I guess they haven't figure out that Steve is Keynesian yet.Following his somewhat epic blog debate with Paul Krugman, Steve Keen appears on Capital Account with Lauren Lyster to debunk more Keynesian propaganda and the kleptocratic status quo 'debt doesn't matter' arguments.
The post is of interest to see what "the other side" is making of it.
Anyway, it good that Steve and Monetary Circuit Theory (MCT) is showing up there and at Mish's, especially since MMT and MCT are getting more closely in agreement.
Read it at Zero Hedge (with RT video of Keen)
Steve Keen On Why Debt Matters "All The Time" And The Need For "Quantitative Easing For The Public"Submitted by Tyler Durden
UPDATE: Mish predictably hates the debt jubilee.
Steve Keen Goes Off the Deep End With a "Debt Jubilee" (Free Money to Consumers) Proposal
But the good news is that Mish is on board with important monetary analysis that MCT and MMT share.
I am in general agreement with Keen on numerous things.
For example, I agree 100% with Keen that lending comes first and reserves later. I also agree with Keen that the notion of excess reserves is fatally flawed, and so is the notion of money multipliers.
I scoff, along with Keen, with the idea that excess reserves are going to come pouring back into the economy causing hyperinflation or massive inflation.
For a discussion, please see my December 21, 2009 article Fictional Reserve Lending And The Myth Of Excess Reserves in which I rebut the idea espoused by Robert Murphy that the Inflation Genie is About to Get Out of the Bottle.
The idea was silly then and it is still silly now. I believe events have proven as such.
However, start giving money away as Keen proposes and I would change my tune about inflation in a hurry. Note that QE is essentially a loan but Keen's proposal is an outright gift....
Bear in mind that I am a big admirer of Steve Keen. Steve has taught me a lot. I like his debt model. I just do not like his solution. It cannot and will not work, for reasons that quite frankly should be obvious.Mish thinks a debt jubilee would be inflationary and says he doesn't mind some deflation.
Mind you there is absolutely nothing wrong with price deflation.The problem with deflation is that once prices start falling then self-interest dictates waiting to buy until prices are lower, and lower.... Which increases saving. Which if not offset results in economic contraction due to lagging demand. The old paradox of thrift. What's good for an individual is bad for the economy as a whole and thus ends up being bad for all the individuals that make it up.
Who out there does not want the price of oil to drop or the price of food to drop? Who does not want more for their money at the department store? Who does not want the price of a college education to drop?