Russia says it's using bitcoin to evade sanctions — Dan Primack

The bottom line: This development could create a challenge for President-elect Trump, who is both a crypto convert and advocate for U.S. dollar dominance.

Axios
Russia says it's using bitcoin to evade sanctions
Dan Primack

Stable Coins

 

STEM Tech bros figuring out a way to safely bypass the current Art degree administered inefficient and sometimes treacherous banking system…

🚨CHAMATH: "SpaceX uses Stablecoins. They collect payments from Starlink customers and when they aggregate them in long-tail countries, they don't want to take the FX risk or deal with sending wires, so they'll swap into stablecoins, send it to the US, and then swap back to USD." pic.twitter.com/eHxGCW919y

— Autism Capital 🧩 (@AutismCapital) December 21, 2024

Reserves in SLR

 

Have to watch to see if banking lobby again approaches a now new GOP government with this regulatory modification request… last time in 2021 nutty Pocahontas led Dems wouldn’t agree with it so we’ve remained susceptible to  the financial asset volatility Art degree monetarists can cause when they “inject some pumped in money!” in their characterizing deranged way they think Accounting abstractions are REAL…

I think UST should be in the SLR computation, although there might be some weighting of risk according to duration.

O/N reserve balances definitely should be excluded, as done by BoE and currently ECB.

— Kim Driver (@KimDriver11) May 5, 2023

If we can get this then there will be A LOT of reduction in realized volatility going forward while most participants will be still be paying the historic volatility prices…  

🤔

Trade deficit

 

Good point by Setzer … if they stick Trump with the “debt ceiling!” he could end up going after all these foreign USD savings to fund his agenda…

I see that President elect Trump's eye has turned to the trade deficit with Europe --

So a reminder that the single most important thing the US could do to bring down the deficit with the EU is to reform the US corporate tax code to end the pro pharma offshoring provisions

1/ pic.twitter.com/ITaXmbwsQJ

— Brad Setser (@Brad_Setser) December 20, 2024

Bond market now pricing in one 25 bps rate cut by Fed in 2025

 

Trump is never going to stand for this and will go to war with the Democrat Fed monetarist morons… 

The bond market is now pricing in just one 25 bps rate cut by the Fed in all of 2025. Back in September six 25 bps rate cuts were expected.https://t.co/l5IYmkf6Ih pic.twitter.com/syX4RcqQaP

— Charlie Bilello (@charliebilello) December 19, 2024

Trade Isn't Money for Nothing — Stephanie Kelton

In MMT terms, imports are a real gain and exports are real loss, where "real" means "stuff" in the sense of resources used in production including and the labor that gets embedded. T

The importing country is getting commodities that the members of society in the exporting country are not able to enjoy in spite of having produced them, while the members of society of the importing country are enjoying those commodities instead of the actual producers. 

So, from a real point of view rather than a financial one, importers are getting a better deal in exchanging currency for actual goods — almost. Imports mean that the importer is receiving embedded labor as part of the deal which may affect employment in the importing country negatively Exporting has the opposite effect on labor by creating jobs. But these jobs are producing goods for others rather than the producer country.

Focusing on the financial aspect of the exchange obscures this. The Trump team seems to be overly focused on the financial aspect of international transactions.

On the other hand, unlike the US which is a net importer, China is a net exporter. The reason is that China's domestic demand is insufficient to absorb its productive potential resulting from it policy toward primary investment in productive capital. 

The export market serves to provide employment where the domestic market is lacking in demand to do so. Addressing this is is a current topic in China now, and the leadership is working on policy planning to reverse this condition by increasing domestic demand and thereby domestic consumption as a percentage of the economy. The goal is to do this without increasing moral hazard resulting from "easy money" and "hand outs" in form of "helicopter money."

Leaving out a lot of detail, China is a large and diverse country, so increasing demand domestically across the board in an equitable fashion is challenging. The conclusion is that this eludes central planning and policy that acts directly. The currency planning debate is focused on doing increasing domestic demand regionally and locally to take diversity and equity into account in a socialistic environment., e.g, without overly increasing inequality. China wants to avoid what has been happening in the West, with the top of the town profiting inordinately from policy.

The Lens
Trade Isn't Money for Nothing
Stephanie Kelton | Professor of Public Policy and Economics at Stony Brook University, formerly Democrats' chief economist on the staff of the U.S. Senate Budget Committee, and an economic adviser to the 2016 presidential campaign of Senator Bernie Sanders

The Tyranny Of The Myths — NeilW

Economics is often described as the dismal science, but it’s more apt to call it the mystical science. For generations, the field has been ruled by aphorisms that sound profound but crumble under scrutiny. These sayings, like “tighten your belt in tough times” or “the market knows best,” are not neutral observations. They are myths crafted to justify particular views of how society should be run—views that often prioritise the interests of the few over the many.

Take monetarists, for example, with their obsession with controlling inflation through tight monetary policies. Their aphorisms reinforce the “sound money” myth, which ultimately serves financiers by ensuring that debt repayments hold more value than wages. Similarly, New Keynesians push the myth of the impartial, unelected central bank—a supposedly noble institution that must remain insulated from democratic accountability to protect us from our worst instincts. But making “correct decisions” for whom? These systems, by design, elevate the interests of those who already hold power and wealth.

A New Compass for a Modern Economy

In contrast, a more honest approach to economics would start from the premise that democracy can be trusted—that the people of a nation have the agency to shape its future via the ballot box. This is the bedrock of what I see as modern economic thought, encapsulated by a simple aphorism:

It is better to give poor people a job than rich people a bung...

New Wayland

The Tyranny Of The Myths
NeilW

See also

Keeper Keynes quote if you don't have it on file already.

Lars P. Syll’s Blog
Economics — a pseudo-analogy with physics
Lars P. Syll | Professor, Malmo University

Episode 9 (S2) of the Smith Family Manga is now available – the Prime Minister embarrasses himself —Bill Mitchell

Today (December 13, 2024), MMTed releases Episode 9 in the Second Season of our Manga series – The Smith Family and their Adventures with Money. Have a bit of fun with it while learning Modern Monetary Theory (MMT) and circulate it to those who you think will benefit.

William Mitchell — Modern Monetary Theory

Episode 9 (S2) of the Smith Family Manga is now available – the Prime Minister embarrasses himself

Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Argentina ends deficit for first time in 123 years…

 

Dour looking group taking a victory lap:

🇦🇷 MILEI: ARGENTINA ENDS DEFICIT FOR THE FIRST TIME IN 123 YEARS

"The deficit was the root of all our evils—without it, there’s no debt, no emission, no inflation.

Today, we have a sustained fiscal surplus, free of default, for the first time in 123 years.

This historic… https://t.co/uszEgPd493 pic.twitter.com/nt5jJGQM1V

— Mario Nawfal (@MarioNawfal) December 11, 2024

Their equity market index responding favorably….

But they have been drastically reducing their risk free rate at the same time:

"The First Cause of Stability of Our Currency is the Concentration Camp": Central Banker Solidarity on the Road to Hitler's Czechoslovakian Gold — Pavlos Roufos

This is an article on the history and politics of central banking. As such it is important for understanding the details of MMT institutional analysis regarding banking in historical context.

There is also some fascinating information about Reichsbank President Hjalmar Schacht.

It also provides insight into how central bankers still think and operate. It's a club.

Notes on the Crisis
"The First Cause of Stability of Our Currency is the Concentration Camp" [Adolf Hitler]:
Central Banker Solidarity on the Road to Hitler's Czechoslovakian Gold
Pavlos Roufos

See also:

"The powers of financial capitalism had (a) far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank... sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world." 

    

Carroll Quigley, Tragedy and Hope: A History of the World in Our Time. New York: The Macmillan Company, 1966, VII, page 324.

Carroll Quigley (1910-1977) | Professor of History at Georgetown University, member of the Council on Foreign Relations (CFR), mentor to Bill Clinton.

Can BRICS Create a Multipolar World? — Fadhel Kaboub (MMT economist)

Decolonize to Dedollarize!

