The Rise of the Modern Monetary System: An Integration of the Credit and State Money Approaches— L. Randall Wray

 This working paper integrates the credit money approach (associated with Post Keynesian endogenous money theory) with the state money approach (associated with Modern Money Theory) by drawing on Wray’s 1990 book (Money and Credit in Capitalist Economies: The Endogenous Money Approach, Edward Elgar), his 1998 book (Understanding Modern Money: the Key to Full Employment and Price Stability, Edward Elgar), and his 2004 edited book (Credit and State Theories of Money: The Contributions of A. Mitchell Innes, Edward Elgar). New sources and interpretation of the history of money make it clear that there is no contradiction between state money and private credit money—each played a role in the creation of the modern monetary system. Indeed, today’s system was created by bringing state money into the private money giro, thereby strengthening both.

Levy Economics Institute of Bard College
The Rise of the Modern Monetary System: An Integration of the Credit and State Money Approaches
L. Randall Wray | Professor of Economics, Bard College

Episode 11 (S2) of the Smith Family Manga is now available–intergenerational tensions arise within the Smith household — Bill Mitchell

Today (February 13, 2025), MMTed releases Episode 11 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 11 (S2) of the Smith Family Manga is now available – intergenerational tensions arise within the Smith household
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

DOGE rant

Mike with epic rant against the DOGE propaganda .. instant classic!

Trump's Executive Order to Rename Debt and Deficits — Stephanie Kelton

Rename "debt" and "deficit" to reflect reality.

The Lens
Trump's Executive Order to Rename Debt and Deficits
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

Bessent says he and Trump focusing on 10-year Treasury yields—not Fed policy

 

This is 100% pure BS…. They surely want the Fed to lower the rates… don’t believe it…

Bloomberg: Treasury Secretary Scott Bessent says he and Trump are focusing on 10-year Treasury yields—not Fed policyhttps://t.co/rIUuEBHUAK pic.twitter.com/quBnoYdwsg

— Lance Lambert (@NewsLambert) February 6, 2025

The US Needs a Sovereign Wealth Fund Like a Fish Needs a Bicycle — Stephanie Kelton

It was 2020, and Trump was responding to a question about a $6.2 trillion fiscal package (emergency COVID spending plus day-to-day operations). The reporter might have been confused about where the money was coming from, but Trump wasn’t. “The beautiful thing about our country is…we can handle that easily because of who we are—what we are—it’s our money…it’s our currency,” he explained.…

Understanding what it means to issue a sovereign currency is at the core of Modern Monetary Theory (MMT). If you’re new to MMT, click this link and watch Professor L. Randall Wray explain. The bottom line is that a currency-issuing government, like the United States, never has to worry about “finding the money.” As Wray explains, the money gets spent into existence when Congress authorizes a budget and the payments are made. (Incidentally, it works that way in the UK and in other countries with sovereign currencies as well.)

If you’ve been following MMT for a while, you’ve probably heard Warren Mosler refer to the U.S. as the “scorekeeper” for the US$. His point is that we shouldn’t think of a currency-issuing government as “having” or “not having” any dollars. The scorekeeper maintains the spreadsheet by crediting and debiting bank accounts as the government spends (adds) and taxes (subtracts) dollars from the various “players” in the game. When there’s a Congressional appropriation for $6.2 trillion, the government creates $6.2 trillion. It literally spends the money into existence. That’s the power of a sovereign currency.

It’s hard to see why anyone who understands how a sovereign currency works would be pushing a sovereign wealth fund. Even if it became “one of the biggest funds” in the world, as Trump envisions, it wouldn’t give the federal government any spending power it doesn’t already have. 

So what exactly does the president intend to do with a sovereign wealth fund that can't be done without one, or at least not as effectively or efficiently? Or did he forget what he knew?

The Lens
The US Needs a Sovereign Wealth Fund Like a Fish Needs a Bicycle
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

Your 4-Step Guide to Understanding the 2008 Financial Crash & Subsequent Recession From a Modern Monetary Theory (MMT) Perspective — Jim Byrne

Politicians on both sides of the Atlantic are once again talking about rolling back banking regulations to kick-start growth. This article is a timely reminder of why those regulations exist.

