Nobody needs reserves

Stablecoins increasingly replacing reserves for settlements… lol nobody needs any… RRR still 0% …  btw MMT silent on this technological development …  will allow Fed to continue to do their QT system reserve asset balance reduction ie  “destroying  money!”  more than most people realize…  they could probably go to zero reserves …  monetarist brain dead zombies will think  “no money!” …  monetarist morons will be all bearish on their “M1!” or “M2!” gong to zero…  

…

NY FED RECEIVES NO BIDS AT OVERNIGHT REPO OPERATION

— First Squawk (@FirstSquawk) September 2, 2025

The Economy of Narratives-How We Become the Guardians of Our Own Ideological Prison — Robert Cauneau

Why is it that visibly false economic analogies, such as that of the state managing its budget « as a responsible father, » dominate public debate with such unwavering force? How can we explain that the anxiety-inducing narrative of the « wall of debt » or the « burden on future generations » continues to justify austerity policies, even though detailed operational analyses, describing the system’s actual « plumbing, » demonstrate its inadequacy? The paradox is not so much that misconceptions persist despite the facts, but that they impose themselves as organized narratives, conveying emotion, legitimacy, and power. These narratives are not intellectual accidents, but cognitive and political instruments, shaped to be believed and to make alternatives unthinkable.

This article advances a simple thesis: the battle for a better understanding of economics is not simply a battle of facts against errors, but a battle of narratives. Technical reality, however rigorous and demonstrable, struggles to assert itself because it clashes with a dominant narrative that is much older, simpler, and, above all, more emotionally powerful. The main challenge for approaches like Modern Monetary Theory (MMT) is not to prove its technical coherence—it is—but to overcome its own narrative deficit.

This accounts for the persistence of the "fable" of monetarists that underpins the Fed's rationale for interest rates as the single variable "control knob" of the economy, despite not only the lack of evidence but also the admission that there is no justifiable theory of inflation based on the historical data in the present narrative.

MMT France

The Economy of Narratives-How We Become the Guardians of Our Own Ideological Prison
Robert Cauneau

The dollar system in an age of market-based finance - financial globalization beyond banks — Adam Tooze

How, after the GFC, the dollar is of key importance in global finance owing to the role of US Treasuries as a safe, high-liquidity asset.

Chartbook
Chartbook 401: The dollar system in an age of market-based finance - financial globalization beyond banks (The World Economy Now, July 2025)
Adam Tooze, Shelby Cullom Davis chair of History at Columbia University and Director of the European Institute

Grok on “money!”

 

Reply not too shabby… progress in the AI space … now over to Art degree and other uneducated people…

No, the USA isn't "out of money." As of July 2025, national debt is ~$36.6T, with a FY2025 deficit projected at $1.9T (6.2% GDP). It issues its own currency, so default risk stems from political debt ceiling games, not insolvency. Risk of shortfall by August if unresolved.…

— Grok (@grok) July 27, 2025

Michael Hudson: The Economics of a Civilizational Conflict (Transcript)

Full transcript of world-renowned classical economist Prof. Michael Hudson in conversation with Norwegian writer and political activist Prof. Glenn Diesen on “The Economics of a Civilizational Conflict”, July 17, 2025.

Historical backgrounder. It focuses on the history of economic rent — financial rent,  and its implications for the changing world order. The world order is now based on the transition of the West from industrial capitalism to financial capitalism, and the corresponding rise of China as the dominant industrial nation.

The subtext is that the solution involves replacing privately created finance with sovereign funds for public purpose, as MMT economists and proponents also advise. This requires reversing the current order that is based on neoliberalism by recognizing public goods and the ability of monetary sovereigns to provide for them as the currency issuer.

This post also encapsulates what Michael Hudson has been saying in most of his books and interviews.

Hudson self-identifies as a classical economist, a school that focuses on addressing economic rent extraction. The principal exponents of classical economics include Adam Smith, Jean-Baptiste Say, David Ricardo, Thomas Robert Malthus, and John Stuart Mill. Ricardo is remembered especially for his focus on economic rent. Marx wrote in response to classical economics, among others. Husdon is also a neo-Marxist in the sense that he adapts some of Marx's analysis without the dogmatism of the Marxist schools.

The Singu Post

Michael Hudson: The Economics of a Civilizational Conflict (Transcript)

Pressure on Powell

 

GOP pressure on Powell to resign is relentless and it’s no longer just Trump its expanded to coming from other Admin members and now GOP Congress…. Powell not looking well… ashen coloring.. very thin...

