Home » xyzzy » Dungeon » Modern Monetary Theory (or, how I stopped worrying about the natl debt.)
Re: Modern Monetary Theory [message #96029 is a reply to message #96002] Wed, 28 September 2022 11:48 Go to previous messageGo to next message
Rusty is currently offline  Rusty
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On the Federal Reserve with Ralph Nader & Michael Hudson guest. Here's a good history lesson on the origins of the Federal Reserve and what effect it's had on our economy. Straight up till now. This is an institution that is given free reign to indulge the rapacious banking system. Even when systemic control fraud was being conducted in the housing derivatives that led to the 2008 recession. When you look at the national debt spike that has grown to todays level check the date it began to rise. The bulk of this spike is from the federal reserve central bank propping up the banking system from it's gambling disease. This is modern monetary theory for all the wrong reasons.

Who takes the brunt of this behavior? The public does. Who's affected the most by our current inflation? The public. How is it China's inflation rate average is 2.3% when ours is 8.3%? Their banking system is public. Speculation is not allowed.

This is an interesting insight into what has warped our economy in which BOTH of our political parties instill full faith over reasoning in. Faith is appropriate for religion but has no place in running an economy. Especially with a track record, particularly in this century, which has been one crisis after another.

https://michael-hudson.com/2022/09/on-the-federal-reserve-with-ralph-nader/
Re: Modern Monetary Theory [message #96066 is a reply to message #96029] Tue, 11 October 2022 12:58 Go to previous messageGo to next message
Rusty is currently offline  Rusty
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America's Unipolar World:

As I've watched and read about the Ukrainian conflict. I've found it very easy to slip into a sort of David vs Goliath view of this war. But that may be the narrative that official media and political sources want the public to feel. Like our economic landscape is crafted.
The conflict there goes far deeper historically and more nuanced than what we're fed. A few studied people have called this conflict a "proxy" war simply with the US and Russia. Maintaining that over the years since the Soviet Union collapsed and western neoliberalism took hold there. The build up of NATO had increased rather than what might have seemed counter to the need with the Soviet threat crumbling with the Berlin wall.
But economics and it's bedfellow politics always seem to create a soap opera, or some may say, a chess match. Both probably considering the characters involved.

And we have now this conflict that like ones I've seem to hear and read about for decades now. Drag on, up's and down's, gains and losses. But this one involves the wild card of nuclear confrontation. And that ain't no joke.

Jeffrey Sachs, an economist with a long history with international geopolitical economics is worried about this one. And it's good to get another view, countervailing to the predominant ones that is all we hear about.

The world is not a unipolar world anymore.

https://www.youtube.com/watch?v=wmOePNsNFw0

What do you think?
For reference though, maybe read JFK's post Cuban Missile Crisis speech of 60 years ago.
https://www.jfklibrary.org/archives/other-resources/john-f-kennedy-speeches/american-university-19630610

Re: Modern Monetary Theory [message #96076 is a reply to message #96066] Fri, 14 October 2022 12:05 Go to previous messageGo to next message
Rusty is currently offline  Rusty
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It's been pointed out that when it comes to finance and the intricate products it creates to make a profit. To the point of bending the law. Peoples eyes glaze over. And it's newsworthy lack of print is probably justified because of this tendency. What I've put out in this thread usually gets no response, unless it's about the national debt and how that makes for the worry of some impending catastrophe.
The way this is usually handled politically is to demand reckless spending be curtailed and sensible fiscal expenditures be adopted. Corporate profits though are at an all time high. But what is that fiscal thing? It's austerity. For who? The public at large and the lower to middle classes specifically.

Now with the mid-term elections almost upon us, the deluge of ads point this out. Inflation is due to reckless spending and workers demanding more pay. We must rein this in with higher interest rates, unemployment, (to temper workers demand for higher wages), and of course austerity for those ever eroding entitlements, (a name that is an affront to working people).

It would be an interesting dialog to capture the publics attention for all this hardship foisted upon them to be aware of the role that the big banks of wall st. have had in perpetuating this mess. And how they perpetually escape the attention of even the institutions and laws enacted to regulate them. But our ingrained economic doctrine is a hands off attitude with "the markets" by government. That's big government subverting the marketplace.

