"Austerity" and "profligacy" are perfectly good words to describe the consumption decisions of a household. But they are bad words to describe the consumption and investment and taxation decisions of a government. Because public finance is not like household finance.Worthwhile Canadian Initiative
Words and wartime austerity
Nick Rowe | Associate Professor of Economics, Carleton University
Good for Nick. Those are some of the most important words in the world right now.
2 comments:
I responded to a post by Nick Rowe a couple of days ago saying that he seemed to agree with Mosler’s law. He responded by essentially saying “yes”. So perhaps Nick counts as an MMTer. See:
http://worthwhile.typepad.com/worthwhile_canadian_initi/2013/06/did-finance-really-matter.html?cid=6a00d83451688169e201910352a75b970c#comment-6a00d83451688169e201910352a75b970c
If so that would indicate a huge change over the last 6 months.
Then, one can only deny the laws of arithmetic for so long...I should say the laws of arithmetic regarding the underlying system, not the arithmetic of pseudo (indeterminate) relationships that monetarists believe guide the system.
Monetary policy largely does one thing...shifts money (financial assets) from one group to another...in the net 99.9 % of households are losers in that game...credit made it look like they were winning for a while...but no more.
The curtain is lifted.
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