MMT101.ORG - Learn Modern Monetary Theory (MMT)
Your 4-Step Guide to Understanding the 2008 Financial Crash & Subsequent Recession — From a Modern Monetary Theory (MMT) Perspective
Jim Byrne | MMT Scotland

Canada response to tariffs

 

Where was this play in the Art degree Keynesian free market fundamentalism playbook?  I thought the Canada people were just supposed to add the tariff onto the price of the products?  Instead they are removing the products from inventories… going to create a glut of these products in the US and US prices are going to fall to get rid of it … no “inflation!”… 🤔

Canada’s biggest province said it will remove American products from its government-run liquor stores as part of its response to President Donald Trump’s 25% tariffs on Canadian imports https://t.co/a2sCx4ajuE

— Bloomberg Economics (@economics) February 2, 2025

Fed on tariffs

 

LOL … then according to Art degree monetarists they should reduce the rate to figure of speech  “counter the headwinds!”.. which is what Trump wants them to do in the first place… 

We read the transcripts of the Fed's 2019 meetings so you don't have to, and here's the main takeaway: The headwinds they felt from Trump's tariffs were strong https://t.co/57LOVFGjbn

— Bloomberg Economics (@economics) February 2, 2025

2025 Fiscal

 

Looks like DOGE/Elon trying to reduce top line by $1T by September… US GDP $27T/yr…. So no multiple that’s a direct 3.7% … 

I guess they think they’re only reducing govt spending on unnecessary regulatory activities or something… climate nutter stuff etc… maybe the “Argentina model”… 🤔

Reducing the federal deficit from $2T to $1T in FY2026 requires cutting an average of ~$4B/day in projected 2026 spending from now to Sept 30.

That would still result in a ~$1T deficit, but economic growth should be able to match that number, which would mean no inflation in…

— Elon Musk (@elonmusk) January 31, 2025

He seems to understand the Art degree figure of speech “money!” as rather a scientific abstraction:

The real economy is not money, it is goods & services.

Money is simply an abstract representation of real things. https://t.co/mmOHBdTmkr

— Elon Musk (@elonmusk) January 31, 2025

The Case of the Missing Report–Part 2 — Bill Mitchell

Today, we solve the ‘Case of the Missing Report’. Recall from – The Case of the Missing Report – Part 1 – that the Asian Development Bank published a report I had written (with Randy Wray and Jesus Felipe) – A Reinterpretation of Pakistan’s ‘economic crisis’ and options for policymakers (draft version) – in June 2009 as part of work I was undertaking for the Bank at the time on economic development in Central Asia. The report was published on June 1, 2009 as an official ADB Economics Working Paper No. 163 after our presentations were enthusiastically received at the Bank during seminars we gave. The Report was indexed by the major bibliographic and indexing services and evidence of that report still exists today. For example, the Asian Regional Integration Center provides a link to some 30 records covering – Pakistan – including our ADB paper with the official publication date. The ‘official’ link to the publication – https://www.adb.org/Documents/Working-Papers/2009/Economics-WP163.pdf – however, now returns a ‘Page not Found’ error. Then, if you search for ADB Economics Working Paper No. 163 on the ADB WWW Site you will find another paper – The Optimal Structure of Technology Adoption and Creation: Basic Research vs. Development in the Presence of Distance to Frontier – which somehow became Working Paper No 163 and was also published in June 2009. So what gives? How did our ADB Economics Working Paper No. 163 disappear from the face of the Earth to be replaced by another ADB Working Paper No. 163, all in the space of a day or so? In this Part 2 of the ‘Case of the Missing Report’, I provide the solution to the mystery....

