Alex Douglas just published a post on arches and money which I quite liked. It is an easy read, and I will just offer my spin on one of his points. It also leaks into a discussion of engineering, which I will digress into at the end of this post.Bond Economics
Alex Douglas On Arches And Money
Brian Romanchuk
3 comments:
Creation takes place via division or recombination… ie the biblical definition… ie Darwin people don’t understand this…
What is being divided or recombined when the morons say “create money!”.? Nothing…
“Money!” is a figure of speech used by Art degree people and other uneducated morons…
USD balances (abstractions of Accounting Science) are issued by US institutions with legal authority to do so… they are not created…
Does this make Real GDP king then ?
If you can't measure the money supply via bank lending due to loans being paid back. You can't measure the money supply via government spending due to private sector short term savings desires and long term savings desires and taxation always equalling spending eventually.
Is the one true measure the goods and services produced at the end of all this issuing ?
https://d3fy651gv2fhd3.cloudfront.net/charts/united-states-full-year-gdp-growth@2x.png?s=usafygg&v=202304061134V20230410&d1=19980725&url2=/united-states/stock-market
Even if year over year growth is small and consistent it means the economy is still growing. Makes you wonder why the stock market ever goes down. As Mike says it is a growth function. Makes you wonder if it's probably just all the noise and day trading and headline trading that makes it so volatile and Minsky's financial instability hypothesis that eventually causes the big drops in the markets.
“Money supply!” is a reification error..
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