Powell Trashed MMT, But Wall Street Sees Room for U.S. to Try It

[nooby_mcnoob]

I'm not disagreeing with you that it is happening. I'm saying that it's socialism for the rich. See my previous comments.

 

[piezoe]

There should be one small point you can make that gives us some idea that you know what you're talking about. Can you not produce a single sentence that contradicts what we're saying here ?

What are you saying?

 

[nooby_mcnoob]

What are you saying?

Meaning you are so sure that we are wrong about MMT, that we don't understand it properly, but you are unable to refute the very basic points that we're making in any way other than by appealing to some video.

 

[piezoe]

MMT says deficit doesn't matter.

Actually that is a common mis-characterization. Please see the quote, in my original post, from Jim Luke in response to one of Krugman's blogs .

 

[piezoe]

Meaning you are so sure that we are wrong about MMT, that we don't understand it properly, but you are unable to refute the very basic points that we're making in any way other than by appealing to some video.

Can you please make one of those basic points for me, and I will do my best to address it as i understand MMT from my studies? At this point I don't know if you are wrong from the viewpoint of MMT. I am not interested in proving anyone wrong. My main purpose for starting this thread is to call your attention to MMT and the great importance of understanding it at least at a basic level, because so much of what is commonly thought to be true is in fact incorrect and can easily be shown so.

 

[nooby_mcnoob]

I listened carefully, my thoughts are below. Generally, I think that you _can_ use fiat money for the benefit of society but the problem is that humans are involved. Secondly, I love the way she involved her daughter. Very good role model. Looks like a ball buster though the way she interacted with her husband.

She says the surplus that the government creates through deficit goes in the pocket of the private sector. Yeah... Right. It goes in the pocket of a select few in the private sector and always will. For the most part, the middle class does not see any of these benefits and "more government involvement" won't magically fix the issue. Very easy to see that this is true because most of my generation will live lower quality lives than their parents.

She also says that deficits are financed by US treasuries which are really savings. OK, fine I can see this.

Typical woman though... Pie in the sky thinking with no understanding of how brutal humans are.

Let's think even more pie-in-the-sky: why not directly transfer the deficit into our bank accounts based on some inflation target? No need for special interests then.

And one more pie-in-the-sky: if the government can will money into existence, why does it need to tax anything? Why take back $4 out of the $10 that you spent into the economy?

You know why: the government has no power in that case.

This is the real promise of crypto currency. One day, someone will invent a pegged crypto currency with the peg decreasing with adoption that removes the power of government from the equation.

Here

 

[srinir]

Actually that is a common mis-characterization. Please see the quote of Jim Like in my original post.

True. I should have used this quote

"What I find most interesting is the realization that what Mosler and fellow MMT’ers would recommend at this stage of business cycle would be more fiscal stimulus. You see, MMT’ers believe that in the absence of inflation (real constraints) there is no reason for the government not to continue spending. As long as there is slack in the economy somewhere, MMT’ers believe that government stimulation results in higher real GDP output."

 

[ZBZB]

credit creation

Who is doing the credit creation?

 

[nooby_mcnoob]

As long as there is slack in the economy somewhere, MMT’ers believe that government stimulation results in higher real GDP output."

Excuse me Mr Government man with whom I attended school, there is slack in my business. I'll give you a job after you finish in government if you help me out .

 

[piezoe]

True. I should have used this quote

"What I find most interesting is the realization that what Mosler and fellow MMT’ers would recommend at this stage of business cycle would be more fiscal stimulus. You see, MMT’ers believe that in the absence of inflation (real constraints) there is no reason for the government not to continue spending. As long as there is slack in the economy somewhere, MMT’ers believe that government stimulation results in higher real GDP output."

I think this is a correct characterization of thinking among MMT economists, but perhaps a little misleading unless more context is given. When MMT economists refer to slack in the economy they are usually referring to idle or unused resources, which could include an unemployed labor pool. Economic stimulus could then be used to put unemployed workers back to work, building needed resources such as infrastructure. MMT economists have also considered using the government as the employer of last resort as a means of eliminating both unemployment compensation and the need for setting a minimum wage. The basic wage paid to last resort employees would effectively become the minimum wage that employers would have to compete against. Under such a policy there would be no such thing as involuntary unemployment. The economy would always operate at full employment. Our current system uses unemployed labor to hold down wage and price inflation but that comes with excess slack, thus lowered productivity and the need to pay people for not working.