Sunday, May 31, 2020

Bill Mitchell — Why do currency-issuing governments issue debt – Part 1

One question that continually comes up when I do interviews is this: If governments are not financially constrained in their spending why do they issue debt? Usually, the question is expressed in an incredulous tone, meaning that the person asking the question considers this to be the gotcha moment, when they pierce the impeccable logic of Modern Monetary Theory (MMT) and show it for what it is – a sham. One problem is that there is a tendency to confuse motivation with function and many people sympathetic to MMT reduce it to simple statements that belie the reality. One such statement, relevant to this topic, is that government’s issue debt to allow the central bank to maintain a specific short-term interest rate target. Central banks have traditionally used government debt as an interest-rate maintenance tool. But that is a function of the debt rather than being the motivation for issuing the debt in the first place. So we explore those differences today as a means of clarifying the questions and confusions around this issue. This is Part 1 of a two-part series, which I will finish tomorrow....
Bill Mitchell – billy blog
Why do currency-issuing governments issue debt – Part 1
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

China

Zero Hedge"The Dollar Is Out Of Stock Everywhere": Hong Kong Money Exchangers Turn Away Clients Amid Run On US Dollars

Pompeo: China Is Intent Upon The Destruction Of Western Ideas, Western Democracies, And Western Values

Large domestic disturbances, the U.S. Military, and the Insurrection Act — Robert Willmann


The relevant law.

Sic Semper Tyrannis
Large domestic disturbances, the U.S. Military, and the Insurrection Act
Robert Willmann

RT — Elon Musk tweets IN RUSSIAN to accept co-operation offer from Russia’s space agency


Classy — for a change.

RT
Elon Musk tweets IN RUSSIAN to accept co-operation offer from Russia’s space agency

TASS

National Guard, Now Authorized to Use Live Ammo, Flood America’s Streets — Alan Macleod


"Move on. Nothing to see here. Hong Kong, Uyghurs, Chinese flu, Russia, Iran...."

Note: "use live ammo" is unclear. The Guard is authorized carry live arms, but rules of engagement have not been revealed to my knowledge. These folks are trained and equipped for combat and not policing.

Mint Press News
National Guard, Now Authorized to Use Live Ammo, Flood America’s Streets

Why? — Andrei Martyanov

So, Trump wants to exclude China from "international community" by holding this gathering which decides nothing and is worthless in terms of any practical solutions to an unfolding catastrophe which is global economic crisis. So, anyone can explain what Russia is to gain, other than some photo-ops for Trump, from this meeting? Why should Vladimir Putin even be there? Moscow and New Delhi have a direct line and can solve their issues by talking directly, Europe, frankly, is economically suicidal, Australia is a non-entity for Russia, so why? I don't know, but Trump, evidently thinks that this is a good idea. I think it is a waste of time, because the settling of global issues must happen first between G-3: China, US and Russia. Until something is decided within this triangle no other meetings will produce any sensible world order which will reasonably satisfy everyone. The United States is not ready to deal with this issue yet, but US has only two options here: war and getting back to the reality. What will be this choice we don't know yet, hopefully the latter one.
Reminiscence of the Future
Why?
Andrei Martyanov

Also

Good luck with that.

Defend Democracy Press
Trump wants an anti – China alliance


Why making economic predictions now is useless — Branko Milanovic


Shouldn't need saying, but it does. Obvious is not always obvious to everyone. And Branko Milanovic only lists a few of the reasons. There are a lot of balls in the air — or knives.

Global Inequality
Why making economic predictions now is useless
Branko Milanovic | Visiting Presidential Professor at City University of New York Graduate Center and senior scholar at the Stone Center on Socio-economic Inequality, senior scholar at the Luxembourg Income Study (LIS), and formerly lead economist in the World Bank's research department and senior associate at Carnegie Endowment for International Peace

Breakingviews - Review: MMT lives up to some of its promises — Edward Hadas


Generally favorable review of about to be released, The Deficit Myth by Stephanie Kelton.

Strategically, I am good with "generally favorable" reviews with qualification. Effusively positive reviews would likely get a similar reaction to negative rants. I would say that "balanced" reviews like this will help sales and that will help to get the word out there as well as influence "influencers."

Reuters
Breakingviews - Review: MMT lives up to some of its promises
Edward Hadas


North Atlantic vs Eurasia — Paul Antonopoulos


Germany wobbling?

Bill Totten's Weblog
North Atlantic vs Eurasia
Paul Antonopoulos
Originally at Infobrics

Some Critical Responses — Peter Radford

I happen to think that the ignorance revealed by total factor productivity could be reduced by the abandonment of both “capital” and “labor” from a production function and replaced by more accurate inputs such as energy, raw materials, skill, and information or knowledge. Heck, I would even find room for management in there. I don’t think it possible to “maximize” anything in an economy because of the irreducible uncertainty facing decision makers. Equilibrium is more an illusion than a fact because the system is bothy open and dynamic. It may be useful as an investigative tool, but as a description of reality? Oh, and I tend to see the world through the prism of evolution and complexity.
The Radford Free Press
Some Critical Responses
Peter Radford
 
 

Now there's trouble busin' in from outta state...


From the 'Nebraska' album... The Boss' best work imo...


Now there's trouble busin' in from outta state
And the D.A. can't get no relief 
Gonna be a rumble out on the promenade...

Well now everything dies baby that's a fact 
But maybe everything that dies someday comes back 
Put your makeup on, fix your hair up pretty 
And meet me tonight in Atlantic City









John Quiggin — Modern Monetary Theory: Neither modern, nor monetary, nor (mainly) theoretical?


John Quiggin reviews the MMT textbook, Macroeconomics by William Mitchell, Randall Wray and Martin WattsMore favorable than the title suggests, although with qualifications. Importantly, the review distinguishes academic MMT from popular MMT. Worth reading.

John Quiggin's Blog
Modern Monetary Theory: Neither modern, nor monetary, nor (mainly) theoretical?
John Quiggin | Professor and an Australian Research Council Laureate Fellow at the University of Queensland, and a member of the Board of the Climate Change Authority of the Australian Government

Government Spending Comes First in a Sovereign Currency System — Peter Cooper


Mini-article. Keeper.

heteconomist
Government Spending Comes First in a Sovereign Currency System
Peter Cooper

Scientist posits ‘wild’ hypothesis that cross immunity could slow pandemic

WHO expresses caution on whether there may be protection from prior exposure to some cold viruses; scientists examine if some people are more vulnerable to infection than others


The conspiracists are saying that C19 is not particularly harmful to the vast majority of people, and if their figures are correct, could this explain the mystery of why C19  never did as much harm as the scientists expected. It is only an hypotheses, and more research is needed.

If this turns out to be the case, we were lucky this time. Let's hope we are better prepared for future pandemics.


In a recent post on Twitter, Francois Balloux of University College London noted an “intriguing” lack of an immediate resurgence in COVID-19 cases following the easing of lockdowns in several countries.

...that a “proportion of the population might have pre-existing immunity to #SARSCoV2, potentially due to prior exposure to ‘common cold’ coronaviruses.”


Times of Israel 

Scientist posits ‘wild’ hypothesis that cross immunity could slow pandemic


George Szamuely on the US riots.

Russia is getting blamed for the US riots, rather than the US economic and political failed policies.

I read an article yesterday about GMOs, which said that Russia had spread conspiracy theories about their dangers. These conspiracy theories are getting out of hand. Although GMOs do appear to be safe.



Why anti-vaxxers will refuse the coronavirus vaccine

I was reading what I thought was a good article earlier about C19 conspiracies and I thought I might tweet it, except two thirds of the way through it blamed Russia and China for spreading some of the these theories to sow discord in the West. Fortunately, this Guardian video doesn't go there.