Finance capitalism is the ruination of this countries, Europe's and elsewhere economies where neoliberalism has pushed banking to the head of the marketplace. It leads to de-industrialization, monopolization and parasitism by the FIRE, (finance, insurance and real estate) sectors.

Here's a series of articles to glaze ones eyes with. What we should be screaming out about. Fiscal and personal responsibility is all we get.

https://wallstreetonparade.com/2022/10/new-study-wall-street-banks-are-doubling-down-on-risk-by-selling-credit-default-swaps-on-their-risky-derivatives-counterparties/

https://wallstreetonparade.com/2022/10/shhh-dont-tell-the-fed-or-mainstream-media-that-systemic-contagion-at-wall-street-banks-is-already-here/

https://wallstreetonparade.com/2022/10/nomi-prins-new-book-no-one-wanted-to-call-the-feds-qe-a-ponzi-scheme-but-it-was/

https://wallstreetonparade.com/2022/10/casino-banking-wall-street-mega-banks-traded-more-in-their-federally-insured-bank-than-the-total-for-their-bank-holding-company/

Re: Modern Monetary Theory [message #96135 is a reply to message #96076] Wed, 02 November 2022 11:12 Go to previous messageGo to next message
Rusty is currently offline  Rusty
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This is like the sediments of history dug up and used again. Like the phrase, history repeats itself. Human beings have exhibited this age old pattern with obtaining and retaining the reigns of power and influence throughout all our history. Here's another example going on today. We only get one side of the story in our culture though. But some people can see the similarities and the implications. Two articles to contemplate concerning America and the western alliances vs China-Russia and the forming, "Southern" alliances. Who is more morally correct? Something played out through the millennia.
Two non-orthodox economists take.

Michael Hudson:
https://michael-hudson.com/2022/11/germanys-position-in-americas-new-world-order/

Jeffrey Sachs:
https://www.jeffsachs.org/newspaper-articles/d2hlnp24c7hyewetypd6rjgfesszm4
Re: Modern Monetary Theory [message #96198 is a reply to message #96135] Wed, 16 November 2022 18:34 Go to previous messageGo to next message
Rusty is currently offline  Rusty
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Nomi Prins knows finance banking from the inside out. She worked in the biggest, Bear Sterns, Chase Manhattan, Goldman Sachs. She did analysis for these banks financial engineering departments. From it she learned how the system works to amplify the never ending flow of Federal Reserve money. And because of it she eventually had a change of conscious for the harm it's done to our economy. And written books and essays trying to call attention to it. This kind of critique though is not promoted to a wide audience in our society. The gravy train is too lucrative in our banking and corporate suites to make this knowledge a household staple.

We know things don't seem kosher but there's no meaningful explanation to account for it. Other than the platitudes trotted out for every crisis heaped on us.
It's very simple though. It's a system designed to maximize the power of money that only the very few can take part in. The real people in the real economy are subject to the reality of stinginess to access from thriving that the top 10 to 15 percent of the population take for granted. Wall Street's casino.
While the real economy that makes things and delivers services, the financial economy thrives on the debt we owe them and the casino that amplifies the investments the elite can partake in. Which is why the top 10% reap 87% of Wall St's. wealth.

Forty years of Neoliberism has culminated in this dilemma. A mixed economy with manufacturing, service and finance promoting the real economy is what we once were. The tenants of Neoliberism called for off sourcing industry, small government influence in the markets and de-regulation. Principally banking. And the Federal Reserve system is the enabler for banking's gambling habits. Even when they blow up the whole economy from their avarice and political influence.

