [15:43](https://www.youtube.com/watch?v=NLMAlxB60PU&t=943s) New voices enter the debate
- [18:33](https://www.youtube.com/watch?v=NLMAlxB60PU&t=1113s) How the support money was handed out
- [21:03](https://www.youtube.com/watch?v=NLMAlxB60PU&t=1263s) The Finnish banking sector versus Southern Europe
- [23:38](https://www.youtube.com/watch?v=NLMAlxB60PU&t=1418s) The recovery fund, the citizens' initiative and Vanhanen's answer
- [26:14](https://www.youtube.com/watch?v=NLMAlxB60PU&t=1574s) Eurobonds, communication and the net contributor's numbers
- [28:45](https://www.youtube.com/watch?v=NLMAlxB60PU&t=1725s) The regional tour, MMT and the case for an adult debate
- [31:15](https://www.youtube.com/watch?v=NLMAlxB60PU&t=1875s) Closing: blow the whistle on the borrowing

## Summary

GNS Economics CEO Tuomas Malinen explains why the firm's latest Q-review contained no positive scenario at all for the first time: the options are collapse, reset and great inflation. A European banking crisis has become the baseline. Malinen unpicks why record-low junk bond yields cannot coexist with record-high large corporate bankruptcies unless a central bank has broken the pricing mechanism, and why debt-financed stimulus in an over-indebted economy creates the conditions for a debt crisis. The second half covers the public clash between the Finnish government and business leaders, corporate social responsibility, and the quality of the debate over the EU recovery fund.

## What is discussed

- **No positive scenario.** GNS Economics has always published three scenarios — most likely, bad and good. In this Q-review it could not construct a positive one. The three are collapse, reset and great inflation.
- **The broken credit mechanism.** US junk-rated corporate bond yields sit at record lows while large corporate bankruptcies sit at record highs. Normally the two move together; Malinen's reading is that the Federal Reserve has broken the pricing mechanism, and that markets carried by liquidity rather than earnings is what preceded 1929.
- **Banking crisis as baseline.** Euro-area GDP fell 12 per cent in Q2 and 3 per cent in Q1, on top of a recession that began in late 2019. On the ECB's own stress tests the sector cannot absorb this, which is why a banking crisis is the baseline for the first time.
- **The growth question.** After a decade of stimulative rates, with indebted companies and productivity flattened by zombification, Malinen asks what would actually feed organic growth — and argues that shovelling on debt in its absence creates the conditions for a debt crisis.
- **The recession spiral.** 26 million Americans still on unemployment benefit feeds through consumption to company results, debt service and banks, which then tighten lending and deepen the cycle.
- **Prime minister versus business.** Malinen calls the prime minister a Taistoist and argues it is not a prime minister's role to comment on companies cutting production when demand collapses. He welcomes business leaders entering the debate while arguing they should not have had to.
- **Corporate social responsibility, defined.** A company's duty is to remain competitive and productive so it can employ and pay wages; the engine of development is private ownership pursuing profit, as in China from 1978 onward.
- **Support money and the task force.** Distribution criteria were inconsistent — some recipients must repay investment funding, some applied through shell companies — and President Niinistö's proposed economic task force of economists, officials and finance directors would, in Malinen's view, have designed a better mechanism.
- **Finnish banks versus the continent.** Deposits near a hundred billion make the domestic sector look solid, but on integrated markets a shock spreads, and banks that expanded their loan books most aggressively are the usual casualties.
- **The recovery fund debate.** Continuity is built into the mechanism; the claim that a citizens'-initiative vote equals a vote on EU membership is called absurd; finance minister Matti Vanhanen said he had never considered EU debt; and Finland receives three billion against a contribution above six, eight with interest.

## Watch

The recording lives on the Neuvottelija channel: [V-käyriä ja taistolaisuutta | Tuomas Malinen | Neuvottelija 38](https://www.youtube.com/watch?v=NLMAlxB60PU).
A Finnish edition of this episode is published at [www.neuvottelija.fi](https://www.neuvottelija.fi/fi/episodes/44-neuvottelija-38-v-kayria-ja-taistolaisuutta-tuomas-malinen).

---

Cite as: Sami Miettinen, Neuvottelija — V-curves and Taistoism | Tuomas Malinen | Negotiator 38, https://www.neuvottelija.com/podcast/episodes/ep38-v-kayria-ja-taistolaisuutta-tuomas-malinen/, 2020-10-01. For quotes include episode 38 and timestamp.