Jay Powell just can’t do the job. He was too late raising rates when Democrats set the economy on fire, refuses to cut rates now that it might help Trump, and may have even lied to Congress about the $3.1bn Taj Mahal he’s building at the Fed.

Time to go. pic.twitter.com/AFc5tp3d9a

— Bernie Moreno (@berniemoreno) July 25, 2025

Someone Is Closely Front-Running Trump's Trade Announcements — Thomas Neuburger

Was someone leaking his information? The timing looks suspicious.

God's Spies
Someone Is Closely Front-Running Trump's Trade Announcements

Thomas Neuburger

Eric Idle: "I'd be proud to be thrown out of America"

Former Monty Python star and bonehead, Eric Idle, says he'd be proud to be thrown out of America. Is he here? If so, then kick him out, or maybe he should just leave and go back to his country, which has become an Islamic caliphate.

Do you see what's going on in Europe?

Europeans think they're so special and enlightened. I lived in Europe for 10 years. I know what it is. Get out if you don't like it here.

MMT: Heuristics versus Paradigm Shift? — Randy Wray

Randy Wray, one of the co-founders, critiques the current way of presenting MMT and finds it wanting. He suggests a path to a more realistic one. 

Randy's presentation of MMT was previously somewhat different from the most prevalent one, owing, for example, to his featuring of Hyman Minsky, under whom he studied. This is a much more radical and thorough break with the "old school" method of presentation.

It's a big step forward but still lacks inclusion of economic sociology, which emphasizes class as the basis of power asymmetry.

This piece is important for all interested in MMT. It's relatively short, longer than a blog post but shorter than an article. To stay current it is a must-read. Hopefully, it will provoke discussion in the MMT community.

Levy Economics Institute of Bard College
MMT: Heuristics versus Paradigm Shift?
L. Randall Wray | Professor of Economics, Bard College

A (belated) Look at Finding the Money —Steve D. Grumbine

Other than Bill Mitchell, MMT economists largely pass over the implications of MMT for social, political and economic reform, all of which are connected at the foundation. Steve Grumbine argues that without class analysis, the job is incomplete. The problem is not with the superstructure but the foundation.

Real Progressives
A (belated) Look at Finding the Money
Steve D. Grumbine

MMT and Post-Keynesian Economics: A New Paper on Ontological Differences— NeilW

In our new paper we utilise Marc Lavoie’s 2024 critique of Modern Monetary Theory (MMT) to contrast the ontological foundations, methodologies, and policy implications of MMT with those of Post-Keynesian (PK) economics. We argue that disagreements between these schools reflect fundamental ontological divergences rather than technical nuances.

New Wayland Blog
MMT and Post-Keynesian Economics: A New Paper on Ontological Differences—
Comparing Post-Keynesianism and Modern Monetary Theory: The Importance of Ontology and Sociology, Phil Armstrong and Neil Wilson
NeilW

“Debt Ceiling!” increased by $5T

 

Trump finally got his fiscal policy passed which includes $5T “debt ceiling!” increase which btw liberal Democrats shitting all over…

The One Big Beautiful Bill hikes the U.S. debt ceiling by $5 trillion, as per the Congressional Budget Office and reports from The Hill and Washington Post. This accompanies $3.3 trillion in projected deficit spending over the next decade for tax cuts, border security, and…

— Grok (@grok) July 4, 2025

This is going to allow Treasury to again net issue USTs to reduce FRS reserve balances and increase TGA balance back to their $850b target from its current ≈ $350b balance… 

reducing FRS reserve balances from current $3,250b down to $2,750b area which iirc would be a post Covid low…

Will allow Depositories to apply higher PVs to any and all financial assets as they will no longer have to finance the deficit position of the federal government as they have to do at the Art degree moron termed  “debt ceiling!” …. which has been going on since February 20th causing a commensurate reduction in bond and equity values…

Mike epic rant

 

This from Mke years ago but 100% still in play… 100%  still in play… maybe Trump at best delaying it.,,

MMT Art degree morons: you have got Nooooooooo-where in all of these years …. Noooooooooo-where…  proceed according…

Trump should have allowed Israel to kill the fucking Ayatollah

Iran issues fatwa against Donald Trump: "Enemy of God"

Why did Trump let this piece of shit murderous cocksucker live? I have no idea. Israel could have taken him out, but Trump said no. Big mistake.

Sniper kills firefighters! Inexcusable, cowardly, disgusting act of violence.

Who kills firefighters? Our true heroes are there to protect lives and property. Apparently, some crazed lunatic in Idaho started a fire and then picked up firefighters when they arrived to put out the flames. 

