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.
"crowding out investment"
Earth to Krugman. The Fed sets interest rates. This is not rocket science unless you're a running out of money moron.
Yes, I have enjoyed some of his past takedowns of individuals like Schiff, but that very basic mistake in the article along with the notion the deficit spending would "crowd out investment" is what I take issue with here.
with the notion the deficit spending would "crowd out investment" is what I take issue with here. Penguin pop But we don't have pure deficit spending; instead we "finance" deficits with positive yielding sovereign debt, i.e. welfare proportional to wealth since sovereign debt (except for physical fiat which can be lost, stolen, etc) is inherently risk-free.So why invest when one can buy an inherently risk-free return instead?
Because you can make a lot more munnie that way....
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