Let Nomi Prins explain it so much better. It's worth your while to understand the reality from the fantasy.
From the half way point in Richard Wolff's Economy Update. (16:00).

https://www.youtube.com/watch?v=ii3TEen_LP4&t=1s

An in depth take on her new book Permanent Distortion.

https://www.youtube.com/watch?v=52T309JE7f8

https://is2-ssl.mzstatic.com/image/thumb/Publication122/v4/67/0d/ec/670decb8-8d6b-fcb3-39e1-af6a8c961ab5/9781541789074.jpg/536x0w.webp
Like James Brown sang: "We gotta get ov'ah, before we go und'ah.
Re: Modern Monetary Theory [message #96226 is a reply to message #96198] Sun, 11 December 2022 12:20 Go to previous messageGo to next message
Rusty is currently offline  Rusty
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I happened on this interview from back in 16 of two of my favorite econ. rebels. Steve Keen is interviewing Michael Hudson. They both share their departure from the academic regime taught so rigidly in the most prestigious institutions and give insight to how they unlearned the doctrine foisted on under and grad students in the economic field. They did so by studying history. Apparently university curriculum is narrowly focused on the assumptions of an idealistic world rather than what is at hand at any given moment in time. Reality that is.

Which has made me wonder about the reality of how in my own life. I have felt with our own collective personal financial security and stability has been eroded over some decades, despite the advent of technology and promise of what the future would become. As I've read from these non mainstream practitioners of the trade of our decline, that I can relate to, is similar to what they implore as the advent of the neo Keynesian or neoliberal labeled form of economic doctrine.

Maybe people think what is going on now is an aberration, and things will get better in time. Things will pick up again and all this talk about neoliberism is just so much balderdash. I can only think of a cartoon character for that reasoning. Yogi Bears sidekick Boo Boo bear. Always saying, "I dunno Yogi". For whatever half baked, half crocked idea Yogi was pursuing.
This has been building for too long and too developed now for me to expect any good outcome of perpetually following this half baked, half crocked way of conducting affairs of the economic kind. Somethings got to give. I hope it isn't our usual human failing of aggression and war. But the history books are full of it. History in general and particularly economic history is ignored in the great learned institutions these days.

See what these guys say. It's worth your time.

https://www.realvision.com/shows/the-essential-conversation/videos/rebel-economists-unpick-historical-path-to-global-recovery-3pWN?tab=details
Re: Modern Monetary Theory [message #96228 is a reply to message #96226] Mon, 12 December 2022 19:31 Go to previous messageGo to next message
Rusty is currently offline  Rusty
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Just another article calling attention to the misery inflicted on the weaker smaller countries of the world. The world bank and the international monetary fund carry out the loan arrangements for the banking elites to capture poor countries in a cycle of austerity and debt overload. When debts become too great for governments to keep up payments, they forfeit their countries assets to these banking giants.
Bill Mitchell, Australian co founder of MMT gives the lowdown for this decrepit practice carried out around the world.

http://bilbo.economicoutlook.net/blog/?p=51024
Re: Modern Monetary Theory [message #96263 is a reply to message #96228] Fri, 06 January 2023 10:18 Go to previous messageGo to next message
Rusty is currently offline  Rusty
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Read this to ponder and confuse. Is it more propaganda alongside the propagada. Will it take decades and sober historical reflection to understand? I admire the Ukranian spirit and tenacity. But I wonder alongside, what and why this had to happen. Nothing seems real from the political and media perspective. Unless you can just swallow whatever is shoveled out like cattle feed.

Moon of Alabama (where barflies get together).

https://www.moonofalabama.org/2023/01/ukraine-the-big-push-to-end-the-war.html#more
Re: Modern Monetary Theory [message #96264 is a reply to message #96263] Tue, 10 January 2023 10:19 Go to previous messageGo to next message
Rusty is currently offline  Rusty
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Randall Wray. Co author of The Modern Monetary Theory Workbook, gives clarity to the always fuzzy logic of economics. One of his "One Pagers" PDF's. The Causes Of Pandemic Inflation.

