An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
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Wednesday, May 23, 2012
Steve Keen — Mountain of Debt: A Mountain of Stress on Economy
I think Steve King has done a great job pointing out the problem with private debt, but he really doesn’t agree with sector economics and the idea that private saving is government spending does he?
One difference I seem to notice between Steve Keen & Michael Hudson and MMTers, is that they place more emphasis on the idea of 'debt'. MMTers make a strong distinction between private-debt & public-debt. I believe that Michael and Steve don't make this 'strong' distinction. They seem to both prefer a debt-jubilee/cancellation, rather than an increase in public-debt.
I think this has profound consequences for how society treats the idea of 'debt'. IMO both remedies will have the same effect on balance sheets, however if a debt-jubilee was initiated people would realize the impotency of 'debt'.
Matt, what I took away from this was that people would get a 'one-time' forgiveness. Not an ongoing payment. But if people did get this 'one-time' payment, it would be interesting to see the response of the public wrt to 'where did the money come from?'
I think Steve King has done a great job pointing out the problem with private debt, but he really doesn’t agree with sector economics and the idea that private saving is government spending does he?
ReplyDeleteOne difference I seem to notice between Steve Keen & Michael Hudson and MMTers, is that they place more emphasis on the idea of 'debt'. MMTers make a strong distinction between private-debt & public-debt. I believe that Michael and Steve don't make this 'strong' distinction. They seem to both prefer a debt-jubilee/cancellation, rather than an increase in public-debt.
ReplyDeleteI think this has profound consequences for how society treats the idea of 'debt'. IMO both remedies will have the same effect on balance sheets, however if a debt-jubilee was initiated people would realize the impotency of 'debt'.
Most debt is housing and cars (and coming on strong recently, student loans)
ReplyDeleteIs Keen suggesting that we should just GIVE everyone a free house and a free car and a free education?
Is Keen in effect recommending a Basic Income Guaranty?
Resp,
Matt, what I took away from this was that people would get a 'one-time' forgiveness. Not an ongoing payment. But if people did get this 'one-time' payment, it would be interesting to see the response of the public wrt to 'where did the money come from?'
ReplyDeleteShaun H.
Anyone who still thinks that Steve King grasps the idea of sector economics and how to solve the debt crisis should read this mornings billy blog.
ReplyDeleteSteve Keen seems heavily invested in an "anti-debt" meme whether "private" or public....
ReplyDeleteResp,