Saturday, May 30, 2020

Southfront — CNN Pushes ‘Russian Meddling’ Version In Its Coverage Of Minneapolis Riots


Finally, CNN found whom to blame for the recent spike of violence in the United States. It’s the ‘Russian trace’ that, according to CNN, should be checked in the case of Minneapolis riots.
Donald Trump calls it "fake news" on Twitter.

Meanwhile the wheels aren't just falling off, they are being burned up.

Southfront
CNN Pushes ‘Russian Meddling’ Version In Its Coverage Of Minneapolis Riots

John Maynard Keynes: How Much Does Finance Matter? Brad DeLong


Keeper Keynes quote anticipating the fundamental assumption of MMT that the only actual constraint is real resources, which is the foundation of Stephanie Kelton's new book, The Deficit Myth (available June 9).

Professor DeLong does not state this explicitly, but we can probably assume that this post is not a coincidence and it is as close as he wants to get.

Anyway, Keynes make the point that so-called affordability is a non-issue.  Austerity in the name of fiscal responsibility is a monumental error the cost of which through needlessly foregoing inherent potential is incalculable.

Grasping Reality
John Maynard Keynes: How Much Does Finance Matter?
Brad DeLong | Professor of Economics, UCAL Berkeley

Beijing sees Trump’s hand and won’t fold — Pepe Escobar

Team Trump has vociferously announced its own strategy. Expect serial, silent Sun Tzu counterpunches.
Asia Times
Beijing sees Trump’s hand and won’t fold
Pepe Escobar

Comments On Tyler Cowen's Review Of "The Deficit Myth" — Brian Romanchuk

Tyler Cowen did a review of "The Deficit Myth" by Stephanie Kelton, which is to be released June 9 (Amazon affiliate link). Since I have not read the book yet myself, I cannot comment on his views about the book. However, Cowen makes some criticisms of Modern Monetary Theory (MMT) that are worthwhile responding to.
I am turning to writing a short primer on MMT, and will probably have a chapter on critiques that I feel are useful. (My estimate is that over 90% of "MMT critiques" consist of people making stuff up, based on the contents of other "critiques.") I expect that I could use some of the discussion here as examples. The review consists of a dozen numbered short points, and I will only respond to the ones that I see as being useful, and not solely related to the book....
Bond Economics
Comments On Tyler Cowen's Review Of "The Deficit Myth"
Brian Romanchuk

China Is Not the Enemy — Neoliberalism Is — Isabella Weber, Hao Qi, and Zhongjin Li


Another side of the story.

Isabella Weber, Hao Qi, and Zhongjin Li

See also

The Diplomat is usually pretty US and Western-centric in its viewpoint. However, the unique American and geographically delimited Western liberal views are foundationally different from other views, such as the Chinese and other Asian, Islamic, etc. Viewing one predominantly of exclusively through the lens of another skews the analysis away from objectivity.

This article is more balanced and nuanced, and is worth a read. The author seems to be personally familiar with the Chinese and Western viewpoints.

The Diplomat
How Chinese Nationalism Is Changing
Brian Wong

RT — AI to choose your news? Microsoft to get rid of journalists & replace them with ROBOTS


Coming to a job near you soon?

Interestingly, there is push on the "far left" to completely automate and robotize, making wage workers obsolete.* These "futurologists" see this quantum leap in technological innovation and its scaled application as a "new mode of production" in the Marxist sense of making possible "new relations of production" based on treating technology as a public utility under public control and operated for public purpose rather than subject to private ownership. No Luddites allowed.

MMT would suggest that this transition from private investment as the driver to public investment as entirely possible since the constraint is availability of real resources rather than finance.

This also accords with R. Buckminster Fuller's vision of design science as doing more with less, his systems approach through the world game, and his view that while material resources may be finite, "metaphysical resources" (his words), that is, knowledge and know-how, are infinite in potential and only need to be developed through education in the broadest sense. While physical (biological) evolution underlies individual reproduction, psychic evolution underlies social reproduction.

RT
AI to choose your news? Microsoft to get rid of journalists & replace them with ROBOTS

* Aaron Bastani, Fully Automated Luxury Communism – A Manifesto (Verso). Short review here.

Patrick Lawrence — America: The Deluded Superpower

China and Russia, because they have given up exceptionalism, full spectrum dominance and all those other fantasies, only have to counter the U.S. military and only in their home neighbourhoods. That is much cheaper and much easier. What’s really expensive, because unattainable, is chasing after the exceptionalist goal of dominance in everything, everywhere, all the time. That’s a “tried and true” road to oblivion.
Defense is a lot less costly than offensive, especial "full spectrum dominance." Also, anyone with any familiarity with Chinese martial history knows that it’s a history of weapons innovation and countering.

Strategic Culture Foundation
America: The Deluded Superpower

also

TASS
Too late to deal with New START extension after US presidential election - [Russian] diplomat

Also
America’s status as a superpower has been damaged by its inability to beat the Taliban in nearly 20 years of war
America pulls out of another quagmire (after Vietnam), now bogged down in Syria.

The Independent
Donald Trump’s withdrawal of troops from Afghanistan is an unavoidable recognition of failure
Patrick Cockburn

Also

The Unz Review
What Happens Next in Afghanistan? the Neo-Taliban
Ted Rall

Sputnik — Donald Trump and Angela Merkel Reportedly Clash Over Nord Stream 2 Gas Pipeline

Donald Trump, writes the outlet, has repeatedly criticised Germany, and Chancellor Merkel specifically, over issues such as Berlin's defence spending and commitment to NATO, while Merkel, in turn, publicly took issue with the Washington administration's “unilateral approach” to a succession of foreign policy issues.
Sputnik International
Donald Trump and Angela Merkel Reportedly Clash Over Nord Stream 2 Gas Pipeline

Sputnik — Exclusive: Ex-Ukrainian President’s Aide Opens Up on Biden Tapes, Democrats' Money Laundering


Biden lawyering up?

Sputnik International
Exclusive: Ex-Ukrainian President’s Aide Opens Up on Biden Tapes, Democrats' Money Laundering

Southfront — U.S. Seizes $1.1 Billion Of Russian-Printed Libyan Currency In Joint Operation With Malta


Short and of interest about "parallel currency."
The [US State Department] spokesman, Morgan Ortagus, called the bank an “illegitimate parallel entity,” stressing that the Government of National Accord (GNA) bank, the Central Bank of Libya, is the country’s only legitimate central bank.
Southfront
U.S. Seizes $1.1 Billion Of Russian-Printed Libyan Currency In Joint Operation With Malta

See also

The Russian Foreign Ministry begs to differ.

TASS
US Department of State statements are counterfeit, not dinars seized in Malta - ministry
Related

Sputnik International
US May Send Troops to Tunisia Over Alleged Russian Campaign to Destabilize Region, AFRICOM Says

Friday, May 29, 2020

Our Grim Future: Restored Neoliberalism or Hybrid Neofascism? — Pepe Escobar


Pepe Escobar is emerging as a public intellectual in addition to being a reporter on geopolitics as someone worth taking into account. He is accomplished in several languages, widely read and widely travelled, and also well-connected. He brings a different lens to examine the world scene than most national reporters. His nationality is Brazilian but Brazil is not his focus.

Strategic Culture Foundation
Our Grim Future: Restored Neoliberalism or Hybrid Neofascism?
Pepe Escobar

Thursday, May 28, 2020

We’ll Need Mass Debt Forgiveness to Recover From the Coronavirus — Eric Levitz


MMT friendly.

