Fake asylum seekers are causing Inflation

[athlonmank8]

Good. Your post warms my heart. Indeed, we actually cover all our nations deficits (i.e.,Treasury checks that would otherwise "bounce") by printing new money. Then, later, the Treasury auctions off securities in face amounts matching the new money printed and spent into the economy. Thus, when primary dealers, and ordinary citizens via Treasury Direct, buy these newly issued Securities they are returning to the Treasury the new money previously spent into the economy and leaving in is place highly liquid, Treasury securities. Treasuries, even though we may treat them as a form of money, are not part of the money supply!

The MMT economists treat Treasury securities as just another form of money, albeit an interest paying form. Since treasury securities are not part of the money supply, the net of the deficit spending process --- money printing>spending>securities auction --- leaves the money supply in the private sector unchanged (remember, Treasury's are not part of the money supply even though Treasuries are a form of money!). It is as though the government bought private sector assets using Treasury securities; thus money printing due to deficit spending is not going to be a direct cause of inflation, at least not via direct expansion of the money supply. Nevertheless government acquisition does increase demand for private sector assets which could be inflationary under some circumstances. Such a circumstance might occur if the government competes for labor into a full employment economy. Think, for example, massive government infrastructure spending requiring lots of labor when labor is in short supply. We have to remember that the government is not money limited unless it chooses to be money limited. So government spending can have a price-setting affect, i.e., the price of something can be set by what the government will pay.

The Securities auctioned by the Treasury become a tool of the Central Bank. When the Fed wants to increase Bank reserves or Bank deposits it can purchase* Treasury securities on the secondary market. This replaces the securities on private sector ledgers with notational money. The Fed doesn't buy Treasuries directly from the Treasury because this would cause the transactions to register in government accounts at the Fed, whereas the Fed's goal is to have these transactions register in private sector Bank accounts.

Treasury securities have many important purposes, e.g., they are a primary tool of the Central Bank, an interest paying store of money particularly useful in foreign exchange reserve accounts, etc. Needless to say, the raising of money to allow deficit spending is NOT one of their purposes.
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*To explain where the money for Fed purchases of securities comes from is too involved to explain here, but there is no net additional printing of money when the Fed purchases securities. (It helps if you recognize that the Fed and Treasury are both part of the Government's overall money operation made to look, via legislation, as though they are completely separate operations. ( Of course, those who can't get past the crazy notion that the Fed is a private for profit Banking operation, will never be able to correctly understand Treasury and Central Bank operations.) One of the misunderstandings I see habitually crop up on ET is the belief, by nearly everyone, that the Fed determines how much money to print. This is wrong. Congress determines this when the levels of taxing and spending are set. The Fed simply acts as Congress's agent the way your home printer acts as you agent. The Fed does determine, however, what form money will take in the private sector economy --- transactional money and Treasury securities should be understood as two different, interchangeable forms of money. The Fed also determines interest rates, some directly; some indirectly.

I'm not reading that. No idea where your head is or what drugs you may be taking.

 

[Badkarma]

Fake asylum seekers from our open “ biden border” is causing inflation. Who is paying for these Fake asylum seeker services? The American people. Cities and municipalities much raise state and local taxes or cut back on sevices meant for hardworking tax payers.. The inflation will only get worse and it will show up in the deficit hence higher bond yields.
Lets not even talk about the crime some of them are bringing; thats also an economic drain.

well said you are one of the only few who understand this. I've been saying it for YEARS. these smelly migrant vermin are not only causing municipalities to invent new taxes and RAISE existing taxes but the FUD is printing MORE $ to pay for them. Print more $ to pay for migrant housing, print $ to pay for their welfare (food stamps, FREE education), print $ to pay for new gov employees in welfare social service offices. ALL that $ printing causes inflation. Supermarkets don't care how they are paid, as long as they are paid. They see increase demand for food so they raise prices more. Then gov raises how much they give to migrants so they can afford the food price increases and on it goes. IDIOTS who voted for Hussien Biden should ALL house a migrant (see how that works out).