I’m often asked whether BRICS is going to be the game-changer that will disrupt the current geopolitical hierarchy, dedollarize the system, and create a new multipolar word. My position has always been that we can’t dedollarize a system that hasn’t been structurally decolonized yet, and that no new multipolar world can be born without Africa and the rest of the Global South being repositioned away from the bottom of the global hierarchy and at the center of a New International Economic Order.…

Global South Perspectives—Reflections & Analysis by Fadhel Kaboub

Can BRICS Create a Multipolar World?
Fadhel Kaboub, Associate Professor of economics at Denison University (on leave) and President of the Global Institute for Sustainable Prosperity. He currently serves as the Under-Secretary-General for Financing for Development at the Organisation of Educational Cooperation in Addis Ababa, Ethiopia.He also held a number of research affiliations with the Levy Economics Institute, the John F. Kennedy School of Government at Harvard University, the Economic Research Forum (Cairo), Power Shift Africa (Nairobi), and the Center for Strategic Studies on the Maghreb (Tunis). Fadhel is Tunisian-American MMT economist. Ph.D. in Economics & Social Science Consortium, 2006, University of Missouri - Kansas City. M.A. in Economics, May 2001, University of Missouri - Kansas City. B.S. in Economics, June 1999, with Distinction

Austerity cultist Kenneth Rogoff continues to bore us with his broken record — Bill Mitchell

His latest intervention (November 28, 2024) –
Europe’s Economy Is Stalling Out – was published by Project Syndicate, which regularly gives space to these nonsensical mainstream articles.

The simple proposition that Rogoff offers is:

"As Germany and France head into another year of near-zero growth, it is clear that Keynesian stimulus alone cannot pull them out of their current malaise. To regain the dynamism and flexibility needed to weather US President-elect Donald Trump’s tariffs, Europe’s largest economies must pursue far-reaching structural reforms."

And those structural reforms have to tackle the:

"… bloated and sclerotic welfare states to blame?"

Apparently, those that hold to the most basic macroeconomic rule that spending equals output and income and drives employment growth are “detached from reality”....

William Mitchell — Modern Monetary Theory

Austerity cultist Kenneth Rogoff continues to bore us with his broken record
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Yes, Banknotes Are A Central Bank Liability — Brian Romanchuk

David Bholat recently wrote “How to Modernise Central Bank Balance Sheets: No Notes.” It is partly in response to this article. The idea is that banknotes (“dollar bills”/”pound notes” etc. issued by the government should not be classified as a liability, rather as some form of capital or possibly taken off the balance sheet. I have run into variants of this idea in the past (the stronger version being that all forms of the monetary base are not liabilities), and the root idea is that “monetary issue is good for the economy, so how can it be a liability?” Such a redefinition or removal of banknotes is either misleading or wrong.

Bond Economics

Yes, Banknotes Are A Central Bank Liability

Brian Romanchuk

What Trump's Pick for Treasury Secretary Gets Right (and Wrong) about MMT — Stephanie Kelton

Scott Bessent is aware of MMT but he has a faulty understanding of what MMT says, Kelton argues. On the positive side, he is not clueless, like most others. For example, he gets that high rates are may be stimulative and low rates contractive, based on policy outcomes of the Bank of Japan.

The Lens
What Trump's Pick for Treasury Secretary Gets Right (and Wrong) about MMT
Stephanie Kelton | Professor of Public Policy and Economics at Stony Brook University, formerly Democrats' chief economist on the staff of the U.S. Senate Budget Committee, and an economic adviser to the 2016 presidential campaign of Senator Bernie Sanders

Money for beginners — Lars P. Syll

Plug for Randy Wray's popular-access book on basic MMT.

Lars P. Syll’s Blog
Money for beginners
Lars P. Syll | Professor, Malmo University

Rates

 

Why would you have your RRP rate above your min FFR target and then not understand why MMMFs won’t fully engage in Tsy markets?

How stupid are these f-ing people?

When Fed did RRP in the first place they created a competing risk free asset class to Tsy securities which was bad enough… but then set the rate higher than your min target?

#Fed officials are mulling a 5 bps cut to the reverse-repo rate to align it with the lower end of the federal funds target range. Nov meeting minutes highlight this as a "technical adjustment" to control the benchmark rate. RRP usage: $148.8B on Tue.#Fed #FOMC #Powell #inflation pic.twitter.com/QVDV6FlIMD

— Rymond_Inc (@rymondIncKenya) November 27, 2024

So what’s going to happen is these Art degree monetarist morons are going to cause an auction failure and then all the other Art degree debt doomsday morons are going to go running all around saying “ no one will loan the US any more money! … no one will loan the US any more money! … “

You watch…

How to Cut $2 Trillion in Federal Spending Without Breaking a Sweat Stephanie Kelton

As James Galbraith put it years ago, "It's the interest rate, stupid."

Nostalgia: Carlos "beowulf" Mucha liberally quoted. And no, not "the coin."

The Lens with Stephanie Kelton
How to Cut $2 Trillion in Federal Spending Without Breaking a Sweat
Stephanie Kelton | Professor of Public Policy and Economics at Stony Brook University, formerly Democrats' chief economist on the staff of the U.S. Senate Budget Committee, and an economic adviser to the 2016 presidential campaign of Senator Bernie Sanders

Tariffs As A Fiscal Tool? — Brian Romanchuk

Has Trump thought his tariff proposal through? Brian gives reasons to doubt that this move would be successful in replacing the income tax or substantially affecting it.

BTW, Brian has migrated from X to Bluesky along with many others in the fields of economics and finance. Links provided at the end of the post.

Bond Economics

Tariffs As A Fiscal Tool?

Brian Romanchuk

Class

 

Whoa!… hold up!…  was Marx correct? 🤔

Americans are increasingly voting along class lines, not racial ones. That could upend how we’ve thought about politics for decades. https://t.co/rWBJFK32BD

— The Wall Street Journal (@WSJ) November 15, 2024

Episode 8 (S2) of the Smith Family Manga is now available — Bill Mitchell

Today (November 15, 2024), MMTed releases Episode 8 in the Second Season of our Manga series – The Smith Family and their Adventures with Money. Have a bit of fun with it while learning Modern Monetary Theory….

William Mitchell — Modern Monetary Theory
Episode 8 (S2) of the Smith Family Manga is now available

Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Oh no...Eva Langoria leaving the U.S.!!!

Oh no, what will we do? "Privileged" (her words) Eva Langoria is leaving the U.S.!! What a loss.  Here's Eva, lamenting for all the rest of us who will be left behind.

“Most Americans” are “going to be stuck in this dystopian country, and my anxiety and sadness is for them."

Thank you, Eva, for your fake concern. We'll try to get by in this terrible country as best as possible. But before you go, can you please take all of your Hollywood asshole friends, too? America can't stand you and your privileged elitist sanctimonious jerks from Tinseltown. Get lost. Go!! 

Hopefully, this is not an empty threat by Eva, as we hear regularly from people like Alec Baldwin, Susan Sarandon, and Robert De Niro. They should take the lying, terrorist-loving, woke, anti-American mainstream media with them.

Wishful Thinking

 

More wishful thinking from Democrat left:

Given voters’ ire at the high cost of living, it might be wrong to assume Donald Trump will simply pick up where he left off and pressure the Fed to take interest rates right on down https://t.co/Mf70bunUQr

— Bloomberg Economics (@economics) November 12, 2024

Trump v Iran

 

Reports Iran conspired to assassinate Trump…

The DOJ charged 3 individuals in an assassination plot against Trump. Two are in custody and one is allegedly living in Tehran — the capital city of Iran.

Some really interesting things are happening right now. pic.twitter.com/8rsDBdyjGk

— johnny maga (@_johnnymaga) November 8, 2024

6 of these m-fers just deployed to Qatar plus boomers to the region…

Maybe Trump will demand the surrender of the Iranian regime…or finally incinerate that whole goat f-ing rats nest…

Volatility premiums increasing 2 months out…

Trump v Fed ?

 

This guy a MAGA Trump insider perhaps in line for AG (probably too much to hope he gets it 🙏🏻) but it’s revealing that he mentions the bankruptcy first…

Trump’s opponents attempted to bankrupt him for non-fraud.