Favorite lines:
Money is created in one of two ways: by the government making payments (Uncle Sam writes you a check, the bank then credits that to your account) or the bank extending a loan, in which case the bank credits money to your account against a contract saying you’re going to pay it back. The government extinguishes money by taking in taxes; the bank extinguishes it by taking in loan repayments.
The question of how much money is created is determined by how much activity the public and private sectors are willing to animate. How many loans does the banking sector wish to extend? How much spending will the public sector approve?
Regarding the title, I would not say debt "forgiveness" but "restructuring." Only debts that cannot be repaid need to be discharged. This would reduce or prevent Chapter 7 bankruptcies and evictions, that can cascade and produce a domino effect. Other debts can be restructured, which is what Chapter 11 is about. This would apply to essential production and services, for example.

The trick is to head off systemic risk that results in a deep recession or even a debt-deflationary depression.

This could be avoid by an economic snap-back, a so-called V-shaped contraction. However, absent an quite recovery, debt can become a problem.

The Intelligencer
We’ll Need Mass Debt Forgiveness to Recover From the Coronavirus
Eric Levitz

Albert Einstein Explains Why We Need to Read the Classics — Josh Jones


Now that many people have time on their hands...

Open Culture
Albert Einstein Explains Why We Need to Read the Classics
Josh Jones

See also
For these reasons, we should be on our guard not to overestimate science and scientific methods when it is a question of human problems; and we should not assume that experts are the only ones who have a right to express themselves on questions affecting the organization of society....

See also

Perhaps one of the clearest and simplest statements of an outline of an argument for socialism. 

Monthly Review
Why Socialism?
Albert Einstein

The Investment Cost of the U.S.-China Trade War — Mary Amiti, Sang Hoon Kong, and David E. Weinstein

In sum, we find that the U.S.-China trade war lowered the market capitalization of U.S. listed firms by $1.7 trillion and will lower their investment growth rate by 1.9 percentage points by the end of 2020.
FRB — Liberty Street Economics
The Investment Cost of the U.S.-China Trade War
Mary Amiti, vice president in the Federal Reserve Bank of New York’s Research and Statistics Group; Sang Hoon Kong, economics Ph.D. student at Columbia University; and David E. Weinstein Carl S. Shoup Professor of the Japanese Economy at Columbia University

You can now buy used clothes online from Walmart — Elizabeth Segran


Recycling moves to another level.

Fast Company
You can now buy used clothes online from Walmart
Elizabeth Segran

Who pays for Covid-19? Assessing seven potential options — Arvind Ashta


Arvind Ashta rejects MMT as hyerinflatonary, and the other options as problematical. He then proposes a Tobin tax and admits that it is probably unrealistic, too, since the finance sector bear the burden of being taxed.

LSE
Who pays for Covid-19? Assessing seven potential options
Arvind Ashta is a Senior Professor in the Burgundy School of Business, Université Bourgogne Franche-Comté, Dijon, France

*The Deficit Myth* and Modern Monetary Theory — Tyler Cowen


An Austrian economist reviews Stephanie Kelton's new book.

Marginal Revolution
*The Deficit Myth* and Modern Monetary Theory
Tyler Cowen | Holbert C. Harris Chair of Economics at George Mason University and serves as chairman and general director of the Mercatus Center

Washington Post Tells Readers About Trump’s “Existential” Threat to China — Dean Baker


Shooting from the hip and hitting oneself in the foot?

Beat the Press
Washington Post Tells Readers About Trump’s “Existential” Threat to China
Dean Baker | Co-director of the Center for Economic and Policy Research in Washington, D.C.

Also

Project Syndicate
Cooperate with China or Suffer
Andrew Sheng, Distinguished Fellow of the Asia Global Institute at the University of Hong Kong and a member of the UNEP Advisory Council on Sustainable Finance, and a former chairman of the Hong Kong Securities and Futures Commission; and Xiao Geng, President of the Hong Kong Institution for International Finance, and a professor and Director of the Research Institute of Maritime Silk-Road at Peking University HSBC Business School







Two Definitions — Peter Radford

In recent weeks we have become accustomed to calling someone an ‘essential worker’. These are our most important people. They are, if the dictionary doesn’t lie, indispensable. They are extremely important. They are key, crucial, vital, and needed. They sound pretty darned special to me. They must be doing things that, were they not doing them, would bring the economy to a screeching halt.
My goodness, they must be paid a lot. Surely anyone who is a vital cog in the machinery is paid commensurately with that importance.
Not really. Not at all for most of them — the exception here in the U.S. being doctors. No, most of our ‘essential workers’ are amongst our least well paid....
The Radford Free Press
Two Definitions
Peter Radford

Bill Mitchell — ECB asset purchase programs are the only thing keeping Member States solvent

I haven’t had time yet to fully work through the decision by the European Commission yesterday to provide grants and loans to struggling Eurozone countries. I will comment on that when I have had time to understand the implications and be in a position to provide fair comment. It seems to be a vastly inadequately response in quantum, on top of an existing lack of fiscal support. But more on that another day. Today, I am investigating the latest data from the ECB. On May 26, 2020, the ECB released its bi-annual – Financial Stability Review, May 2020 – which seemed to excite some journalists to advance narratives that ‘sovereign debt’ investors (although none of the Eurozone nations are sovereign) will soon become spooked by the sharp rise in public debt levels in Europe, which will “threaten to undermine private-sector spending” and stall any growth prospects. The quote is from a Financial Times article (May 26, 2020) – ECB warns of challenge for eurozone from soaring public debt – which followed the release of the ECB’s Review. The elephant is, of course, the ECB assets and its ability to control all yields on public debt at will....
Bill Mitchell – billy blog
ECB asset purchase programs are the only thing keeping Member States solvent
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Rebel Wisdom - Conspiracy, Sensemaking & Truth. An Inquiry

Rebel Wisdom take a Jungian look at conspiracy theories. A myth in Jungian psychology doesn't mean something is untrue because it's not historically true: The story, or myth, is symbolic of a greater truth. Millions of people in the West feel they have been lied to by the establishment, so now they don't believe anything they say.

How can we make sense of the enormous changes going on in the landscape right now, as the growing crisis uproots everything we thought we knew.

Rebel Wisdom recently brought out a series of films about conspiracy and sensemaking, around the recent David Icke interviews on the channel London Real. They caused a huge, and hugely polarised reaction.

In this inquiry with Peter Limberg of the Intellectual Explorer's Club, Rebel Wisdom's David Fuller explores the topics raised by the films, and tries to make sense of the deeper questions they raise.



Wednesday, May 27, 2020

Bailout Watch


Continuing our new feature during the COVID shutdown:







Lefty morons call this a "bailout!"....



Moving Into The New "Normal" Brian Romanchuk


Cannada-centric.

Bond Economics

Pandemic Triggers Record $400 Billion Drop In Energy Investment — Tsvetana Paraskova


Energy units expended rather than currency units, as in GDP, are the true measure of productive economic activity. But energy investment is an indication of anticipated future direction.

Oilprice
Pandemic Triggers Record $400 Billion Drop In Energy Investment
Tsvetana Paraskova

$82 trillion over 5 years? Cambridge study counts the cost of coronavirus — Shalini Nagarajan


Worst-case scenario numbers.

ZH — Boeing Slashes 6,770 US Workers, Sees No Recovery In Air Travel For "Years"


Another ominous sign. Will the aircraft and airlines industries need a bailout?

