(These remarks will be delivered today at the UBS European Conference in London.)Multiplier Effect
A Better Way to Think about the “Twin Deficits”
L. Randall Wray | November 13, 2018
(These remarks will be delivered today at the UBS European Conference in London.)Multiplier Effect
2 comments:
“A sovereign government cannot run out of its own liabilities. All modern governments make and receive payments through their central banks. Government spending takes the form of a credit by the central bank to a private bank’s reserves, and a credit by the receiving bank to the account of the recipient. You cannot run out of balance sheet entries.”
Why isn’t the academe of cognitive “science “ helping out to correct this population wide cognitive deficiency/error of reification?
Too busy studying chimpanzees?
If you asked any cognitive “scientists” if we are running out of “money” they all would say ‘yes!’.....
The population already understands that a monetary sovereign cannot run out of its own money - that's obvious.
The real problem is that the banking model is designed/evolved for expensive fiat, i.e. for the Gold Standard, which had the effect of eliminating monetary sovereignty.
Wray and the others need to face that inexpensive fiat and the current banking model are not compatible - unless their hidden agenda is to save the current banking model from itself, and not promote the general welfare and economic justice.
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