And imprison him for life for non-crimes.

And take him off the ballot.

And take off his head.

Now they want “unity”?

Fuck them.

Let’s unify them in prison.

— 🇺🇸 Mike Davis 🇺🇸 (@mrddmia) November 8, 2024

Biden 2022 rate increases were unprecedented… so you can see what they did they put the rates way up to squeeze him, then they get commie kangaroos in NYC to impose half a billion dollars civil judgement in attempt to to bankrupt him…  flushing the US CRE market down the toilet bowl in the process causing mini banking crisis in March 2023 … hoping Trump somehow got caught up in the whirlpool…

So his first mission (he will never say that it is) will be to reverse all this ..  which would start with quick reversal of Biden rate rate increases to benefit his position and a lot of others like him who also have been being squeezed… which means policy rate down at least to 2% pronto.. will cover it politically by saying he’s getting mortgage rates down for young households which will be an added political benefit…

Going to be interesting to see if the Fed commie deep state Monetarists are going to be the first to fight him on this part of his agenda..,

Functional finance — Lars P. Syll

What monetarists. deficit hawks, and debt phobes don't get. Quotes by Abba Lerner and John Maynard Keynes.

Lars P. Syll’s Blog
Functional finance
Lars P. Syll | Professor, Malmo University

On Sraffa and Keynes — Lars P. Syll

Minsky quote that underlies not only Keynes but also MMT.

Lars P. Syll’s Blog
On Sraffa and Keynes
Lars P. Syll | Professor, Malmo University

Escobar: The Roadblocks Ahead For The Sovereign Harmonious Multi-Nodal World — Pepe Escobar

We will need weeks, months, years to fully grasp the enormity of what took place in Kazan during the annual BRICS summit under the Russian presidency.

For the moment let’s cherish arguably the most appropriate definition of BRICS as a laboratory of the future: this lab, against nearly insurmountable odds, is actively engaged in creating a Sovereign Harmonious Multi-Nodal World.

My take is that there were two tracks leading up to the meeting of BRICS+ in Kazan. 

The first track was widely reported in the Alt-Media and was wildly optimistic about the outcome since it focused almost exclusively on the "key players" none of whom had any political clout. It was even speculated that a new monetary system based on a BRICS+ currency would be announced. This turned out to be pie-in-the-sky.

The second track that was taking place behind the scenes and was not reported on or factored in by most of the Alt-Media. This group emerged into view immediately prior to Kazan as a meeting of the heads of the central banks of the the BRICS+ nations. This was a tip off that "the grown-ups" would be managing the proceeding and outcomes, which is what happened. 

The boat did not rock as many had anticipated.  It has now become clear that BRICS+ intends to work within the existing system to reform it rather than to revise it drastically or to shape a new system or to radically "de-dollarize."

In other words, practicality won the day rather than confrontation. Change is likely to be gradual rather than dramatic. The task at hand is to develop alternative means of settlement for international accounts that avoids sanctions and that is already taking place through binary agreements to settle in the currencies of the respective partners.

Pepe gives his take on it.

Zero Hedge
Escobar: The Roadblocks Ahead For The Sovereign Harmonious Multi-Nodal World

Pepe Escobar

Government job creation programs deliver significant (net) long-term benefits — Bill Mitchell

On April 5, 1933, US President Roosevelt made an executive decision to create the – Civilian Conservation Corps (CCC) – which was a component of the suite of government programs referred to as the – New Deal – that defined the Federal government’s solution to the mass unemployment that arose during the early years of the – Great Depression. These programs have been heavily criticised by the free market set as being unnecessary, wasteful and ineffective. Critics assert that no long-term benefits are forthcoming from such programs. However, those assertions are never backed by valid empirical evidence. A recent study by US academics has provided the first solid piece of evidence that the CCC delivered massive long-term benefits to the individuals who participated in it. And these benefits considerably outweigh the dollars outlaid by the government. I discuss that research today. The results also point to the effectiveness of a Job Guarantee program....

William Mitchell — Modern Monetary Theory

Government job creation programs deliver significant (net) long-term benefits
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

MMT — debunking the deficit — Lars P. Syll

Lars comments on a quote from Stephanie Kelton's The Deficit Myth showing the loanable funds theory being inconsistent with stock-flow accounting.

Lars P. Syll’s Blog
MMT — debunking the deficit
Lars P. Syll | Professor, Malmo University

24 per cent annual interest on time deposits: St Petersburg Travel Notes, installment three — Gilbert Doctorow

Not much happening regarding MMT these days.

Herer is an anecdotal report on Russian banking. And, yes, you read that right. You get 24% not the bank.

Doctorow is an American residing in Brussels who spends a good deal of time in Russia. His wife is Russian and he is fluent in Russian. A "Russianist," he has a a PhD in history (Harvard) and is a retired business person. His reporting does not conform to the narrative.

Gilbert Doctorow—International relations, Russian affairs
24 per cent annual interest on time deposits: St Petersburg Travel Notes, installment three

Gilbert Doctorow

Did The Latest BRICS Summit Achieve Anything Of Tangible Significance At All? — Andrew Korybko

The conclusion is that it’s a lot easier to talk about creating truly alternative institutions than actually doing so, which means that BRICS will likely just remain a talking club, or a “multitasking laboratory of global governance” as Kortunov diplomatically described it. That’s not to downplay the group’s role since it’s important for major and developing non-Western countries to discuss pressing issues of the evolving world order, especially economic-financial ones, but that’s not the same as what enthusiasts expected.

A dose of reality. The Alt-Media got a quite a bit ahead of reality with respect to their expectations of the initial outcome.

The Kazan Summit therefore wasn’t a failure, and in fact, it succeeded in its only realistic goal all along of gathering its members and partners together to discuss ways to voluntarily accelerate financial multipolarity processes such as through the increased use of national currencies. The outcome was always going to be more symbolic than tangible due to the group’s purely voluntary nature, though some observers had false expectations and thus feel bitter, but now they know what BRICS is really about.  

Andrew Korybko's Newsletter

Did The Latest BRICS Summit Achieve Anything Of Tangible Significance At All?
Andrew Korybko

Rate policy

 

Democrat rate policy still has US overnight risk free IOR rate at 4.9% so what is so bad about a 10yr risk free UST rate of 4.2%?  

It’s still significantly inverted over time …  usual Art degree moron suspects going apoplectic meanwhile a significantly inverted yield curve… hard to understand how these peoples brains work… 🤔

Pepe Escobar —Date With Destiny–BRICS Offers Hope in a Time of War

Pepe Escobar summarizes the state of play at the outset of the BRICS conference as it begans in Kazan, the capital of Tatarstan, Russian Federation. The heads of the central banks have already met in Moscow in preparation for discussing initial steps in an overhaul of the post WWII Bretton Woods monetary system and associated institutions established by and controlled by the West, the US in particular. Expectations had begun to exceed reality and now they are more modest but still positive.

Sputnik International
Pepe Escobar: Date With Destiny - BRICS Offers Hope in a Time of War

BRICS plans ‘multi-currency system’ to challenge US dollar dominance: Understanding Russia’s proposal — Ben Norton

The BRICS Cross-Border Payment Initiative (BCBPI) will use national currencies, instead of the US dollar. Russia’s finance ministry and central bank released a report detailing plans to transform the international monetary and financial system.

Geopolitical Economy

BRICS plans ‘multi-currency system’ to challenge US dollar dominance: Understanding Russia’s proposal
Ben Norton

BRICS—facts and figures — Peter Hanseler/Denis Dobrin

Introduction

In the first part of this year’s BRICS series, we described the geopolitical environment in which BRICS is currently operating and trying to evolve. This environment has changed for the worse since the last BRICS summit in South Africa last August.

The consequence is that BRICS cannot develop freely, because on the one hand, the decisions – especially those of the USA – regarding the wars in Ukraine and the Middle East, the situation in the financial markets and finally the elections in the USA will have serious consequences for the whole world. On the other hand, the decisions of the BRICS regarding the admission of new members and the introduction of a currency (unlikely) or a payment and settlement system (likely) will also have a major impact on the overall geopolitical situation.