Zero Hedge
Boeing Slashes 6,770 US Workers, Sees No Recovery In Air Travel For "Years"
Tyler Durden

Bill Mitchell — we remember the release of the 1945 White Paper on Full Employment

Some Wednesday snippets today. Tomorrow, I will write about what I have been thinking about the Eurozone. There has been a lot of hot air about the Franco-German accord that Emmanuel Macron and Angela Merkel came to recently. Hot air is the operative term. The fault lines in the Eurozone continue to widen and the policy dissonance is becoming more acute as they deal, not only with the health crisis, but also the 19 economies that have been starved of investment and infrastructure development. This Saturday (May 30, 2020) marks the 75th Anniversary of the release of the famous ‘White Paper on Full Employment’, which outlined the responsibilities that the Australian government took on to ensure there were jobs for all workers who were wanting work. This White Paper really defined the Post-WW2 consensus and began a period of low unemployment, upward social mobility, the development of public education and health, declining income and wealth inequality and stable wage shares as real wages kept pace with national productivity growth. It wasn’t nirvana because lots of issues were still in need of solutions (for example, gender attitudes, indigenous inclusion, etc). But it was a blue print for an inclusive society with growing material prosperity. The vision was abandoned sometime in the 1970s as neoliberalism took centre stage and political parties on both sides of the fence gave up talking about full employment. To restore full employment as a primary social goal and government responsibility is an agenda I have pursed all my career. We should all read the ‘White Paper’ and recast it in modern terms and fight like hell for a similar vision that is apposite for the times and crises we now face....
Bill Mitchell – billy blog
May 30, 2020 – we remember the release of the 1945 White Paper on Full Employment
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Tuesday, May 26, 2020

Germany Aims To Become World’s Hydrogen Hotspot — Vanand Meliksetia

The energy transition can be compared to a marathon instead of a sprint. As the costs of photovoltaic cells and wind turbines have significantly decreased, decarbonizing the economy has become attainable. The wealthier countries of northern Europe are, arguably, some of the most ambitious societies when it comes to the energy transition. Germany, especially, is an important country due to the size of its economy, political influence in Europe, and technological prowess. Hydrogen is an essential part of the strategy to become carbon neutral by 2050....
Oilprice

Neochartalists’ Rhetoric Against Raising Taxes — Ramanan


Policy choices.

My policy solution is that economic liberalism and political liberalism are incompatible. So-called capitalism (including  capital and land ownership) cannot coexist with genuine democracy as rule of, by and for the people based on egalitarian community. 

The economic system that corresponds with so-called capitalism is plutocratic oligarchy, for which there is ample evidence in sociology and political theory. The economic system that corresponds with genuine democracy as rule of, by and for the people based on egalitarian community is so-called socialism. 

Choice between them is a value judgment, and in actuality such choices are generally made based on power relationships in social groups.

I would define "capitalism" as the range of economic systems that favor capital over people, and "socialism" is the range of economic systems that favor people and the environment over capital (including  capital and land ownership). But the devil is in the details, especially since under the present configuration in most of the developed world, capital controls the power and determines institutional arrangements and application.

Considered as an analytical tool that studies various monetary systems and their economic and financial implications under different institutional arrangements, MMT is policy neutral, since it is chiefly descriptive.  

As an macroeconomic theory that prioritizes full employment, it is value-based. Prioritizing full employment favors workers (the majority of people in most societies) over capital (ownership of means of production and finance dominated by a few).

Other economic theories that claim to be more "naturalistic" do not make such an assumption but leave outcomes to so-called free markets in models that relegate government to the function of umpire with laissez-faire as the basic rule. However, privileging "naturalism" over, e.g., system regulation based on "control theory," is also a value judgment. Proponents of such systems view MMT as socialistic.

On the other hand, some critics argue that MMT economists in general assume a capitalist model and stay pretty in the box. 

The Case for Concerted Action
Neochartalists’ Rhetoric Against Raising Taxes
V. Ramanan

Unsanitized: A Few Weeks to Stop a Depression — David Dayan

We’re back from a holiday weekend but the Senate is still out of session, having left Washington without acting on more economic aid. The official line from Republicans is that it’s time to see how previous efforts work before considering more. And anyway, the economy’s opening back up, maybe it won’t need federal support.
This is a dangerously wrong attitude, especially because of the realities of the political calendar. Decisions will be made in the next few weeks that will put the nation on a direct path to depression without Congressional intervention.
That’s because the fiscal year for many states begins on July 1, and budgets must be adopted between now and then. California has a June 15 deadline for how to fill its giant budget hole, which could be as much as $54 billion. Other states scheduled to adopt a budget within this period include Colorado, Delaware, Georgia, Iowa, Kansas, Louisiana, Maine, Massachusetts, Michigan, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Vermont, and Wisconsin....
The folks in charge don't seem to appreciate systemic risk.

American Prospect

The Primary and Secondary Market Corporate Credit Facilities — Nina Boyarchenko, Richard Crump, Anna Kovner, Or Shachar, and Peter Van Tassel

On April 9, the Federal Reserve announced that it would take additional actions to provide up to $2.3 trillion in loans to support the economy in response to the coronavirus pandemic. Among the initiatives are the Primary Market and Secondary Market Corporate Credit Facilities (PMCCF and SMCCF), whose intent is to provide support for large U.S. businesses that typically finance themselves by issuing debt in capital markets....
Creditor of last resort.

FRBNY — Liberty Street Economics
The Primary and Secondary Market Corporate Credit Facilities
Nina Boyarchenko, Richard Crump, Anna Kovner, Or Shachar, and Peter Van Tassel 

Monday, May 25, 2020

Bill Mitchell – The Australia government is increasingly buying up its own debt – not a taxpayer in sight

In the wake of the $A60 billion bungle, the Australian government has turned its attention to creating smokescreens. Yesterday (May 25, 2020), the Treasurer released a statement – Temporary changes to continuous disclosure provisions for companies and officers – which effectively allows corporations to withold information from the public and investors about the state of their company finances. It will now be very hard to prove that company directors have mislead their investors. This is one of those thin end of the wedge trends that the Government has introduced under its emergency powers. For some time, the business peak bodies have been demanding the Government limit the capacity of shareholders to engage in class actions and for workers to pursue actions under industrial relations legislation (for example, QANTAS staff who have considered a class action against unsafe working conditions). But the point is that these diversions, which may or may not linger after the so-called 6-month sunset clause, take the pressure of the Government for their inept economic management, which is responsible for more than 2.4 million Australians (over 24 per cent of available workers) idle in one way or another. And when the question of economic management is raised we get a litany of lies reinforcing the fictional world that mainstream economists have created to prevent people from really understanding what the currency-issuing, Australian government can and cannot do. Today, I present some data on the RBA bond buying program and the way it is dovetailing with the debt-issuance activities of the Australian Office of Financial Management (AOFM). The Treasurer is in the National Press Club today and will spend his time lying about saving taxpayers’ money and reducing the debt burden for our grandchildren. Meanwhile 2.4 million Australians need more work....
Bill Mitchell – billy blog
The Australia government is increasingly buying up its own debt – not a taxpayer in sight
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Is The U.S. Prepared For War With China? — Gregory R. Copley


Some American strategy thinking.

Oilprice
Is The U.S. Prepared For War With China?
Gregory R. Copley via Defense and Foreign Affairs

Wang Shuo — Printing Money Is Not the Solution You Think It Is


The author exhibits zero understanding of actual MMT and criticizes a wildly mistaken stereotype. Not a good sign from China.

Caixin (PRC)
Wang Shuo: Printing Money Is Not the Solution You Think It Is
Wang Shuo | editor-in-chief of Caixin Media and Caixin Weekly

See also

However, this would count toward Wang Shuo's concern about the surge in central bank "money printing." While the understanding of the facts is wrong, the facts appear to be influencing expectations.

Zero Hedge
JPMorgan: The Surge In Gold Is A Sign Of Eroding Confidence In Central Bank-Generated Money
Tyler Durden

Zero Hedge — Goldman: The Default Cycle Has Started

Goldman writes this morning that with businesses shuttered and job losses mounting rapidly, "there is growing concern over the ability of borrowers to service their debt obligations and the resulting risks to financial stability."
In response, Goldman "assesses the likely scale of economy-wide credit losses, the exposure of creditors to those losses, and the potential risks to financial stability and the banking sector" to conclude that "rising bankruptcies and delinquencies suggest the default cycle has started."...
It didn't take a crystal ball. Without a swift V-shaped recovery, this could get ugly, giving "domino effect" new meaning.

