commentary by Roger Erickson
To "balance fiat," we can't let liquidity be distributed widely enough to swap class-hegemony for national-agility?
Isn't that exactly what "balanced fiat" arguments come down to?
There are only two explanations available. Insanely stupid greed, or insanely stupid inability to grasp the difference between static value vs dynamic value. Both explanations may be at work simultaneously.
Operationally, does it matter which form of failure explains the failed actions of failed leaders? Regardless, the solution is to relieve them of duty, before they get us all killed.
It happens here, there and everywhere. Is this really so hard to understand?
RM Mitchell states: "The UK wisely kept its own currency, the pound, rather than join the mutual suicide pact of the euro nations. So the UK remains Monetarily Sovereign. It never can run short of its sovereign currency, the pound. It never needs to borrow pounds or to ask anyone for pounds.
Unfortunately, UK politicians, like U.S. politicians, act as though their nation were monetary non-sovereign. They seek balanced [fiat] budgets; they cut [fiat] spending; they raise [fiat] taxes -- all harmful to their [real] economies."
Both UK & US politicians and bank lobbyists are doing anything possible in order to avoid distributed scrutiny of what we spend our public initiative on, where, at what tempo?
Why, if we did that, we might as a nation be more adaptive! So why wouldn't they want us to do that? Actually, why the hell shouldn't we just do that, regardless of the 1% want?
Even the crooks are misguided simpletons. They may be crooks, but they're dumb crooks, and they're in the way of honest people who - if allowed - would produce more real wealth and capabilities than the crooks can possibly imagine. This whole scenario beggars belief. It's a bad play, regardless of who the authors are. We have a choice pending. We evolve, or we carry on with Fiat Stupidity.
To "balance fiat," we can't let liquidity be distributed widely enough to swap class-hegemony for national-agility?
Isn't that exactly what "balanced fiat" arguments come down to?
There are only two explanations available. Insanely stupid greed, or insanely stupid inability to grasp the difference between static value vs dynamic value. Both explanations may be at work simultaneously.
Operationally, does it matter which form of failure explains the failed actions of failed leaders? Regardless, the solution is to relieve them of duty, before they get us all killed.
It happens here, there and everywhere. Is this really so hard to understand?
RM Mitchell states: "The UK wisely kept its own currency, the pound, rather than join the mutual suicide pact of the euro nations. So the UK remains Monetarily Sovereign. It never can run short of its sovereign currency, the pound. It never needs to borrow pounds or to ask anyone for pounds.
Unfortunately, UK politicians, like U.S. politicians, act as though their nation were monetary non-sovereign. They seek balanced [fiat] budgets; they cut [fiat] spending; they raise [fiat] taxes -- all harmful to their [real] economies."
Both UK & US politicians and bank lobbyists are doing anything possible in order to avoid distributed scrutiny of what we spend our public initiative on, where, at what tempo?
Why, if we did that, we might as a nation be more adaptive! So why wouldn't they want us to do that? Actually, why the hell shouldn't we just do that, regardless of the 1% want?
Even the crooks are misguided simpletons. They may be crooks, but they're dumb crooks, and they're in the way of honest people who - if allowed - would produce more real wealth and capabilities than the crooks can possibly imagine. This whole scenario beggars belief. It's a bad play, regardless of who the authors are. We have a choice pending. We evolve, or we carry on with Fiat Stupidity.
20 comments:
Roger, we have to face the truth…these guys have a plan…and it doesn't include us. They have the fiat-producers by the balls.
If there was some way we could create a parallel society we might have a chance, otherwise…we're screwed.
Their plan - if that's what you want to call their "tactics" - is not impressive. All they have are personal tactics masquerading as national goals.
They can't possibly win unless we let them win, through complacency, neglect & default.
http://www.ragetrolling.com/Power-of-the-people
If there was some way we could create a parallel society we might have a chance
Exactly the conclusion or the DFHs in the '60s and 70s, so they created a parallel society that is going strong "underground." It meshes with the "gig economy" in that getting resources from the mainstream economy involves creating gigs to interface with it and extract what is needed without losing either one's soul or very much time and energy that could be devoted to more creative and productive pursuits. Before that, they were called "bohemians."
The proper deployment of a fiat currency by the currency provider is as a buffer that expands and contracts as needed in order to promote dynamic response to availability of real resources in terms of challenges and opportunities, based on reflexive use of intelligence. It's sort of like the water department management water needs for its area of service. Not exactly rocket science.
Right Tom...... doesn't belong in the economics dept perhaps.... rather 'govt operations ' rsp
"they were called "bohemians."