This article deals with the facts and figures of the current state of this organization, the figures including candidates for admission (BRICS+) and an outlook with figures including interested countries (BRICS++). In a subsequent article, we will cover the topic of a new currency and a new payment and settlement system.

Voice from Russia — The trilingual blog about geopolitics and geoeconomics written by a Swiss living in Moscow
BRICS – facts and figures

Peter Hanseler/Denis Dobrin 

The Boy Who Cried Wolf About Government Debt —Yeva Nersisyan, L. Randall Wray

In a New York Times editorial, David Leonhardt recounts Aesop’s apocryphal story about the boy and the wolf, warning that while deficit hawks have so far been wrong, the growing government debt will eventually bite. He reports the economic plans of both presidential candidates would add to the debt that will soon exceed GDP and grow to 130 percent of annual output under a President Harris, or 140 percent with a Trump presidency.

The story of the boy and the wolf was a fable, although it was within the realm of possibility. The fable of the debt wolf is not. While there are real world wolves—Leonhardt mentions climate catastrophe and autocratic leaders, and the authors would add rising inequality and the concentration of economic and political power in the hands of billionaires.

Levy Economics Istitute
Policy Note 2024/1 | October 2024

The Boy Who Cried Wolf About Government Debt
Yeva Nersisyan, L. Randall Wray

Improvement Of The International Monetary And Financial System — The Ministry Of Finance Of The Russian Federation, Bank of Russia, Yakov and Partners

This is what will be presented at the upcoming BRICS + meeting. Download report at link below.

Description on X here. (It's nothing like the cheerleaders have been projecting.)

BRICS Chairmanship Research

Improvement Of The International Monetary And Financial System
The Ministry Of Finance Of The Russian Federation, Bank of Russia, Yakov and Partners

Episode 7 (S2) of the Smith Family Manga is now available–A revealing Zoom session — Bill Mitchell

Today (October 18, 2024), MMTed releases Episode 7 in the Second Season of our Manga series – The Smith Family and their Adventures with Money. Have a bit of fun with it while learning Modern Monetary Theory (MMT) and circulate it to those who you think will benefit.…

William Mitchell — Modern Monetary Theory

Episode 7 (S2) of the Smith Family Manga is now available – A revealing Zoom session
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

How Australian Monetary System Favours the Powerful — Denis Hay

MMT to the rescue (from neoliberalism). This applies similarly to other countries running under neoliberalism, which can be broadly characterized as policy formulation based on state capture by elites in a plutocracy masquerading as a democracy. 

Social Justice Australia
How Australian Monetary System Favours the Powerful
Denis Hay

LA Woman

Great breakdown of a great song (by The Doors) by these 2 Millennial black bros… never understood the song as a metaphor for the city of Los Angeles but yeah I get it now… makes it even better…

The Deficit, the National Debt, and why we don’t have to worry about them. — John Rudden

Short article on Stephanie Kelton's The Deficit Myth.

Daily Kos
The Deficit, the National Debt, and why we don’t have to worry about them.
John Rudden

Episode 6 of the Smith Family Manga (Season 2) is now available— Bill Mitchell

Today (October 3, 2024), MMTed releases Episode 6 in the Second Season of our Manga series – The Smith Family and their Adventures with Money. Have a bit of fun with it while learning Modern Monetary Theory (MMT) and circulate it to those who you think will benefit. Episode 6 was delayed by two weeks…

William Mitchell — Modern Monetary Theory
Episode 6 of the Smith Family Manga (Season 2) is now available
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Modern Monetary Theory film proves finding the cash isn't the problem — William Thomson

As we have been writing for over a year in this newsletter, the UK Government, as the issuer of the UK pound, can never run out of money. They can afford whatever is priced in pounds. There is never a problem finding the money. This leads to a natural and painful conclusion: Continuing austerity policies is a political choice....

The National (Scotland)

Modern Monetary Theory film proves finding the cash isn't the problem

William Thomson, Scotonomics founder

Class origins matter – but who are the agents of change? — Bill Mitchell

Not MMT or economics as such but it is interesting in that Bill is an MMT founder so his stance on economic sociology is relevant. 

There was an interesting article in the UK Guardian the other day September 26, 2024) – Take it from me (and Keir Starmer) – you should never pretend to be more working class than you are. I don’t usually agree with the journalist but this article made me reflect on a lot of things.…

 Aside:

The scrutiny arises because many of these “Labour people” appear to have accumulated wealth (real estate etc), have come from well-paid jobs and network with the elites in society.

For that they are referred to, in a pejorative way, as ‘champagne socialists’.

In the US, they (affected Democrats) are called "limousine liberals" and "latté liberals." A lot of the formerly faithful are fed up with this posturing, but even more so with the corruption that flows from it.

The way the system works is when a person from an ordinary background gains celebrity of whatever sort and can afford a more bountiful lifestyle, then they enter "the bubble." Gradually or swiftly, they lose touch with their humbler roots among "the little people" as characterized by former Sen. Allen Simpson. It's also very American to pretend to a humble background after achieving status when that is not the case. 

In the age of the Internet that hypocrisy is usually quickly exposed.

William Mitchell — Modern Monetary Theory 

Class origins matter – but who are the agents of change?
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

The ball is now in Finance Ministry's court, Chinese economists say — Zichen Wang

Apparently many influential Chinese economists are old-style Keynesians. There is no indication that they understand the basic principle of MMT —  a sovereign currency issuer that doesn't create financial obligation in currency it does not issue has a monopoly on its currency. 

This is especially important considering that China faces deflation rather than inflation.

It's up to the Finance Ministry now. 

Wikipedia:

The Ministry of Finance of the People's Republic of China (Chinese: 中华人民共和国财政部; pinyin: Zhōnghuá Rénmín Gònghéguó Cáizhèngbù) is the constituent department of the State Council of the People's Republic of China which administers macroeconomic policies and the annual budget. It also handles fiscal policy, economic regulations and government expenditure for the state.

The ministry also records and publishes annual macroeconomic data on China's economy. This includes information such as previous economic growth rates in China, central government debt and borrowing and many other indicators regarding the economy of mainland China.

The Ministry of Finance's remit is smaller than its counterparts in many other states. Macroeconomic management is primarily handled by the National Development and Reform Commission (NDRC). State-owned industries are the responsibility of the State-owned Assets Supervision and Administration Commission, and there are separate regulators for banking, insurance and securities. It also does not handle regulation of the money markets or interest rates. These, together with other aspects of monetary policy, are governed by the People's Bank of China (PBC), mainland China's central bank. The Ministry, NDRC and PBC are equal in status, with their political heads all sitting on the State Council.

Pekingnology - CCG
The ball is now in Finance Ministry's court, Chinese economists say
Zichen Wang | Research Fellow & Director for Int'l Comms at Center for China and Globalization (CCG), after 11 years at Xinhua News Agency. Founder & Editor: Pekingnology & The East is Read. Salzburg Global Fellow (2024-)

See also

Strategic Culture Foundation (sanctioned by the US Treasury Department)

Watching the China river flow

Pepe Escobar

How I came to MMT — Robert Cauneau

 The discovery of a monetary approach, which, in this case, not only relates to a field that I was not familiar with, but also constitutes a total challenge to my own knowledge of public finance management, which I have practiced throughout my career, is not something trivial. So I decided to tell my own story.

Interesting personal story.

MMT France
How I came to MMT
Robert Cauneau

The article is available in French here.