Zero Hedge
Goldman: The Default Cycle Has Started
Tyler Durden

Russian researchers test coronavirus vaccine on THEMSELVES, team leader says they now have antibodies



The anti-vax, Covid-19, 5g, Bill Gates depopulation conspiracists say they would never take a vaccine. Many tell me I can have their one. But these scientists felt perfectly safe injecting themselves with a new vaccine they had developed.

Scientists in Russia have carried out the first unofficial trial of a Covid-19 vaccine – and they say it’s effective. Epidemiologists in Moscow took the unorthodox step of injecting themselves and examining their own results.

Russian researchers test coronavirus vaccine on THEMSELVES, team leader says they now have antibodies

Zero Hedge — Kim Jong Un Oversees Meeting To Increase NK's 'Nuclear War Deterrence'


Back from the dead.

Zero Hedge
Kim Jong Un Oversees Meeting To Increase NK's 'Nuclear War Deterrence'
Tyler Durden

TASS — Russia will not accept attempts to privatize the Moon, says Roscosmos CEO

Attempts to privatize the Moon run counter to international law, CEO of Russia's Roscosmos State Space Agency Dmitry Rogozin said in an interview with the Komsomolskaya Pravda radio station on Monday.
"We will not, in any case, accept any attempts to privatize the Moon. It is illegal, it runs counter to international law," Rogozin pointed out.
The Roscosmos CEO emphasized that Russia would begin the implementation of a lunar program in 2021 by launching the Luna-25 spacecraft to the Moon. Roscosmos intends to launch the Luna-26 spacecraft in 2024. After that, the Luna-27 lander will be sent to the Moon to dig up regolith and carry out research on the lunar surface....

Is Trump’s New Cold War Necessary? — Tom Luongo

Trump thinks he’s fighting a new Cold War against China but he’s really just fighting the next round in an old war on Asia that’s over 200 years old.
And it’s a war he cannot win.... 
Gold, Goats 'N Guns
Is Trump’s New Cold War Necessary?
Tom Luongo

See also

India Punchline
Iran surges in Venezuela in defiance of US sanctions
M. K. Bhadrakumar | retired diplomat with the Indian Foreign Service

Bill Mitchell – Dear Treasurer, I have a plan for your $60 billion

On Friday, we had the extraordinary admission from our Federal government that they had overestimated the injection required to fund their wage subsidy JobKeeper program by some $A60 billion. When the overall program was announced the Treasury allocated $A133 billion to it. So now they are admitting to a 45 per cent forecasting error, which sort of dwarfs the worst errors that the IMF makes, and they sure make some bad mistakes in their projections. Whatever the reason for the mistake, the way the Treasurer has defended it is quite repugnant – claiming virtue out of the incompetence. And while all the Labor Party economists are talking about seeing the error from space, none of them picked it up or had the nous to realise that the figures didn’t add up when the Government originally released them. I am the only economist who wrote that the figures published by the Government didn’t make sense. I did that on April 29, 2020. I also wrote to the Treasury and the Treasurer requesting answers to questions that reflected my concern. They didn’t bother replying. Now everyone is wise after the fact. Anyway, the $A60 billion is a nice round figure. And I outline a plan in this blog post on exactly how the Treasurer can spend it and improve the well-being of more than a million Australians with a stroke of the pen....
Bill Mitchell – billy blog
Dear Treasurer, I have a plan for your $60 billion
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Sunday, May 24, 2020

Caitlin Johnstone — China Derangement Syndrome: Notes From The Edge Of The Narrative Matrix

Friendly reminder that we’ve invented weapons which can end all life on earth and we’re in steadily increasing danger of setting them all off because some guys in a think tank wrote some words....
Caitlin Johnstone — Rogue Journalist
China Derangement Syndrome: Notes From The Edge Of The Narrative Matrix
Caitlin Johnstone

Zero Hedge "The Comments Are Highly Important" [Goldman]: China's Xi Reportedly Indicated Desire To Avoid Strong Stimulus

Overnight, Goldman confirmed as much, writing that President Xi participated at group discussions at the Two Sessions on Friday, with some of his comments reported on Saturday. Notably he said if it were not because of the pandemic, the growth target would be set at around 6%. He added that a global recession is guaranteed, and given this, if a numerical target (implicitly at a relatively high level) was set, it would require a strong stimulus and the focus of the government would be on the growth rate. He said the focus should instead be on the "six stabilities" and "six guarantees" in six areas — the pursuit of these goals will indirectly contribute to GDP growth but the latter should not be the focus of the government, according to the report....
Zero Hedge
"The Comments Are Highly Important": China's Xi Reportedly Indicated Desire To Avoid Strong Stimulus
Tyler Durden

The science behind human irrationality just passed a huge test — Cathleen O'Grady


Behavioral economics vindicated.

This 1979 Kahneman-Tversky study and its contemporary replication is about loss aversion. There are many, many more cognitive-affective biases affecting rationality. There is also illogic, since most people are not trained in either critical thinking or rigorous scientific method, and mathematical innumeracy is high, especially when the long term is included, as it is in many economists' assumptions about rationality and maximization.

Then there is connotation of terms in addition to denotation, where the connotation carries an emotional charge. Persuasion — real advertising, PR and propaganda — are based on this.

People also often choose and act against their own assumed "better" interests eg., economic interests, since interest is determined by values and people often hold a value system that subordinates one set of interests, e.g., economic, to another, e.g., social, political, cultural or religious.

The assumption that humans are "rational agents" in the sense that economists understand the term, which focuses exclusively on economic interest, is not a truism as supposed. The evidence shows this.

Ars Technica
The science behind human irrationality just passed a huge test
Cathleen O'Grady

Related

Fuzzy logic and fuzzy sets  address this issue.

Statistical Modeling, Causal Inference, and Social Science
“Banishing ‘Black/White Thinking’: A Trio of Teaching Tricks”
Andrew Gelman | Professor of Statistics and Political Science and Director of the Applied Statistics Center, Columbia University

See also

Evonomics
Evidence for Tribalism in Economics
Blair Fix /

"Dr. Doom" At IT Again: Predicts 10-Year Depression — J. Barkley Rosser


Barkeley Rosser says to take Roubini with a grain of salt, but only a grain, since he makes some important points. I am in agreement with that. Both optimism and pessimism need to be tempered with realism, and reality is fraught with uncertainty owing to human decisions that affect conditions. And just as the weather is relatively uncertain other than short term, reality has a way of delivering "exogenous shocks." So the watchword should be "caution." That is not a meme or mantra of this administration. Forking paths ahead?

Econospeak
"Dr. Doom" At IT Again: Predicts 10-Year Depression
J. Barkley Rosser | Professor of Economics and Business Administration James Madison University

Pamela Yellon - Death by Investing: How a 10 Percent Loss Raises Mortality Levels

Stock market declines are linked to early death, illness, and fatal accidents. Are you at risk?




This is what bothers me about the Lockdown, could it kill more people than Covid-19 in the long run?

Losing money in the stock market can cost you your life, and I'm not just talking about the old cliché of people jumping out of skyscraper windows when markets crash.


In fact, people with as little as 10 percent of their wealth in the stock market who experience a 10 percent loss stand an increased risk of dying early or suffering health problems such as high blood pressure and depression.

That’s according to a study published in the American Economic Journal, which looked at booms and busts in the U.S. stock market between 1998 and 2011. In the study, Hannes Schwandt, assistant economics professor at the University of Zurich Department of Economics, determined that what he called “wealth shocks” strongly affect health outcomes.