They've found a solution to that: high house prices and rents.
They've found a solution to that: high house prices and rents.
The bohemians were always on the move in that they occupied low rent districts until they became "in" places, and then they moved on. For example, SF and the Bay Area started getting expensive the 70s so the "artist" crowd moved north to where land was inexpensive, Mendocino and Humboldt counties, for example, and Grass Valley and Nevada City. Same in Manhattan, when the Village became "in" then the artists moved to lofts in SoHo. Now SoHo is ultra-in. Same with Provincetown, and Key West. And, of course, Costa Rica and Panajachel. But there are always new places with cheap living that the avant-garde migrates to.
BTW, the people that bought cheap land in places that later turned into "in" places clean up on land rent when they sold and moved on. That's a gig, too.
We don't have a chance because we were too "smart" to pay attention to people who understood what was happening decades ago. They were considered quacks who believe in "conspiracies." Books like Carrol Quigley's are merely a "limited hangout."
Now the same sorts of blindness are around in the form of judgments such as "insanely greedy" and the like. These people are not insanely greedy. It's not about more money or more things; it's about acquiring total power to be able to realize a "vision" an idea or set of ideas, with an endgame.Some of these people understand the entire endgame, some are billionaire "useful idiots" who have a twisted set of ideals. At any rate, finance is a key to the acquisition of power. As they say in Spanish, "con dinero baila el perro." "The dog dances (only) when you pay the money."
I've mentioned this before and my fellow MMTers quickly went down the rabbit hole with the details but... I still find it the single best question to frustrate ms economists and the thinking of the man on the street:
If we balance the budget and continue a 500 billion dollar trade deficit, how long before all net money is drained from the economy?
The contortions one has to do to square that circle is amusing...
DAB,
We are already well along that path you point out...
It is ALL going to the govt itself, the Fed, foreigners.... some remains with the non-govt corporate sector as retained earnings... nowhere else it can go...
Since Dec 1, these morons have only injected net $9B...
rsp,
@ DAB
Yeah, people who know anything say "Increase net exports." Like that would work with the USD as the global reserve currency.
@DAB
I just did a running total of NETEXP and it came to $8.5T…don't know if that says it all (FDHBFIN is ONLY about $4.8T) but we've only printed about $12T that people have their hands on…
@Paul
OK.. so we have a theoretical 24 year time frame until all the money is gone if we balance the budget.
:)
There was a hilariously ironic biomedical essay years back, called "The Last Well Patient"
It chronicaled the last guy on earth - circa 2030? - for whom no amount of medical testing could reveal a flaw. Clinicians, scientists & insurers were all mystified, and continually inventing more tests to run & charge for.
Anyone care to take a stab at one of the following?
"The Last Balanced Fiat Budget"
Or maybe:
"The Last Liquid Option"
Or should that be "The Last Growing Fiat" ?
Or simple "The Last Well Fiat Currency Issuer" ?
Ironically, "The Last Well Person" was a short essay written in 1994.
It's still behind a paywall!
(The Last Open Society?)
http://www.nejm.org/doi/full/10.1056/NEJM199402103300618
"I should have known it when the invalids began to disappear."
There was a predecessor, in French, from the 1920s.
“Sur les Pretendus Etats de Sante” (On the Supposed Condition of Good Health).
http://www.nejm.org/doi/full/10.1056/NEJM199407213310318
Come on, it's not only The Clueless who talk about having to "balance fiat".
There's a vast post-Keynesian literature on the idea that the balance of payments (between countries) is the ultimate constraint on the ability to autonomously increase demand.
According to most PK economists, the US has an exceptional position which may or may not allow it to avoid the BoP constraint. Most other countries are not so lucky.
This is, in fact, the main difference between MMT and other post-Keynesians regarding the "sustainability" of (current account) deficits.
It's an ongoing debate.
Here's M. Vernengo, for example:
http://www.levyinstitute.org/publications/?docid=1374
"OK.. so we have a theoretical 24 year time frame until all the money is gone if we balance the budget." - DAB
Actually 7 years...assuming they already have $8.5T of it.
The kicker is, if we balanced the budget the trade deficit would probably vaporize because the world economy would collapse along with ours.
What about Heisenbankers uncertainty principle? The more they try to determine the precise amount of fiat, the higher it's momentum grows.
Conversely, the more they try to determine the distributed momentum of fiat, the less controllable it is.
That scares the shit out of the bankers. Meanwhile, the sewers are backing up. Heisenturd's uncertainty principle applies to the condundrum of identifying the exact position of the blockage and the preceding momentum. Shit will hit the fan, but no one can say when or where.
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