China shit market

 

Commies dilute their productive capital with unproductive commie bullshit = 0…

Here is a wild chart. The total return on Chinese stocks since 1993 is negative. In contrast, India is a 13-bagger. pic.twitter.com/SPvczZxkld

— Jeff Weniger (@JeffWeniger) September 20, 2024

The 20 EMU Member States are not currency issuers in the MMT sense — Bill Mitchell

For some years now (since the pandemic), I have been receiving E-mails from those interested in the Eurozone telling me that the analysis I presented in my 2015 book – Eurozone Dystopia: Groupthink and Denial on a Grand Scale (published May 2015) – was redundant because the European Commission and the ECB had embraced and was committed to Modern Monetary Theory (MMT) so there was no longer a basis for a critique along the lines I presented. I keep seeing that claim repeated and apparently it is being championed by MMT economists. While there are some MMTers who seem to think the original architecture of the Economic and Monetary Union has been ‘changed’ in such a way that the original constraints on Member States no longer apply, I think they have missed the point. They point to the fact that the ECB continues to control bond yield spreads across the EU through its bond-buying programs (yes) and that the Commission/Council relaxed the fiscal rules during the Pandemic (yes). But the bond-buying programs come with conditionality and the authorities have now ended the ‘general escape clause’ of the Stability and Growth Pact and are once again enforcing the Excessive Deficit procedure and imposing austerity on several Member States. The temporary relaxation of the SGP rules (via the general emergency clause) did not amount to a ‘change’ in the fiscal rules. Indeed, the EDP has been strengthened this year. The Member States still face credit risk on their debt, still use a foreign currency that is issued by the ECB and is beyond their legislative remit, and are still vulnerable to austerity impositions from the Commission and their technocrats. To compare that situation with a currency-issuing government such as the US or Japan or Australia, etc is to, in my view, commit the same sort of error that mainstream economists make when they say that ‘the UK is at risk of becoming like Greece’ or similar ridiculous threats to discipline fiscal authorities in currency-issuing nations.

There are various interrelated questions that bear on this subject....

    

William Mitchell — Modern Monetary Theory
The 20 EMU Member States are not currency issuers in the MMT sense
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

(II) Xu Gao's case for Beijing to spend — Yuxuan JIA and BU, Xiaoqing

Xu Gao, the Chief Economist and Assistant President of Bank of China International Co. Ltd., and an adjunct professor of the National School of Development (NSD) at Peking University, has been featured on The East is Read several times.

On August 19, 2024, Xu published a new essay on his personal WeChat blog 徐高经济观察 Xu Gao Economic Observation. This long essay, essentially making a case for Beijing to adopt stimulus measures, will be rolled out in three parts.

Amid cautious signals from the Chinese government and the widespread belief in saving policy "ammunition," Xu Gao calls for a shift to macroeconomic thinking. He contends the government shouldn't be tethered to the belief that money spent is money lost, as a company might. The government revenue isn't fixed or exhaustible but "endogenous," says he, driven by government spending, which boosts private income, consumption, and investment. Unlike individuals and businesses who see income as beyond their control, the government, following Keynesian principles, can step in when demand falters. By increasing fiscal spending and liquidity, it can generate demand where the private sector won't, matching purchasing power with the willingness to spend.

Xu argues that the real limit on stimulus isn't money supply—it's supply capacity. Rising inflation and trade deficits mean domestic supply can't keep up with demand, making further stimulus risky. But when inflation is low and there's a trade surplus, it signals excess supply, making stimulus "not only feasible but also essential."….

The East is Read
(II) Xu Gao's case for Beijing to spend: stimulus now doesn't hinder structural reforms-Chief Economist of Bank of China International continues with the sustainability and necessity of stimulus.

Yuxuan JIA and BU, Xiaoqing

Trump to roll out DeFi project this week

Looks like Trump going to start a crypto exchange and a USD stable coin… 🤔

.@WorldLibertyFi is helmed by @realdonaldtrump's sons, @EricTrump and @DonaldJTrumpJr and the 18-year-old Barron Trump is the project's "DeFi visionary.” https://t.co/PSKhQWyQKu

— CoinDesk (@CoinDesk) September 13, 2024

Xu Gao's case for stimulus—Chief Economist of Bank of China International tears apart the opposition — Yuxuan JIA and BU, Xiaoqing

 MMT without naming it.

Xu Gao, the Chief Economist and Assistant President of Bank of China International Co. Ltd., and an adjunct professor of the National School of Development (NSD) at Peking University, has been featured on The East is Read several times.

On August 19, 2024, Xu published a new essay on his personal WeChat blog 徐高经济观察 Xu Gao Economic Observation. This long essay, essentially making a case for Beijing to adopt stimulus measures, will be rolled out in three parts.

Amid cautious signals from the Chinese government and the widespread belief in saving policy "ammunition," Xu Gao calls for a shift to macroeconomic thinking. He contends the government shouldn't be tethered to the belief that money spent is money lost, as a company might. The government revenue isn't fixed or exhaustible but "endogenous," says he, driven by government spending, which boosts private income, consumption, and investment. Unlike individuals and businesses who see income as beyond their control, the government, following Keynesian principles, can step in when demand falters. By increasing fiscal spending and liquidity, it can generate demand where the private sector won't, matching purchasing power with the willingness to spend.

Xu argues that the real limit on stimulus isn't money supply—it's supply capacity. Rising inflation and trade deficits mean domestic supply can't keep up with demand, making further stimulus risky. But when inflation is low and there's a trade surplus, it signals excess supply, making stimulus "not only feasible but also essential."

The East is Read

Xu Gao's case for stimulus—Chief Economist of Bank of China International tears apart the opposition
Yuxuan JIA and BU, Xiaoqing

Wholesale Payments Systems and Bank Reserves — Brian Romanchuk

Some of the nity-gritty involving payments systems that underlies some institutional arrangement needed to understand MMT's analysis.

Bond Economics
Wholesale Payments Systems and Bank Reserves
Brian Romanchuk

The Myth That the US is Rapidly Approaching Bankruptcy — Michael Hudson

 Yves Smith's introduction

Yves here. It is frustrating to see a normally solid YouTuber almost go off the rails by getting outside his area of expertise, geopolitics, and fall for libertarian scaremongering. We’ve commented before on the tendency of certain schools of commentary to fall into belief clusters, so anti-globalists are anti-dollar hegemony (and often crypto fans) to the degree that they have not bothered understanding how a currency issuer like the US operates. A currency issuer can never suffer an involuntary bankruptcy. They can always create more currency. What they can do is generate too much demand compared to the real resources of their economy, as in inflation.

In the discussion below, Micael Hudson has spend [spends] a significant portion of the interview debunking US budget myths to Nima of Dailogue Works. Hudson not only got Nima to agree to a more accurate title but also Hudson starting by laying out MMT basics in his extended opening discussion. As Hudson said via e-mail:

Nima had a sensationalist title, “Is the US rapidly approaching bankruptcy.” I showed that this is a myth and the US can’t go bankrupt.

We pre-arranged that I would give a 25-minute lead-in discussing just whom the US Treasury debt is owed to, and why most of it has no intention of being paid (paper currency, debts to foreign central banks and to the US Fed), and as for debts to bondholders, US Treasury debt continues to be a flight to safety, not to risk...

Naked Capitalism
The Myth That the US is Rapidly Approaching Bankruptcy
Michael Hudson

Modern Monetary Theory: Economics for the 21st Century – MOOC – now available via MMTed.org — Bill Mitchell

I am travelling all day tomorrow so I am bringing forward the normal blog post to today. I am pleased to announce that from today the MMT MOOC which we ran through the University of Newcastle’s edX facility over the last few years is now available through MMTed on an on-going basis. Read on to get the full details and access. 

William Mitchell — Modern Monetary Theory
Modern Monetary Theory: Economics for the 21st Century – MOOC – now available via MMTed.org
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Trump 3% Mortgage Policy

 

Trump promising a return to 3% mortgages if he can get back in…

He’ll have to tell his Central Bank to lower the policy rate down to at least 2% to hope to get his 30-yr fixed back to 3%…

Donald Trump says his plans to slash regulations will get mortgage rates 'back down' to 3%, per FORTUNE

— unusual_whales (@unusual_whales) September 9, 2024

Episode 5 of the Smith Family Manga (Season 2) is now available – the Finance Report hots up Bill Mitchell

Today (September 6, 2024), MMTed releases Episode 5 in the Second Season of our Manga series – The Smith Family and their Adventures with Money. Have a bit of fun with it while learning Modern Monetary Theory (MMT) and circulate it to those who you think will benefit …

William Mitchell — Modern Monetary Theory

Episode 5 of the Smith Family Manga (Season 2) is now available – the Finance Report hots up
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Short term interest rate characteristics…

Some concern by Monetarists out there that current short term risk free rate of interest compared to the average of a past period of the short term risk free interest rate is a cause for serious concern wrt equity prices…

Think of financial asset prices as a function of the equation P = (A-L)/A where A and L are Depository system Assets and Liabilities…

At point 1 the fiscal surpluses were being saved in the TTL accounts at Depositories increasing system L by $100Bs … at point 2 the Fed increased Depository system A by hundreds of billions in September 2008, causing credit provision to cease and the GFC …. and at point 3 they again did the same thing as 2 establishing over $1 trillion of A in March 2020 causing the credit function to again cease until this regulatory function was suspended …. 