Entrepreneur

Pamela Yellon - Death by Investing: How a 10 Percent Loss Raises Mortality Levels

Saturday, May 23, 2020

Zero Hedge — Bankruptcy Tsunami Begins: Thousands Of Default Notices Are "Flying Out The Door"


Risk of debt-deflation taking hold?

Zero Hedge
Bankruptcy Tsunami Begins: Thousands Of Default Notices Are "Flying Out The Door"
Tyler Durden

See also

Zero Hedge
Tracking The Recovery: What Real-Time Data Says About The State Of The Global Economy
Tyler Durden

VIPS MEMO: To the President—Avoid Hostilities Over Iranian Fuel Shipment to Venezuela

The Veteran Intelligence Professionals for Sanity (VIPS) urges Donald Trump to avoid the slippery slope toward armed conflict as an Iranian oil tanker nears Venezuela on Sunday....
Consortium News
VIPS MEMO: To the President—Avoid Hostilities Over Iranian Fuel Shipment to Venezuela
May 22, 2020

If the rich knew what tax was for they might actually appreciate it… — Peter May


Worth a read in full, so no spoilers.

Progressive Pulse
If the rich knew what tax was for they might actually appreciate it…
Peter May

Bitcoin’s Shocking Energy Consumption — Haley Zaremba

When it comes to thinking about which economic sectors and industry niches that consume the most energy, cryptocurrencies may not immediately come to mind. But for some of these crypto companies, their energy and carbon footprints are not just considerable, they’re massive. The most famous example, Bitcoin, has an annual energy footprint slightly larger than the entire nation of Switzerland. The company’s current energy consumption can be tracked here.
Last year, the University of Cambridge created an online tool that allows users to compare the boggling energy consumption of Bitcoin to other entities. At the time that this platform debuted, the tool estimated that “Bitcoin is using around seven gigawatts of electricity, equal to 0.21% of the world's supply,” according to a BBC report. This shocking figure translates to “as much power as would be generated by seven Dungeness nuclear power plants at once.”...

China: one country, two sessions, three threats — Pepe Escobar

It’s absolutely essential to position the Two Sessions [of the 13th National People’s Congress] within the larger, incandescent geopolitical and geoeconomic context of the de facto new Cold War – hybrid war included – between the US and China....
The great game is still about who controls the Eurasian land mass as the center of the "world island," set forth by British strategist Halford Mackinder, and the "rimland," proposed by Nicholas J. Spykman. These doctrines were the basis of the strategies respectively put forward by Republican Henry Kissinger and Democrat Zbigniew Brzezinski.

The contest pits the great land powers, Russia and China, against the great sea powers, the US and UK,  as traditional enemies. To win this contest, the US and its allies would need to pry Russia and China apart, which is highly unlikely at this point. In order to prevail as undisputed hegemon, the must defeat both Russia and China either separately or together.

While Brzezinski was implacably anti-Russian, Kissinger realized that the US was betting the farm on defeating a Sino-Russian alliance. As result, he convinced Nixon to reach out to Mao. (Secretary of the Treasury John Connally convinced Nixon to shut the gold window for international trade). Trump was acting on Kissinger's advice in his approach to Russia, but the deep state and Democratic Party turned that into Russiagate.

Asia Times
China: one country, two sessions, three threats
Pepe Escobar

Also

Oriental Review
The 13th National People’s Congress of China
Zamir AWAN

also

Like China doesn't realize this. This is what the "Uyghur concentration camps in Xi'an" and "Hong Kong dissent suppression" propaganda memes are all about. Does China have entirely clean hands in this? Hard to tell what is really going on there, but regardless, the memes are being exploited.

Bill Totten's Weblog

The US is Trying to Dismember China by Promoting Separatism in Its Regions

Russia, China won’t accept US nuclear superiority — M. K. Bhadrakumar


The arms race is on. And further reason for Russia and China to enter into a closer military alliance to counter the US and its allies. The world is splitting economically, politically and militarily into opposing camps again, which is doubly dangerous in difficult economic times. Liberal globalization is on hold for the foreseeable future, as the rivalry between liberalism and traditionalism heats up.

India Punchline
Russia, China won’t accept US nuclear superiority
M. K. Bhadrakumar | retired diplomat with the Indian Foreign Service

See also

Moon of Alabama
U.S. Threatens New Nuclear Tests To Push China Into A Treaty It Does Not Want



Blog: Chinese Economists Clash Over Monetization of Fiscal Deficit, Special Treasury Bonds — Zhang Qizhi and Gavin Cross


Strongly suggests that Chinese policy makers are not on board with the MMT approach and are resistant to it because (neoliberal) "fiscal discipline." So much the worse for China.

Caixan
Blog: Chinese Economists Clash Over Monetization of Fiscal Deficit, Special Treasury Bonds

Joan Robinson On Michal Kalecki’s Claim To Priority— Ramanan


Kalecki made the mistake of writing in Polish. Otherwise, we would be talking about Kaleckianism rather than Keynesianism.

The Case for Concerted Action
Joan Robinson On Michal Kalecki’s Claim To Priority
V. Ramanan

Car rental giant Hertz files for bankruptcy as its vehicles remain idled by pandemic — John Solomon

Car giant was already saddled with debt before COVID-19 struck.
Anomaly, or indication of systemic risk owing to debt?

Just the News
Car rental giant Hertz files for bankruptcy as its vehicles remain idled by pandemic
John Solomon

See also

It's not just a matter of reopening. Will the customers be there?

BBC
Coronavirus: Leading economist warns of 10 years of depression and debt
Karishma Vaswani interview with Nouriel Roubini

John Quiggin — MWW on MMT (from Twitter via Spooler)

Mitchell, Wray and Watts Macroeconomics p 323, give a the correct version of the #MMT position on budget aggregates ....
John Quiggin's Blog
MWW on MMT (from Twitter via Spooler)
John Quiggin | Professor and an Australian Research Council Laureate Fellow at the University of Queensland, and a member of the Board of the Climate Change Authority of the Australian Government

Friday, May 22, 2020

The Incoherence Of Yield Curve Control Brian Romanchuk

Yield curve control -- setting bond yields by the central bank -- has returned to discussion. Mainstream economics over-emphasises the role of interest rates in guiding the economy, and based on previous experience, it seems entirely likely that some form of new policy will be attempted to counter-act economic weakness. The main options appear to be negative interest rates and yield curve control, and it seems clear that Fed officials prefer yield curve control to negative rates, Yield curve control will either accomplish very little, or be viewed as a mistake in retrospect. That said, it is still a more sensible policy that large scale purchases of Treasurys by the Fed (Quantitative Easing)....
Important post on MMT, monetary policy and conventional beliefs, attitudes and expectations.
Barring a miracle cure for COVID-19, the United States is drifting into a multi-year period of extremely depressed activity. There does not appear to be capacity to eradicate the virus, nor are older consumers or office workers willing to take meaningful health risks to benefit capitalism. Unless there is a magical transformation in the attitudes of the ruling elites, the fiscal policy response will remain reactive, and ineffectual. The Fed is the only entity in the United States that takes any responsibility for the effectiveness of policy, and so we should expect to see greater leaps in its policy framework.
Although yield curve control is the most likely next step, negative interest rates cannot be ruled out. Health worries might strengthen the hand of those advocating the abolishing of paper money, removing one institutional barrier to negative interest rates.
Bond Economics

Asian century began in May 2020 — David P. Goldman

Economic historians may date the start of the Asian century to May 2020, when most Asian economies bounced back to full employment while the West languished in coronavirus lockdown. Asia has emerged as an economic zone as closely integrated as the European Union, increasingly insulated from economic shocks from the United States or Europe.... 
Asia Times
Asian century began in May 2020
David P. Goldman

Thursday, May 21, 2020

RT — ‘We’ll spend you into oblivion’: US nuclear envoy reveals ‘negotiating’ tactic for New START, last arms control deal with Russia


Trump goes full Reagan.