 

[Badkarma]

you

You obviously have no interest in facts:
1. More workers = lower inflation;
2. More crimes are committed by U.S. citizens, per capita, than immigrants.
3. One of the strengths of U.S. vs other countries, have always been what immigrants add to the economy.

wow you are a soyboy. let me guess: you went to public school and are mediocre (less than) in EVERY aspect of life. you aren't good looking, you aren't an athlete, you went (if at all) to a D list college, women are not attracted to you. i.e. the typical democrat soyboy closet homo / pedo. you are SO dumb. lol "per capita" well then there it is! YOU SAID PER CAPITA SO IT'S TRUE!!! you are a retard who has a sad life

 

[Badkarma]

seriously. Most nativists would be dead in the streets if they had to deal with what immigrants do to get here and survive. Frankly most nativists are failures in life despite having the privilege of having roots and support and not having to assimilate at the same time.

then why don't you house some migrants? no room in your studio apartment? or grandma's basement? you think migrants are so brave why don't you house some? answer me? yet another jobless piker on here who is a failure in life.

 

[piezoe]

Unless those printed $ are held by foreigners, foreign gov. They can use and are using them to buy stocks in US companies, US real estates, farmlands... Eventually they will own us if we keep printing and sending them overseas.

Foreign farmland ownership has increased, both in the US and Canada. One of the largest US pork producers/processors is already Chinese owned....

This may be of interest: https://www.forbes.com/advisor/ca/real-estate/foreign-homebuyers-ban/

I think 2Rosy was attempting to be facetious. No nation that has no outstanding debt instruments denominated in a currency it can't print has any real debt. The reason being that it can, in theory anyway, pay off the "debt" at any time by printing money. However, this does not properly describe the U.S. situation with respect to its so-called "debt". The U.S. prints the money needed to pay off its Treasury Securities (i.e., "Ersatz Debt!) when it spends money it did not have into the economy BEFORE it auctions new-money-associated, Treasury securities. The newly printed and spent money then returns to the Treasury when Treasury securities are auctioned! So in the case of the U.S., and some other nations too, there is no additional printing needed to "pay of the debt". The U.S., nowadays, never really borrows in the first place, and therefore it is impossible for the U.S. to have any debt. The Treasury's auctioning of securities amounts to substituting one kind private sector U.S. money (Treasury Securities) for another kind of pre-existing, newly printed money. New money appears in the economy through the act of printing and spending it into the economy. And this act of printing and spending happens before the Treasury substitutes Securities for this same money. The only difference between these the two kinds of money is that one pays interest and has to be converted to the other kind before it's spendable. Both kinds are highly liquid government liabilities bearing inflation and political risk. The interest on the one kind of money is treated just as any other non-discretionary spending.

These government money and spending operations are, for the most part, very, very simple to understand and can be described mathematically in the form of simple identities, and still very few do understand. I maintain this confusion comes from our inability to see money from the government perspective. Instead we insist that government finances are just like private sector finances. They are NOT; yet how many times have we heard politicians drone on about the "government living within its means, just like you and I have to"!!! Are we destined to go on forever saying idiotic things like: "We will never be able to pay off the debt!", "Our grandchildren will be saddled with unconscionable debt"! bla bla bla.

The "debt" is of course the accumulated deficit which equals to the penny the money left in the private sector after taxes. Without the Ersatz Debt there would be no money in the private sector after taxes were paid. So of course we would never want to "pay off the debt". And that so-called debt, which isn't, will have to grow as the economy grows (more people, more productivity) or we'll suffer disastrous deflation.

 

[Badkarma]

I've seen less word salad gobblydegook coming out of camel face kuntala harris

 

[Slow Learning Elf]

then why don't you house some migrants? no room in your studio apartment? or grandma's basement? you think migrants are so brave why don't you house some? answer me? yet another jobless piker on here who is a failure in life.

Dude, do you even trade? 30 posts, all filled with belligerent giberish.

@Baron can we move this thread to Chitchat please? The discussion has near-zero relevance to economics

 

[Badkarma]

Dude, do you even trade? 30 posts, all filled with belligerent giberish.

@Baron can we move this thread to Chitchat please? The discussion has near-zero relevance to economics

dude what do you care what I do? you are another piker living in grandma's basement. you sound like a part-time 'barrista' at starpukes

 

[Badkarma]

dude what do you care what I do? you are another piker living in grandma's basement. you sound like a part-time 'barrista' at starpukes

ain't a bad idea

 

[Slow Learning Elf]

dude what do you care what I do? you are another piker living in grandma's basement. you sound like a part-time 'barrista' at starpukes

You really wanna go down this road?

I have been on this forum for a while (given your vocabulary, probably before you were born) and care about the quality of discussion. It’s losers like yourself that are making this place a cesspool at times. So please, pretty please, just go watch some porn instead.