Today Treasury no longer utilizes TTL accounts and we are in large fiscal deficit anyway, and no where have I seen currently is the Fed proposing to increase A at this time rather their stated policy is to continue to gradually “normalize” system A at much lower levels…

“Correlation is not causation” etc… 

Some debriefing on continuous fiscal deficits and debt issuance — Bill Mitchell

A government cannot run continuous fiscal deficits! Yes it can. How? You need to understand what a deficit is and how it arises to answer that. But isn’t a fiscal surplus the norm that governments should aspire to? Why frame the question that way? Why not inquire into and understand that it is all about context? What do you mean, context? The situation is obvious, if it runs deficits it has to fund itself with debt, and that becomes dangerous, doesn’t it? It doesn’t ‘fund’ itself with debt and to think that means you don’t understand elemental characteristics of the currency that the governments issues as a monopoly. These claims about continuous deficits and debt financing are made regularly at various levels in society – at the family dinner table, during elections, in the media, and almost everywhere else where we discuss governments. Perhaps they are not articulated with finesse but they are constantly being rehearsed and the responses I provided above to them are mostly not understood and that means policy choices are distorted and often the worst policy decisions are taken. So, while I have written extensively about these matters in the past, I think it is time for a refresh – and the motivation was a conversation I had yesterday about another conversation that I don’t care to disclose. But it told me that there is still a lot of work to be done to even get MMT onto the starting line.... 

William Mitchell — Modern Monetary Theory
Some debriefing on continuous fiscal deficits and debt issuance

Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Austra…

Episode 4 of the Smith Family Manga (S2) is now available — Bill Mitchell

Today (August 23, 2024), MMTed releases Episode 4 in the Second Season of our Manga series – The Smith Family and their Adventures with Money. Have a bit of fun with it while learning Modern Monetary Theory (MMT) and circulate it to those who you think will benefit …

William Mitchell — Modern Monetary Theory

Episode 4 of the Smith Family Manga (S2) is now available
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Chartbook 310 The shock of the new: Dollar dominance and modern monetary macro in the 1920s. — Adam Tooze

Not MMT but relevant historically. How the world got here ((to dollar hegemony), as well as to monetarism, the accounting identity that is, as the basis of macro.  

Adam Tooze is a historian rather than an economist, so he is able to shine a different light on the subject.

Chartbook
Chartbook 310 The shock of the new: Dollar dominance and modern monetary macro in the 1920s.
Adam Tooze | Shelby Cullom Davis chair of History at Columbia University and serves as Director of the European Institute

NDX100 EPS

 

Something happened after the 2022 Biden unprecedented rate increases to really crush (-32%) the EPS of the NDX100… 🤔

With the implication that this one time discount after the unprecedented Biden rate increases in 2022 might be reversed if those said rate increases were to be reversed…

An Economic program for Kamala that will benefit everyone, and win the Presidency in November! — John Rudden

MMT.

Daily Kos
An Economic program for Kamala that will benefit everyone, and win the Presidency in November!
 John Rudden

Major macroeconomic policy reform is needed to reduce the reliance on monetary policy — Bill Mitchell

There is some commentary emerging that is finally starting to question the reliance on monetary policy (setting interest rates) as the primary macroeconomic policy tool with fiscal policy forced into a passive role. In Australia, this debate has intensified in the last week following the hubris from the new Reserve Bank governor, who thinks her role is to sound like a ‘tough guy’ dishing out threats of ever increasing interest rate rises even as inflation falls. There was an Op Ed in the Sydney Morning Herald today (August 12, 2024) – Maybe only a recession will fix macroeconomic management – by the Economics Editor Ross Gittins, which challenges the current macroeconomic consensus. Some of this argument is acceptable. But when he advances his alternative proposal of “a new independent authority” to set monetary and fiscal policy, the reality is that this would be as bad as we have now. More on that later....

William Mitchell — Modern Monetary Theory

Major macroeconomic policy reform is needed to reduce the reliance on monetary policy
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Episode 3 of the Smith Family Manga (S2) is now available — Bill Mitchell

Today (August 9, 2024), MMTed releases Episode 3 in the Second Season of our Manga series – The Smith Family and their Adventures with Money. Have a bit of fun with it while learning Modern Monetary Theory (MMT) and circulate it to those who you think will benefit …

William Mitchell — Modern Monetary Theory

Episode 3 of the Smith Family Manga (S2) is now available

Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

US labour force data provides no basis (yet) for recession panic — Bill Mitchell

The financial markets around the world have over the last week demonstrated, once again, that they are subject to wild swings in irrationality despite mainstream economists holding out the idea that these sorts of transactions exhibit pure rationality. Some of the capital movements are explained by a shift in the interest rate spread between Japan and the US as the former nation decided to increase interest rates modestly. That altered the profitability of financial assets in each currency and so there were margins to exploit. But the big seings came when the US Bureau of Labor Statistics (BLS) released their latest labour market data last Friday (August 2, 2024) – Employment Situation Summary – July 2024 – which showed payroll employment increasing by only 114,000 (well down on expectation) and the unemployment rate rising by 0.2 points to 4.3 per cent. Suddenly, the headlines were calling an imminent recession in the US and that triggered a flight into safer assets (government bonds) away from shares etc, which drove down bond yields (as bond prices rose) and left some short-run carnage in the share markets. A few days later the panic subsided and one has to ask what was it all about. In this blog post, I examine the labour force data and add some new extra ‘recession predictors’ to see whether the panic was justified. The conclusion is that it was not....

William Mitchell — Modern Monetary Theory

US labour force data provides no basis (yet) for recession panic
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

The Bank of England does not need a tiered reserve system for the Government to avoid austerity — Bill Mitchell

There is an interesting debate going on in the UK at present about the concept of tiered bank reserves. The concept is now being used by commentators to argue that the new British government does not need to inflict the austerity that the Chancellor has now announced (even though she is denying that is what the government is up to) because the government can simply reduce outlays to the commercial banks in order to meet the fiscal rules. The discussion is rather asinine really and features all the missteps that commentators make when trying to appear progressive but falling into the usual mainstream macroeconomic fictions....

William Mitchell — Modern Monetary Theory
The Bank of England does not need a tiered reserve system for the Government to avoid austerity
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Trump: No tax on tips, no tax on Social Security

If he can get back in, would be substantial fiscal stimulus… Trump at least talking about economic proposals Dems just talking about all the transgender and climate nutter stuff while prices for real items remain elevated, unemployment rate keeps rising and rate of job creation keeps falling…

Trump telling Powell at the Fed not to modify the policy rate before the election if he wants to finish his term if Trump gets back in…. Prediction markets now 100% probability of a cut in September so looks like Fed is going to reduce the rate before the election…

Trump will then claim “election interference!” and will probably then get in front of it by promising to fire Powell on day one and guarantee a new Fed chairman who will immediately lower the policy rate to a point where the 30-year mortgage rate immediately goes back to 3% where it was when he left…

So Trump proposals will be: no tax on tips, no tax on Social Security, and a return to the 3% 30-year mortgage rate…

British Chancellor fails the basic test – language is meant to impart meaning — Bill Mitchell

Language is meant to bring meaning to discourse. That means we want to use terms that convey information that is of use to us in making our way in the world. The problem is that economists have perverted that process and introduced a metaphorical language that is intended to persuade the reader/listener to accept a particular view of the world but which undermines their ability to actually understand the phenomenon in question. Marx knew long ago how language could be constructed to advance the interests of the ruling class. The mainstream economics commentary that is also used by politicians falls into this category. Terms are used that have no meaning in an elemental sense but provide support for ideological agendas. We, the public, allow that to happen because we are ignorant about the context. It becomes a vicious cycle of lies and fictions which undermine human and environmental sustainability but certainly transfer income to the top-end-of-town. A recent path setting address to the House of Commons by the new Chancellor is a classic example of this reality denial....