Apparently the US doesn't realize that the real cost is in terms of real resources rather than units of account for countries that issue their own currencies. Or maybe it does and wants to force China to drop its dollar peg like Russia.

Whatever, it's nutty. Kind of like declaring that the US is staying in Syria to create a quagmire for Russia.

Where are the grownups?

Oh, and did I mention that the latest talking point is the Social Security is running out of funding soon so that the program needs to be cut.

RT
‘We’ll spend you into oblivion’: US nuclear envoy reveals ‘negotiating’ tactic for New START, last arms control deal with Russia

See also

Sputnik International
US Militarizing Space, Exiting Treaties in ‘Historical Miscalculation’ to Stay Hegemon

Also

Ray Dalio concerned.

Zero Hedge
"Revolutions And Wars": What According To Ray Dalio Comes After "Printing Money"
Tyler Durden

THE AUSTRALIAN CHEWING-GUM IS NOW ON THE RUSSIAN SHOE – AUSTRALIAN MINISTER ASKS LAVROV TO SAVE EXPORTS FROM CHINESE SANCTIONS; LAVROV ASKS FOR AUSTRALIAN SUPPORT TO STOP FAKE MH17 EVIDENCE IN DUTCH SHOW TRIAL — John Helmer

One day after Australia was defeated at the World Health Assembly in a joint effort with the Trump Administration to attack China, and after Beijing retaliated, calling the Australian Government a US puppet, a joke, and chewing-gum on China’s shoe, Australia has telephoned Moscow for help. In a call initiated by Foreign Minister Marise Payne (lead image, left), Foreign Minister Sergei Lavrov was asked to boost Russian imports from Australia and send more Russian tourists to the country.
Lavrov replied that Australia should stop fabricating evidence of Russian involvement in the shoot-down of Malaysia Airlines flight MH17, and withdraw from the Dutch show trial which is scheduled to resume hearings in Amsterdam next month....
Dances with Bears
THE AUSTRALIAN CHEWING-GUM IS NOW ON THE RUSSIAN SHOE – AUSTRALIAN MINISTER ASKS LAVROV TO SAVE EXPORTS FROM CHINESE SANCTIONS; LAVROV ASKS FOR AUSTRALIAN SUPPORT TO STOP FAKE MH17 EVIDENCE IN DUTCH SHOW TRIAL
John Helmer

As debt soars, the cost of servicing it keeps falling

Good news for the British government’s finances


An awful lot has changed since Rishi Sunak, the chancellor, unveiled his budget in March. Britain’s economy looks set to experience an unprecedentedly rapid and deep recession. What is more, the government, through actions such as the furlough scheme to support employment, is choosing to bear an unusually large share of the initial costs. The result will be much higher government debt than previously anticipated. And yet the actual cost of servicing that higher debt may well turn out to be lower than was expected back in March.

There is now so much uncertainty that the official government forecasters—the Office for Budget Responsibility (obr) and the Bank of England—have declined to issue their usual forecasts, instead presenting what they call “scenarios”. More detailed modelling by the Resolution Foundation shows what may be to come. According to the think-tank’s three-month lockdown estimate, the debt-to-gdp ratio will soon head back to the 100% mark—a level not seen since the 1950s, when Britain was still burdened with the costs of fighting the second world war.

The Economist

8 logical fallacies that are hard to spot — Steven Johnson


Recognize any of these in economic discourse?

Big Think
8 logical fallacies that are hard to spot
Steven Johnson
ht Yves Smith at Naked Capitalism

Bill Mitchell – Britain confounding the macroeconomic textbooks – except one!

Remember back just a few months ago. We are in Britain. All the Remainers are jumping up and down about Brexit. We hardly see anything about it now as the UK moves towards a no deal with the EU. Times have overtaken all that non-event stuff. Now the developments are confounding the mainstream economists – again. There will be all sorts of reinventing history and ad hoc reasoning going on, but the latest data demonstrates quite clearly that what students are taught in mainstream macroeconomics provides no basis for an understanding of how the monetary system operates. All the predictions that a mainstream program would generate about the likely effects of current treasury and central bank behaviour would be wrong. Only MMT provides the body of knowledge that is requisite for understanding these trends....
Bill Mitchell – billy blog
Britain confounding the macroeconomic textbooks – except one!
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Definitions and Debate — Definitions and Debate Regan Ferrell interviews Jeffrey Miron and Michael Hudson

Regan: Hello everyone, thank you for tuning into this episode of the Knowledge Problem Podcast. I’m your host Regan Ferrell [and I’m Alex Pilkington] on today’s episode we explore the merits and shortcomings of capitalism. [1:00] We have Dr. Jeffrey Miron speaking first, followed by rebuttals from Dr. Michael Hudson....
Michael Hudson — On Finance, Real Estate And The Powers Of Neoliberalism
Definitions and Debate
Regan Ferrell interviews Jeffrey Miron, senior lecturer and director of undergraduate studies in the department of economics at Harvard University as well as a senior fellow at the Cato Institute, and Michael Hudson, President of The Institute for the Study of Long-Term Economic Trends (ISLET), Distinguished Research Professor of Economics at the University of Missouri, Kansas City, and Guest Professor at Peking University

Muslim Chinese Street Food Tour in Xi'an, China | BEST

C J Werleman is putting out anti-China propaganda on Twitter, and Nafeez Ahmed sometimes does this too. Both are excellent journalists in every other way.

CJ Werleman says the Chinese government is forcing Xinjiang Muslims to eat pork and drink alcohol. This is total rubbish as it would greatly backfire. They would have a revolution on their hands.

Uyghur students forced to eat pork, Muslims required to drink before entering mosques, C J Werleman 

A Chinese person sent me this video.

Tweet

This video exposing "extreme oppression of Muslim food culture" has received over 1 mil views on youtube! It's just terrible!

Muslim Chinese Street Food Tour in Xi'an, China | BEST Muslim Chinese Cuisine in China





Muslim Chinese Street Food Xi'an - Chinese Street Food - Best Muslim Street Food China
Muslim Chinese street food and Chinese Food is delicious in China! I flew to Xi'an, China and have been eating street food and dumplings non stop. Best Street Food I've tasted in China, maybe even best street food in Asia! The Chinese food is so good in Xi'an! I've eaten street food in Bejing, street food in Shanghai,, and street food in Chengdui, all of which has been amazing, but I have to say that the chinese street food in Xi'an has been some of the best!

Wednesday, May 20, 2020

TASS — Putin: Russia is now fully self-sufficient in basic food products


National self-sufficiency is the new target. Russia was able to achieve this owing to sanctions. According to Putin, without sanctions it would have been impossible politically.

TASS
Putin: Russia is now fully self-sufficient in basic food products

TRUTH VACCINE KILLS AUSTRALIAN-AMERICAN CAMPAIGN AGAINST CHINA IN WORLD HEALTH ORGANISATION DEBATE — John Helmer


Longish, but interesting if following this.

Dances with Bears
TRUTH VACCINE KILLS AUSTRALIAN-AMERICAN CAMPAIGN AGAINST CHINA IN WORLD HEALTH ORGANISATION DEBATE
John Helmer

May 20 COVID-19 Test Results, AND Great News on the Next Step — Bill McBride


With testing ramped up, some numbers are coming in.

CR
May 20 COVID-19 Test Results, AND Great News on the Next Step
Bill McBride

Update: The World's Simplest Bond Model — Brian Romanchuk

I ran across a comment to the effect that Modern Monetary Theory (MMT) somehow is missing a theory of interest rates....
Bond Economics
Update: The World's Simplest Bond Model
Brian Romanchuk

South America Won the U.S.-China Trade War

Two economists calculate that U.S. farms lost $14 billion because of retaliatory tariffs, while South American countries boosted their exports by $13 billion to fill the gap.