What a disgusting, cowardly act of violence. Firefighters. No firefighter should ever have to face something like this.

My father was a firefighter with the FDNY. He was a hero who saved lives. This act of violence is truly disgusting.

Thoughts and prayers out to the families of the two fallen heroes.

Beyond Solvency — Warwick Powell

MMT-based.

Warwick Powell's Substack
Beyond Solvency
Warwick Powell | Adjunct Professor at Queensland University of Technology and a Senior Fellow at Taihe Institute, Beijing. He is the author of "China, Trust and Digital Supply Chains". "Dynamics of a Zero Trust World".

Functional Equation

 

The interest rate is in the denominator…

Plan accordingly…

SLR Review

Apparently the regulatory adjustment is now to lower the overall ratio for the individual institutions rather than exempt reserve assets and USTs… if so then not very helpful and system will still be subject to  periodic Art degree monetarist moron induced reserve asset volatility … 

Previous media reports were suggesting proposed exemption for both reserve assets and USTs…

Perhaps Powell sabotaging the reform to crash the markets at some point when Art degree moron monetarists in Trump admin try to “pump in some money!” under an attempted QE type of  stimmie… 

Disappointing… 🫩

https://x.com/grok/status/1935165702970949927

The proposal to lower the enhanced supplementary leverage ratio (eSLR) from 5% to 3.5%-4.5% was submitted for review on June 6, 2025. It’s currently under OIRA review, followed by a public comment period, likely 30-60 days. Implementation is expected later in 2025 or early 2026,…

— Grok (@grok) June 18, 2025

Rethinking Russia's War Chest — NeilW

A recent BBC headline, “How the West is helping Russia to fund its war on Ukraine,” published on May 30, 2025, presents a familiar narrative: Russia, reportedly awash in foreign currency from its fossil fuel sales, is using these “Western billions” to bankroll its ongoing war. The article starkly points out that “Ukraine’s Western allies have paid Russia more for its hydrocarbons than they have given Ukraine in aid,” highlighting a staggering €883bn earned by Russia since February 2022, despite sanctions.

While the sheer scale of these export revenues is undeniably jarring, and the moral implications of such purchases are deeply unsettling, the BBC’s analysis of Russia’s war funding misses a crucial economic point. The narrative that Russia needs these euros and dollars to pay its soldiers, forge tanks, or churn out shells for military use oversimplifies the fundamental realities of sovereign currency.

New Wayland

Rethinking Russia's War Chest

NeilW

Bessent: could change SLR over summer

 Significant in helpful way:

See here entire US banking system added about $500B loans and lease Assets in over an entire year:

While Treasury added $550B of reserve assets in just a few weeks starting February 20th this year reducing TGA from $850B to $300B at the morons “debt ceiling!” … causing a corresponding precipitous drop in all other financial asset prices as Depositories don’t have the regulatory capital to comply with leverage regulations in these situations where the second rate Art degree monetarist morons think they literally “inject money!” like this:

Policy discussion around the SLR reform has previously addressed only these reserve assets at the Depositories but lately the discussions have expanded to also include USTs …. 🤔

This could be related to the advent of USD stablecoins and the threat these coins pose to traditional Depository businesses… we have to see how this part works out..

The important part is getting the reserve asset exemption … this will eliminate the effect of what has been the most destabilizing Art degree monetarist moron monetary policies in our lifetimes..

Trump stablecoin off and running

Trumps USD1 now up to $2.2B issued in just a couple of weeks on an exchange… at the Fed’s current screw Trump 4.40% risk free rate he’s already making $88M annual rate … if he can get issuance up to $100B then he’s grossing >$4B annual which would probably be his most valuable enterprise … iirc Tether is at >$160B…

With the Art degree “money pumping!” Fed morons obviously trying to screw him (and with him all US borrowers) with their current unprecedented high risk free rate he’s now able to take advantage of that via his stablecoin…

So with the higher rates he makes bazillions in his stablecoin while if they lower rates he’ll make bazillions in his CRE and DJT shares…

BULLISH: Trump-backed $USD1 has skyrocketed to a $2.2B market cap in just 2 months, now the 7th-largest stablecoin globally.

Politics meets stablecoin adoption, fast.#USD1 #Stablecoins #Trump pic.twitter.com/7RaXbEfwpX

— Bitcoin Magazine NL (@BitcoinMagNL) May 8, 2025

US National Accounts – growth contracts but likely to be temporary — Bill Mitchell

 People are closely watching the US data at present to see what the impacts of the recent tariff decisions by the new US President might have. I am no exception. Yesterday (April 30, 2025), the US Bureau of Economic Analysis published the latest US National Accounts figures – Gross Domestic Product, 1st Quarter 2025 (Advance Estimate) – which provides us with the first major data release since the new regime took office. The fact though is that this data cannot tell us much about the tariff decisions, given that Trump’s – Executive Order 14257 – only really became operational on April 4, 2025, although there had been some earlier tariff changes before then....