William Mitchell — Modern Monetary Theory
British Chancellor fails the basic test – language is meant to impart meaning
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Trump Embraces the “Bitcoin-Dollar”, Stablecoins to Entrench US Financial Hegemony — Whitney Webb

Where all this may be going is anyone's guess. Wherever, it looks like down the rabbit hole. The UK is "broke." The USD is being crushed under "a mountain of debt." De-dollarization is "in full swing."

The Alternative World
Trump Embraces the “Bitcoin-Dollar”, Stablecoins to Entrench US Financial Hegemony
Whitney Webb

MMT and international trade–some further considerations in a degrowth context— Bill Mitchell

One of the undercurrents at the recent UK MMT Conference in Leeds was the apparent unwillingness of MMT economists to acknowledge their mistake in dealing with international trade. In our new book – Modern Monetary Theory: Bill and Warren’s Excellent Adventure (published July 2024) – we devote a chapter to this issue. There are various strands to the criticisms we receive ranging from claims we are simply wrong at the most elemental level to others claiming trade has no part in the MMT framework. All miss the point and I am surprised people have tried to make a ‘career’ (or advance their egos) on this issue. As I have noted several times in the past, the issue is nuanced but the elementary facts are not. I am now working on a section for my new book (with Dr Louisa Connors) on ‘degrowth’ and system viability from an MMT perspective and so I am linking the trade aspects of MMT with this narrative to provide further clarification of how nuanced this area of discussion can be. Here is a little glimpse of that work....

William Mitchell — Modern Monetary Theory

MMT and international trade – some further considerations in a degrowth context
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Episode 2 of the second season of our Manga – The Smith Family and their Adventures with Money — Bill Mitchell

 Today (July 26, 2024), MMTed releases Episode 2 in the second season of our Manga series – The Smith Family and their Adventures with Money. Have a bit of fun with it while learning Modern Monetary Theory (MMT) and circulate it to those who you think will benefit …

William Mitchell — Modern Monetary Theory
Episode 2 of the second season of our Manga – The Smith Family and their Adventures with Money – available now
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

In the latest episode of our Of Interest podcast, Steven Hail gives the MMT perspective on the monetary system, inflation, climate change & more — Gareth Vaughan

Audio and summary of talk.

interest.co.nz
In the latest episode of our Of Interest podcast, Steven Hail gives the MMT perspective on the monetary system, inflation, climate change & more
Gareth Vaughan

Currency Hierarchy — Eric Tymoigne

In Stabilizing and Unstable Economy, Minsky noted that “[a]n economy has a number of different types of money: everyone can create money; the problem is to get it accepted” (p. 228). While governments and banks usually get the spotlight, tens of thousands of monetary instruments have been issued by localities, ecclesiastic domains, local seigneurs, taverns and other private agents in many periods of monetary history, worldwide, up to the present [see Burn (1853); von Glahn (1996); Fletcher (2003); Blanc (2017)]. All these instruments are part of a “hierarchy of money” (Bell, 2001), “debt pyramid” (Olivecrona, 1957), “pyramid of credit” (Murad, 1954), or “scale of credit” (Wilson, 1811); a concept used to categorize the variety of monetary instruments available in a given area common to all of them, and the extent of the operation of a payment system and its integration within other, usually broader, payment systems. While the given common area is often the domestic economy, the international scale can also be considered (see de Conti et al., 2013; Palludeto and Abouchedid, 2016).

Monetary Policy Institute Blog #148

Currency Hierarchy
Eric Tymoigne, MMT economist
Associate Professor of Economics at Lewis & Clark College
Research Associate at the Levy Economics Institute of Bard College

UK MMT Conference 2024 – Slides available for download

Download PDF's of slide sets from the presentations at the recent UK MMT conference.

The Gower Initiative for Modern Money Studies
UK MMT Conference 2024 – Slides

See also

The National (Scotland)
Scotland needs its own currency ASAP after indy, say top economists

Scotonomics

MMT’s Leeds conference and disinvitations — Richard Murphy

For the record. Trouble in MMT-land.

Funding the Future
MMT’s Leeds conference and disinvitations

Funding the Future (formerly Tax Research UK)

Richard Murphy, Tax Research LLP

The Bank for International Settlements (BIS) as ideological fortress for monetary technocrats — Vadym Syrota

 Not MMT per se, but it explains something of the tenacious hold that neoliberalism has on economic and monetary policy owing to the Bank of International Settlements ((BIS).

Monetary Policy Institute Blog #146
The Bank for International Settlements (BIS) as ideological fortress for monetary technocrats
Vadym Syrota, Ph.D. in economics, independent banking expert, contributor to the specialized blog of the Kennan Institute Woodrow Wilson Center (USA)

See also

The development of BRICS and its expansion in the Global South speaks to this issue internationally. In this view, it is not possible to reform the existing system. Another system this is based on different assumptions needs to be developed instead.The failure of heterodox approaches to reform or replace neoclassical economics also argues for this.

Developing Economics — A CRITICAL PERSPECTIVE ON DEVELOPMENT ECONOMICS

Is It Possible to ‘Decolonize’ Economics?*

Eiman Zein-Elabdin | Professor of Economics at Franklin & Marshall College, USA

Season 2 of our Manga – The Smith Family and their Adventures with Money — Bill Mitchell

Today (July 12, 2024), MMTed releases Episode 1 in the Second Season of our Manga series – The Smith Family and their Adventures with Money. We have spent the last several months developing the storylines and graphics and Season 2 will run from today to December 6, 2024 with episodes appearing on a fortnightly basis.

Have a bit of fun with it while learning Modern Monetary Theory (MMT) and circulate it to those who you think will benefit …

William Mitchell — Modern Monetary Theory

Season 2 of our Manga – The Smith Family and their Adventures with Money – available now
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Thinking back 50 years to Nixon's resignation.

Thinking back to President Nixon's resignation in 1974 due to the Watergate scandal, it almost seems juvenile by today's level of scandals. Nevertheless, Nixon resigned. (He would have been impeached by the Senate anyway, most likely.)

Now we have a geriatric, senile old man who can't find his way off a stage or put intelligible sentences together and who is under pressure from his own party but won't step down for the good of the country. The total collapse of integrity and accountability from 50 years ago. No surprise.

Today, we lack leaders like Nixon. None of the current figures would make the same decision he did, especially for an issue that would be considered minor by today's standards.

Warren Mosler Says US Is Spending Too Much — Bloomberg

Bloomberg
Odd Lots Podcast: Warren Mosler Says US Is Spending Too Much

MAEIL BUSINESS NEWSPAPER Korea's No. 1 Economic Media

Warren Mosler warns of snowball U.S. fiscal deficit "There's no guarantee that high interest rates will bring down inflation".

Yoon Wan Sup

Machine Translation

Modern Monetary Theory: Bill and Warren’s Excellent Adventure (video)–Promo — Bill Mitchell

Here is a short video about our new book – Modern Monetary Theory: Bill and Warren’s Excellent Adventure – which will be published on July 15, 2024.

William Mitchell — Modern Monetary Theory
Modern Monetary Theory: Bill and Warren’s Excellent Adventure – Promo
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Atlanta Fed reduces Q2 GDP forecast once again, as I said they would

 Back in April, the Atlanta Fed's first GDP forecast for Q2 was 4.2%. I said that was ridiculous based on the year-over-year drop in net government transfers. I said they would have to revise that lower, probably equal to Q1 GDP of 1.6% if that. And sure enough, they did...FIVE TIMES, until they got it down to 1.5%-1.6%.

Then, because of one strong retail sales report in May, they boosted it back up to 3.2%. Once again, I said they'd have to bring that down because the year-over-year drop in net government transfers had gotten worse. And sure enough, they did. Now they have it at 2.1%, which probably has to decrease even more.

