An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
not that much ($150B of USTs in 5 years which most is actually still claimed by the institutional shareholders) compared to the external sectors Trillions of $:
see Tables L.204, L.205 and L.209 that is where these balances are accounted for....
"Households" have also picked up a lot approx $500B since 2006... but these are the upper income households that end up with these surpluses for sure..
Paul Krugman also had a recent, very good post on his blog, "proving" with a IS-LM type model that because - unlike Greece - the U.S. issues its own floating currency an attack by bond vigilantes would actually stimulate the economy via a depreciated dollar.
IMO, it's interesting to observe how a neo-classical model such as IS-LM can under certain assumptions (for instance, a flat LM curve) lead to exactly the same predictions as the more general and reality-based MMT model.
That´s the reason Krugman's predictions on the developments of the current crisis turned out right. Of course, he gets it all wrong when he claims that the presently recommended deficits should, as a matter of policy, be transformed into surpluses once the crisis gives way.But it's nice to see a mainstream economist get it half right at any rate.
11 comments:
President Obama’s Council of Economic Advisers chairwoman, Christina Romer, didn't get the memo. She'd say Mike's got it backwards:
http://www.nytimes.com/2012/11/11/business/budget-showdown-offers-an-opportunity-for-progress.html
On the other hand, Paul Krugman, inching ever closer to the MMT position;
http://www.nytimes.com/2012/11/12/opinion/krugman-hawks-and-hypocrites.html?hp
"On the other hand, Paul Krugman inching ever closer to the MMT position"
Curiosity will inevitably lead one closer to the MMT position.
PK is another one all caught up in economic sectarianism.... cant get out of it... rsp,
If only employment was going up as fast. Seems like a lot of those net savings are going to the wrong places.
y,
yes like China, Japan, Opec, etc....
rsp,
Wall st.
"Wall st."
Bingo…we have a winner.
Lots of deficit spending is going overseas.
What we keep here is being captured by Wall Street.
We have to deal with each problem separately.
y,
not that much ($150B of USTs in 5 years which most is actually still claimed by the institutional shareholders) compared to the external sectors Trillions of $:
http://federalreserve.gov/releases/z1/Current/z1.pdf
see Tables L.204, L.205 and L.209 that is where these balances are accounted for....
"Households" have also picked up a lot approx $500B since 2006... but these are the upper income households that end up with these surpluses for sure..
rsp,
Matt, isn't the $Trillions a measure of the stock (~$5 Trillion)? We are leaking about $400 Billion/year.
We only have what's left to work with so how much of that is going to Wall Street/businesses compared to Households?
Paul Krugman also had a recent, very good post on his blog, "proving" with a IS-LM type model that because - unlike Greece - the U.S. issues its own floating currency an attack by bond vigilantes would actually stimulate the economy via a depreciated dollar.
IMO, it's interesting to observe how a neo-classical model such as IS-LM can under certain assumptions (for instance, a flat LM curve) lead to exactly the same predictions as the more general and reality-based MMT model.
That´s the reason Krugman's predictions on the developments of the current crisis turned out right. Of course, he gets it all wrong when he claims that the presently recommended deficits should, as a matter of policy, be transformed into surpluses once the crisis gives way.But it's nice to see a mainstream economist get it half right at any rate.
Paul it is about $40B/mo so about $500b/year... gone!
http://www.census.gov/indicator/www/ustrade.html
Here is the record of what has ended up in Treasuries but that is not all of it (some still in bank accounts):
http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt
You can see in August it was actually up $82B whoa!
rsp,
Post a Comment