William Mitchell — Modern Monetary Theory

The Case of the Missing Report – Part 2
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

NVDA exports

 

Art degree morons as usual can’t understand the Accounting abstractions… think NVDA has to be shipping the REAL units to where the Accounting ABSTRACTIONS are recorded…

Like I guess they think we’re importing $300B net of Guinness, Jameson and potatoes from Ireland…

It’s the same as the current Trump “tariffs!” womanish soap opera… A LOT of people are going to get that wrong for the same reasons…

Looks like $NVDA GPUs have never been physically in Singapore ⚠️

So, according to $NVDA 10-Q disclosures “For example, most of the shipments associated with Singapore revenue went to either the United States or Taiwan in the first quarter of fiscal year 2025.”

Guess what..… https://t.co/n0Wr9IEz8M pic.twitter.com/plgg6ZdA7K

— JustDario 🏊‍♂️ (@DarioCpx) June 29, 2024

The Case of the Missing Report – Part 1 — Bill Mitchell

 This blog post is a long time in gestation and I could have written in 2009 which is the relevant year of the events that I will document in this two-part series. My conversations with government officials during my working trip to the Philippines last week highlighted several things, including their sheer terror of IMF intervention and the ratings agency. I will write separately about that in a later post. But the IMF watches these types of nations like a hawk and is ready to pounce to enforce their authority at the slightest departure from the neoliberal macroeconomic policy line. As long as these types of nations concede to the IMF bullying they have very little hope of developing towards being advanced states. And IMF bullying is what this blog post is about. This is Part 1 of a two-part story that might be summarised as the ‘Case of the Missing Report’. I will solve the mystery in Part 2, which will be published on Thursday of this week.

William Mitchell — Modern Monetary Theory
The Case of the Missing Report – Part 1
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

The Impact of 25% Tariffs on Canadian GDP—The Bank of Canada vs Deepseek — Stephanie Kelton

Stephanie asks Deepseek.

The Lens
The Impact of 25% Tariffs on Canadian GDP—The Bank of Canada vs Deepseek

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

What is the University of Michigan Survey of Consumer Sentiment Telling Us? — Stephanie Kelton

 Expectations.

The Lens
What is the University of Michigan Survey of Consumer Sentiment Telling Us?
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

Source of funds for tariffs

 

This statement/tweet isn’t exclusively true:

MAGA will do whatever, but tariffs are taxes we pay on imports. It's time media outlets called them that. https://t.co/OZnlnS5YvU

— Dean Baker (@DeanBaker13) January 26, 2025

the foreign entities can simply lower their import prices in USD terms and access these foreign USD account balances as source of USDs to pay any new tariffs:

 

A Framework for a Basic Bank — NeilW

In analysis, it’s helpful to simplify and focus on the core elements of a system. Today, we will identify the essential processes and structures required to create a functional bank, accompanied by diagrams to illustrate these key processes.

New Wayland Blog

A Framework for a Basic Bank
NeilW

Climate nutters useful idiots for insurance scammers

 

Can’t even make it up… moron intellectual degenerate Art degree climate nutters (who couldn’t tell you the atomic number of hydrogen) running interference for the insurance scammers…

California's insurance system is broken for a variety of reasons, but climate change is not one of them.

There is no greater consumer scam underway than insurance industry trade groups blaming climate change for skyrocketing rates. The media is complicit, on the take. https://t.co/VN9RU7F7Oz

— Ryan Maue (@RyanMaue) January 25, 2025

Field trip to the Philippines–Report — Bill Mitchell

I have been working in Manila this week as part of a ‘knowledge sharing forum’ at the House of Representatives which was termed ‘Pathways to Progress Transforming the Philippine Economy’ that was run by the Congressional Policy and Budget Research Department, attached to the Congress (Government). I am also giving a presentation at De La Salle University on rogue monetary policy. It has been a very interesting week and I came in contact with several senior government officials and learned a lot about the way they think and do their daily jobs. I Hope the interactions (knowledge sharing) shifted their thinking a little and reorient to some extent the way they construct fiscal policy. This blog post reports (as far as I can given confidentiality) what went on at the Congress.

William Mitchell — Modern Monetary Theory

Field trip to the Philippines – Report
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

What I've Been Up To — Stephanie Kelton

I am back in New York after an extended trip to California. Before I left town, I joined Scarlet Fu on Bloomberg Markets. We talked about the GOP plan to pass “one big beautiful bill” as quickly as possible and how much of it they’re going to try to offset/“pay for” (versus adding to the deficit)....