William Mitchell — Modern Monetary Theory
US National Accounts – growth contracts but likely to be temporary
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

A Wake for a Dying System—Spring Meetings, Sovereign Debt & ChangeNow Summit — Fadhel Kaboub (MMT economist)

This week's gathering in Washington DC for the annual meetings of the World Bank and the IMF should be a wake for a dying global economic architecture, but unfortunately, a New International Economic Order cannot be born without African leadership to reposition the continent and the rest of the Global South away from the bottom of the global value chain. This is what I told the BBC Newsday on Monday....

Global South Perspectives
A Wake for a Dying System—Spring Meetings, Sovereign Debt & ChangeNow Summit
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

Misreading the Signs: Why High UK Borrowing Doesn't Mean Financial Crash — NeilW

 Matthew Lynn’s recent article (“The UK is heading for a full-blown financial crash, and nothing can stop it now”) paints a dramatic picture of fiscal doom, arguing that rising government borrowing figures signal an inevitable economic collapse. While the borrowing numbers themselves are significant, the conclusion that they spell imminent disaster fundamentally misunderstands how government finance works in a country like the UK, which issues its own floating-rate currency. Lynn’s analysis, focused solely on the government’s deficit, misses the other side of the equation: the non-government sector’s surplus....

New Wayland

Misreading the Signs: Why High UK Borrowing Doesn't Mean Financial Crash
NeilW

Capital Flight: A Misconception — NeilW

Recent commentary has expressed concern that investors are “taking their money out of America”. Such claims invoke the idea of capital flight, a concept historically relevant under fixed exchange rate systems. However, applying this term to modern floating exchange rate systems is misleading. While significant shifts in investment preferences can have major economic impacts, no actual “flight” of capital, in the sense of a net reduction, can occur—only balanced exchanges....

New Wayland
Capital Flight: A Misconception
NeilW

DOGE Goons Physically Drag Social Security Worker From Desk

 DOGE "goons?" Seriously? A bunch of computer geeks? How tough can they be? This shit's getting ridiculous.

Dimon implying an upcoming Treasury auction failure

 

Dimon seeing another regulatory snafu coming up and Fed going to have to suspend SLR again… same thing as spring 2020 … they never learn... buckle up for more chaos… 

Jamie Dimon now saying he expects the Fed to have to step in and rescue the bond market.

Unprecedented times.

We had +3% real GDP a quarter ago. pic.twitter.com/KQosKC3UhY

— Spencer Hakimian (@SpencerHakimian) April 11, 2025

“Tariff” reprieve

 

Maybe Cook and the other US multinational CEOs had to finally break the news to the Art degree morons in Trump & Co that the “trade deficit!” was their overseas retained earnings ? 

🤔

BREAKING: Treasury Secretary Bessent was instrumental in getting President Trump to back down on Chinese phone and computer tariffs after multiple calls with Apple CEO Tim Cook and other CEOs. Navarro and Lutnick sidelined and Navarro likely to be fired as scapegoat - SOURCES

— Mike Alfred (@mikealfred) April 12, 2025

The Accursed Tariffs — NeilW

Many electrons have been inconvenienced over this topic, and most have been in vain. I’ve wondered all week whether I had anything meaningful to add. However, a few points that have emerged in discussions are worth highlighting....

New Wayland
The Accursed Tariffs
NeilW

IRS has agreed to share migrants’ tax information with ICE

 

So imminently employers of  millions of illegals are gonna be submitting their FICA tax reports containing those now DOGE deleted 9M SSNs and IRS is gonna immediately flip that information over to ICE for immigration raids probably to the largest offenders first…

Could be a mass firing event which probably won’t show up in UE claims because the current employees are illegal… maybe job openings will spike up … while UE rate appears constant…

So Art degree Fed morons will interpret that as “inflationary!” and will be EVEN LESS inclined to reduce the policy rate for Trump…

I’m more worried about this whole thing than the whole “tariff!” BS…

You may want to load up on some frozen chicken beef or pork products this week just in case..

IRS has agreed to share migrants’ tax information with ICE, to help find immigrants they are trying to deport, per NYT

— unusual_whales (@unusual_whales) April 8, 2025