I don't know what their model is, but mine is very simple, more accurate, and timely. Net government transfers are the first derivative of all economic activity.

Dems warn Trump could “stoke inflation!”…

 

Dems doubling down on their current moron monetarist thesis that a plurality of voters will prefer the current regressive high interest rate policy over some other less regressive Trump fiscal/monetary policy…

Sixteen of the world's most notable economists — all Nobel Prize winners — are warning that former President Donald Trump could stoke inflation if he wins the presidency in November and moves forward with his economic plans. https://t.co/JRbXTuje2F

— CBS News (@CBSNews) June 26, 2024

Watch this Movie — Bethesda 1971

The Daily Kos is influential "on the left." This is good review of "Finding the Money" and hopefully it will wake more folks up to the fact that affordability is not the issue but rather the availability of real resources.

Daily Kos
Watch this Movie
Bethesda 1971

Everything you want to know about MMT — Lars P. Syll

One of the positive contributions of MMT, especially from a European point of view, is that it makes it transparently clear why the euro-experiment has been such a monumental disaster. The neoliberal dream of having over-national currencies just doesn’t fit well with reality. When an economy is in a crisis, it must be possible for the state to manage and spend its own money to stabilize the economy.

Lars P. Syll’s Blog

Everything you want to know about MMT
Lars P. Syll | Professor, Malmo University

Print Money in Structured Manner to Plug Deficit Instead of Raising Taxes, Economist Tony Mwiti Advises Kenyan President William Ruto — Muyela Roberto

MMT without naming it.

Tuko (Kenya)
Print Money in Structured Manner to Plug Deficit Instead of Raising Taxes, Economist Tony Mwiti Advises Kenyan President William Ruto
Muyela Roberto

Trump floats concept of eliminating the income tax and replacing it with tariffs

 

Even libertarian douchebag and alleged STEM degree Massie on board….  Would need a big GOP sweep to get it passed….

I guess the tax elimination is going to over ride the debt doomsday thesis of these libertarian morons in their pea brains….  Hard to understand how their brains work….

I’d  take it…  we could get rid of the tax but they would still be stupid…

Can’t have everything…

👍

Most intriguing policy idea from the GOP meeting at the Capitol Hill Club this morning:

Trump briefly floated the concept of eliminating the income tax and replacing it with tariffs. 🧐 pic.twitter.com/hw0k8gwlGa

— Thomas Massie (@RepThomasMassie) June 13, 2024

IMF: Dollar’s "stealth erosion" in global reserves by other currencies—Serkan Arslanalp, Barry Eichengreen, Chima Simpson-Bell

Taking a longer view, over the last two decades, the fact that the value of the US dollar has been broadly unchanged, while the US dollar’s share of global reserves has declined, indicates that central banks have indeed been shifting gradually away from the dollar.

BNE
IMF: Dollar’s "stealth erosion" in global reserves by other currencies

Serkan Arslanalp for the IMF, Barry Eichengreen, Chima Simpson-Bell

MMT — the key insights — Lars P. Syll

As has become abundantly clear during the last couple of years, it is obvious that most mainstream economists seem to think that Modern Monetary Theory is something new that some wild heterodox economic cranks have come up with. That is actually very telling about the total lack of knowledge of their own discipline’s history these modern mainstream guys like Summers, Rogoff and Krugman have.

New? Cranks? Reading one of the founders of neoclassical economics, Knut Wicksell, and what he wrote in 1898 on ‘pure credit systems’ in Interest and Prices (Geldzins und Güterpreise) soon makes the delusion go away….

Lars P. Syll’s Blog

MMT — the key insights
Lars P. Syll | Professor, Malmo University

Senior mainstream economist now admits central banks are not as independent as many believe — Bill Mitchell

The UK Guardian published quite an odd article the other day (May 30, 2024) by Mr GFC Spreadsheet Fudge Man Kenneth Rogoff – Why policymakers are more likely to risk high inflation during periods of economic uncertainty – which essentially claims that economic policy has been conducted for several years by institutions that do not meet the essential requirements that are specified by the mainstream New Keynesian macroeconomic approach, upon which the institutions have claimed justification. If that makes sense. He now claims that the eulogised principle of ‘central bank independence’, which is a mainstay of the New Keynesian justification that macroeconomic counter stabilisation policy should be left to monetary authorities and that fiscal policy should play a supporting but passive role, no longer exists as policy makers have had to come to terms with multiple crises. Of course from an Modern Monetary Theory (MMT) perspective such independence never existed and was just a ploy to allow the governments to depoliticise economic policy making and thus distance themselves, politically, from the fall out of unpopular policy interventions. If it wasn’t the IMF to blame, then it was the ‘independent’ central bank for austerity and interest rate hikes and all the rest of it. Now we have a senior Harvard professor admitting it was a ruse and bemoaning the fact....

William Mitchell — Modern Monetary Theory

Senior mainstream economist now admits central banks are not as independent as many believe
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW,

See also

Lars P. Syll’s Blog
The deficit myth
Lars P. Syll | Professor, Malmo University

Odd posts from Warren Mosler claiming "crowding out."

Investment boom, crowding out consumption.

— Warren B. Mosler (@wbmosler) May 31, 2024

Odd "X" posts from Warren Mosler recently talking about "crowding out." He says business investment is "crowding out" personal consumption. This is an odd claim because crowding out is not a condition that would be claimed under MMT understanding, where money is a function of demand and where there is no theoretical limit to its creation. (Under a free-floating FX regime.)

If business spending rises and personal consumption falls, so what? All that is, is a shift in the cohort doing the net spending. The economy may look a little different (factories getting built rather than expenditure on consumer goods, leisure, etc), but why is that a concern and how does he conclude, necessarily, that this is the reason for an economic slowdown?

It's wrong and it misses the main point which is the fact that the slowdown in the economy is coming from a decline in net government transfers (i.e. the "deficit") because "reverse stabilizers" are kicking in. (Tax deposits are rising faster than Treasury withdrawals.)

He ought to know this. 

In Defense Of Deficits — Steven Desmyter

I invited Stephanie Kelton to speak at our Man Alternative Investment Symposium in Oxford in 2021. Kelton was Bernie Sanders’s economic advisor and a leading proponent of Modern Monetary Theory (MMT), a neo-Keynesian movement that asserts that there ought to be no theoretical limit to a country’s ability to borrow, providing that it is in control of its own currency. Kelton and Sanders were near-perfect exemplars of the kind of “fiscal irresponsibility” (as their opponents would see it) that Conservatives (and, indeed, conservatives) like to hold out as a warning. Joe Biden, resolutely of the center, friend to the markets and the banks, was able to position himself as a far more rational and responsible alternative....

Forbes
In Defense Of Deficits
Steven Desmyter, President of Man Group

Government debt fears – more fiction from the mainstream media — Bill Mitchell

After all these years of trying, the insights provided by Modern Monetary Theory (MMT) still haven’t cut through. One doesn’t even need to accept the complete box of MMT knowledge to know that, at least, some of it must be factual. For example, how much brainpower does a person need to realise that a government that issues its own currency surely doesn’t need to call on the users of that currency in order to spend that currency? Even if we could get that simple truth to be more widely understood it would change things. But every day, economists and journalists, that just give platforms to the economists write and say things that demonstrate even that simple understanding of the monetary system fails them. Are they stupid? Some. Are they venal? Some. What other reason is there for continuing to use major media platforms, which give the author a massive privilege in terms of influence and reach, to pump out fiction masquerading as informed economic commentary? And the gullibility and wilful indifference of the readerships just extends the licence of these liars. Some days I think I should just hang out down the beach and forget all of it....

William Mitchell — Modern Monetary Theory
Government debt fears – more fiction from the mainstream media
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

MAGA: The Biden Admin Has Had Zero Coordination Between Fiscal and Monetary Policy

Current MAGA thesis… “inflation!”…  “deficit too high!”… “the dollar is going down!”…  same shit as always…. if Trump gets back in he’s going to have a lot of trouble with these Art Degree morons on his right flank…