The Lens

What I've Been Up To
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 Sand…

See also

The following mentions MMT and Stephanie

NTD

5 Key Points From Biden’s Final Interview as President

Nathan Worcester

The Reserve Requirements Fad: A Solution in Search of a Problem NeilW

The Latest Epicycle in Interest Rate Mythology

Every so often, a new fad emerges to prop up the fantasy that interest rate targeting is some economic panacea. The latest contender? Reserve requirements.

The premise is simple: if we stop paying interest on massive excess reserve quantities held by banks, we won’t have to hand over vast sums to them. The stunning amount of intellectual effort required to come to this conclusion is why economists earn the big money. Predictably, it has been seized upon by those Right-Thinking Lefties who detest bank profits but remain wedded to the mystical notion of an all-controlling interest rate.

Misunderstanding Banking—Again

Since economists construct their banking theories on layers of myths, they inevitably arrive at the wrong conclusions. Yanis Varoufakis fell into precisely this trap when applying the reserve requirement argument to the UK.

So, let’s take a step back and examine reserve requirements in the context of UK banking—without the distortions of mainstream economic dogma....

New Wayland Blog

The Reserve Requirements Fad: A Solution in Search of a Problem
NeilW

The Gower Intitiative for Modern Money Studies newsletter – January 2025

Report on happenings in 2024 with some links.

The Gower Initiative for Modern Money Studies
The Gower Intitiative for Modern Money Studies newsletter – January 2025

Trump plan to reduce “inflation!”

 

Trump plan to reduce “inflation!”…. 1.  Get energy production costs down (ie euthanize the “climate!” nutters) … 2. Reduce the policy interest rate (ie order the Fed to reduce FFR/IOR)…

Nooooooooooobody right now thinking he can do any of this …

Fed withdraws from global “Climate!” group

 

This is a good sign the Fed may be generally acquiescing to Trump admin policies….

🇺🇸Fed Announces Withdrawal from Global Climate Coalition. pic.twitter.com/xjSgOFPRwi

— Update NEWS (@UpdateNews724) January 17, 2025

Episode 10 (S2) of the Smith Family Manga is now available—Coal Port Blockade but the progressives want to tax the rich — Bill Mitchell

Today (January 17, 2025), MMTed releases Episode 10 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 10 (S2) of the Smith Family Manga is now available – Coal Port Blockade but the progressives want to tax the rich
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

“Hydrants out of water!”

This is funny the Art Degree morons all think fire hydrants contain a fixed amount of water (rather than control pressure) i.e.  “the hydrants ran out of water!”  … meanwhile they think govt treasury can “pump in money!” … both AT THE SAME TIME…   😂😂😂😂😂

Gov. Newsom on LA not having water in its fire hydrants: Not my job pic.twitter.com/2SzW3Az1D8

— End Wokeness (@EndWokeness) January 9, 2025

Return to a "Appropriate and Positive Interest Rates" ーInterpreted through the Lens of Monetary Theory — Masashi Chikahiro

MMT influence is spreading.

Chuo University

Return to a "Appropriate and Positive Interest Rates" ーInterpreted through the Lens of Monetary Theory ー Sixth Collaborative Course with "Otemachi Academia"
Masashi Chikahiro, an associate professor at Chuo University's Faculty of Economics (Japan)

See also

Based on Japanese studies.

William Mitchell — Modern Monetary Theory

Shifts in societal attitudes towards well-being mean that a degrowth strategy does not necessarily have to be political suicide

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

The currency message from BRICS leaders amarynth

To calm shattered nerves in the west, the message is out: BRICS is not floating a new currency; BRICS is providing alternative economic structures and systems (and currencies) to trade with one another....

Michael Hudson noted three challenging points — foreign debt exposure, economic rent extraction, and the need to raise living standards and labor productivity….

 Indonesia, the fourth most populous nation, is now also a member of BRICS. 

Global South

The currency message from BRICS leaders

amarynth

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