The trade war may not have turned out to be "good and easy to win" for the United States, but some other countries have benefited from how higher tariffs have warped the global flow of agricultural goods. Argentina, Brazil, and Chile were the "primary beneficiaries of the retaliatory tariff increases," Carter and Steinbach write, because they "were able to substantially expand their trade with retaliatory countries at the cost of the United States."

Reason.com

Poetic truths from a leading economist: 'from crisis stems great renewal' — James Nason

In a keynote address to the Alltech One virtual global conference last night Australian-time, Mr McWilliams, an internationally renowned speaker and one of the world’s most influential economists, drew from the work of his countryman WB Yeats to illustrate how previous periods of crisis have historically led to great renewal.

“When I worked in the Central Bank in Ireland, if you’d told me that the Federal Reserve was going to buy government bonds directly, was then going to buy corporate bonds directly, and then last Thursday, it says we’re going to buy junk bonds and we’re going to take those off the balance sheets of the banking system and we’re going to give the banking system cash and the banks can lend out that, I would have said, that ‘ain’t going to happen’.
“And the funniest thing is it’s happened in the last two weeks and nobody said a word.
“Why? Because everybody realises that this shift is coming.”
– ‘Modern monetary theory’ gaining momentum: Faced with a choice between abandoning their dogma or moving into another Great Depression, monetary authorities in the United States and Europe were choosing to spend their way out by underwriting incomes and bailing out industries, and electing to worry about potential inflationary consequences in the future.
The US and Europe were in “a sort of a deflationary death spiral” that could potentially “drag us all into a depression” which could go on for a long time if monetary authorities don’t actually step up to the plate. However Mr McWilliams said he believed they are stepping up.
In the United States which has full monetary autonomy and its own currency and is facing a Presidential election later this year, the Democratic side of politics is coalescing around support for modern monetary theory, the notion of printing money to solve a country’s problem (a concept that many traditional economists have issues with).
2020 opened with the expectation the US would experience a presidential election against a backdrop of lowest level of unemployment ever. It will now be held against a backdrop of the highest unemployment ever, currently standing at 28 percent.
“That is the only story” Mr McWilliams said. “Once your unemployment goes to that level, then all bets are off. All ideology’s out the window, and you’ve got to get folk back to work.”
Mr McWilliams said it would be critical for the US under this approach to protect its “productive capacity” to avoid hyperinflation, such as that which beset Germany after World War I and Zimbabwe when productive farming land was taken from farmers under the Mugabe regime.
In order to achieve aim that he said key MMT proponents such as economist Stephanie Kelton, a senior Democratic economic advisor, are promoting the idea of using Government money now to build and expand the capacity of the US economy to reduce the chances of having inflation.
“I would agree with that, simply because I think we’re moving into a deflationary world. If rates of unemployment in certain states are as high as they seem to be ticking up every day, that’s not an environment where prices rise. That’s an environment where prices fall.”
Beef Central (Australia)
Poetic truths from a leading economist: 'from crisis stems great renewal'
James Nason

Bill Mitchell — MMTed

MMTed Q&A
The questions are rolling in – thanks – and we will begin our program next Wednesday (May 27, 2020).

As part of the on-going development of our MMTed project, we are introducing – MMTed Q&A – which will be a weekly live program screening on Wednesday nights starting at 20:00 Australian EST.

This will be at:

10:00 Dakar
11:00 London
12:00 Paris
13:00 Helsinki
19:00 Tokyo, Kyoto and Dili
03:00 San Francisco
06:00 New York

The program will run for 30 minutes each week and the format will be around 5 questions will be answered with discussion.

Each week, we plan to bring in some of the MMT experts who can help answer your questions.

If you want to ask a question the process, as a trial, will be to submit your enquiry via the – MMTed Q&A – page.

We do not guarantee that your question will be answered but we will do our best.

Only submissions will valid E-mail addresses will be accepted.

The links to the live stream each week will be published in advance on the site and via Twitter and on this blog site.

Call for MMTed Support
We are making progress in developing the program that will become – MMTed.

But we still need significant sponsors for this venture to ensure that we can run the educational program with negligible fees.

If you are able to help on an ongoing basis that would be great. But we will also appreciate of once-off and small donations as your circumstances permit.

You can contribute in one of two ways:

1. Via PayPal – which is our preferred vehicle for receiving donations.

The PayPal donation button is available via the MMTed Home Page or via the – Donation button – on the right-hand menu of this page (below the calendar).

2. Direct to MMTed’s Bank Account.

Please write to me to request account details.

Please help if you can.

We cannot make the MMTed project viable on a sustainable basis without funding support.

We will always maintain strict anonymity with respect to donations received, except if the donor desires to be publicly associated with the venture and gives their permission in writing to appear on the Donors Page.

Bill Mitchell – Progressives still speak the language of the neoliberals but then dream of change

Its Wednesday, so a collection of snippets, ads and music. One of the things I am working on as part of my book venture with Thomas Fazi, our followup to – Reclaiming the State: A Progressive Vision of Sovereignty for a Post-Neoliberal World (Pluto Books, September 2017) – is the way the Left and Right are responding to the current crisis. It is clear to me that the Right are seeing it as a way to really entrench new beach head gains on their long term agenda to divert public spending away from general welfare towards the top-end-of-town and to use the legislative/regulative structures of government to further their aims to divert more of the national income produced towards capital, particularly financial capital. Meanwhile, it looks as if the Left has gone to asleep – or better – they haven’t really woken from their long-term slumber as they dream their standard narrative that global capital has made the state unable to pursue independent fiscal agendas that will improve the lot of all humanity. So I am looking into that sort of narrative and collecting evidence as one does to compile into a coherent argument.
Bill Mitchell – billy blog
Progressives still speak the language of the neoliberals but then dream of change
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Trump New Press Secretary


Trump locking in the Evangelical vote (BIG!):





DTs:






Powell Sees Little Reason to Fret Over Fed Balance-Sheet Growth


LOL well not anymore he doesn't.. or not at least until March 2021...




Tuesday, May 19, 2020

KV - Oh, to be young again!

Only kidding, I don't think I would have ever been up for this. I can only think these guys are from an elite crack military unit.


US Threatens to Prevent Iranian-Venezuelan Mutual Assistance — William Camacaro, Frederick B. Mills, Danny Shaw

As Carmen Parejo Rendón observes “what the US does not realize is that it keeps creating more enemies for itself and with this it is reinforcing multilateralism.”
Internationalist 360º
US Threatens to Prevent Iranian-Venezuelan Mutual Assistance
William Camacaro, Frederick B. Mills, Danny Shaw

Merrill: "Most of the slowdown occurred due to voluntary social distancing rather than lockdown policies" — Bill McBride

This is an important note and suggests the economy is dependent on the course of the pandemic.
Expectations.


Related at CR

May 19 Update: US COVID-19 Test Results

Sputnik — Nokia Says Broke 5G World Speed Record

Nokia has set a new world record for the 5G speed, registering 4.7 billions of bits per second (Gbps) on a US operator's network in Dallas, the Finnish telecommunications company said on Tuesday.
Latest from the technology wars.

RT — Study Trump cited in his latest attack on WHO does NOT EXIST, says editor-in-chief of prestigious medical journal

“This statement is factually incorrect,” the Lancet said in a statement referring to Trump’s claims and allegations, which the journal described as “damaging to the efforts to strengthen international cooperation to control the pandemic.”
Oops.

RT
Study Trump cited in his latest attack on WHO does NOT EXIST, says editor-in-chief of prestigious medical journal