December 6, 2022
OnePager | N o.70
The Covid pandemic caused a recession when the supply side of the
economy collapsed because of workplace shutdowns and safety concerns. This then created a demand-side problem, as wages and other
incomes fell due to rising unemployment and furloughs. Long and
complex supply chains compounded the problem, and China's "zeroCovid" policy continues to delay full recovery. Pandemic relief in the
United States and some other countries helped to restore demand,
although spending patterns were unusual--more goods, fewer services (as consumers avoided contact).
The Covid recession was thus very unusual--brought on by a
collapse of the supply side that produced a drop in demand. While
demand has largely recovered, supply has not. The continuing inflation pressures still come mostly from the supply side--which is typical, at least for the United States. All of our high inflation periods
since 1970 have been due to supply-side pressures produced by three
components of the consumer basket: oil, food, and shelter (mostly
rents and imputed rents of owner-occupied housing). So while the
trigger for the recession was unusual, the inflation we face is not at all
unusual--the same three culprits are driving US inflation today.
Beyond pandemic-related disruptions, the Ukrainian war also affects
energy and food supplies, and thus prices. Also important, although
less so, are weather-related impacts on production (especially of food)
related to global climate change.
The evidence in the United States now is that inflation is not
accelerating and is likely to gradually fall. Wages are not keeping up
with inflation, so the danger of a wage-price spiral does not seem
great. Federal government spending had already declined substantially before the Fed started raising interest rates, allowing the deficit
to drop precipitously. Indeed, the budget was heading toward a surplus. In other words, we faced strong fiscal headwinds that were sucking demand out of the economy. I think we were already heading for
a recession before the Fed raised rates. Rate hikes now make recession
even more likely. The housing market has collapsed and financial
markets are rattled both by higher interest rates and by debt and liquidity problems--as evidenced by the crypto meltdown. However, it
will take more time for inflation to come down to the Fed's 2 percent
target. I expect we will (again) suffer stagflation (rising unemployment with inflation), as we did when Chairman Volcker sharply
increased rates in the early 1980s.
Europe is in a somewhat different situation because of the severe
disruptions of the Ukraine war. Inflation pressures could be higher in
Europe than in the United States. It is likely to be a cold winter with energy in short supply, and production will also suffer--meaning
continuing supply-side problems. Much of the world looks poised for
recession as Fed rate hikes caused currencies to fall against the dollar. Central banks around the world have had to raise their own interest rates to protect exchange rates. Nations indebted in dollars have
been hit by debt problems--which will only become increasingly
severe as debt burdens climb. The UK has already experienced troubles in its financial sector as markets price in higher interest rates.
Complex and even strange linkages are exposed as problems in one
asset class generate a sell-off and price collapse of another asset class.
Another global financial crisis like that of 200709 is possible as overleveraged financial institutions try to unwind risky positions.
Some falsely claim that Modern Money Theory (MMT) policy
guided the Covid relief spending in the US and elsewhere--and that
this is what has caused high inflation. It is true that Congress responded
with two spending packages that totaled $5 trillion, without "payfors"--that is, without increasing taxes. Much of it took the form of
mailing checks to every household. This was said to be MMT policy. In
truth, MMT proponents argued against such policies, proposing
instead targeted spending--spending to be directed to support those
who lost their jobs, to those who were behind in their bills (rent, utilities), and to tackle the problems created by the Covid pandemic.
The important point is that relief should have been focused on
restoring and improving the supply side of the economy rather than
on restoring demand in the face of supply-side shortages. This could
have mitigated inflation pressures and eliminated the pressure on the
Fed to raise interest rate targets, thereby reducing the probability of
entering a period of stagflation with the looming possibility of
another global financial crisis.
We still face substantial supply constraints, in part due to Covid
but also due to decades of underinvestment in infrastructure. This, in
turn, has been due largely to misunderstanding of the true constraints
and the nature of the inflation pressures that came from the supply
side. Belief that the problem was excess demand led to the adoption
of austere fiscal policy. If we abandon misguided austerity and replace
it with well-designed investment and targeted social spending, we
can not only reduce inflation pressures and restore growth, but will
also be able to transition our economy to make it environmentally,
socially, and financially sustainable.
Senior Scholar L. RANDALL WRAY is a professor of economics at
Bard College.
Re: Modern Monetary Theory [message #96265 is a reply to message #96264] Tue, 10 January 2023 15:24 Go to previous messageGo to previous message
Wayne Parham is currently offline  Wayne Parham
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I still think we need to pay down our national debt. If we could pay down a trillion a year, we'd be even in thirty years. Seems like a good goal to me.
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