Read it at Asymptosis
How Accounting “Constrains” Economics
by Steve Roth
Getting into the nitty gritty of the foundations of MMT.
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4 comments:
http://www.youtube.com/watch?v=yoZV5jt9puc&feature=player_embedded#!
Please let me know why Mike Norman miscalculated so badly.
Thanks,
Greg
Tom,
this is a good article for an Anon who has been commenting here that "the Fed is leveraged 40:1" to take to heart.
What is the accounting?
40 of what to 1 of what?
And where is this documented in our system of National Accounts or in the Fed data releases?
ie Someone who claims "the Fed is leveraged 40:1" should be able to point to 2 numbers in a report, divide one into the other and come up with the number 40.
If you cant do that, then you are talking bibble-babble...
Resp,
Greg C,
I think he didn't appreciate private debt dynamics, what he now recognizes to be crucial. Good call on the Shiff's part, a bit clouded by his belief that the Fed can create inflation in a sinking economy, but great call nonetheless. The saw that the lending practices lead to unsustainable debt. M. Norman should have known better, b/c this is what MMT is about. Maybe he wasn't MMT then.
Thanks Tom, for the reference to this article and discussion between SRW, Steve Roth, and JKH. Very helpful to me...
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