Wednesday, November 30, 2022

Germany’s Largest State Declares Emergency Amid Energy Crisis — Tsvetana Paraskova

Westphalia, the biggest state in Germany in terms of economy and population, has declared an emergency situation amid the energy crisis in order to be allowed to take on more debt. North Rhine-Westphalia (NRW), home to 20 of the 50 largest German companies, declared an “extraordinary emergency situation” to be able to access more loans which would otherwise be denied to the state because of a rule on how much debt a state can borrow, German broadcaster WDR reports....
Oilprice
Germany’s Largest State Declares Emergency Amid Energy Crisis
Tsvetana Paraskova

Andrew Batson — The Jiang Zemin Consensus

Former Chinese leader Jiang Zemin, who died Wednesday at the age of 96, managed to be underestimated for most of his life, despite rising to exalted heights. He was not considered an inspiring figure when Deng Xiaoping plucked him from Shanghai to run the government after the 1989 purge, and in accounts of the pivotal economic reforms of the 1990s he is often overshadowed by the charismatic and decisive Zhu Rongji.

Yet looking back, it seems clear that Jiang was responsible for establishing many of the basic political and economic contours of contemporary China.…
A short look at one of the key players in Deng's reforms that led to the fact pace of China's development over the past forty years.

Andrew Batson's Blog
The Jiang Zemin Consensus
Andrew

We are interwoven beings — Mercedes Valmisais

 Individualism (West) versus the systems approach (East). Which will win?

Another major difference is the emphasis on abstract principles (West) versus situational awareness (East).

Another, related to the above, is the difference between ideology and practicality.

This article, while interesting, is written from a Western mindset in that the author seems to lack experience of the East. In the West this is usually displayed by those that have practiced Oriental martial arts or pursued Eastern approaches to spirituality. So while capturing the ideas intellectually, it misses the mark experientially. 

Arguably, many in the East do not follow their own teachings in the depth needed to developing the experience needed to grok* the teaching in its profundity. But participation in the culture conveys a modicum of that that the culture of the West not only does not but for the most part rejects, although that has been changing since the Sixties.

Incidentally, Caitlin Johnstone is a commentator, author and poet, who exhibits these characteristics and whose work is based on it.

Aeon
We are interwoven beings
Mercedes Valmisais | assistant professor in the Department of Philosophy at Gettysburg College in Pennsylvania and author of Adapting: A Chinese Philosophy of Action (2021).

* h/t Robert Heinlein, in Stranger in a Strange Land

The Global South births a new game-changing payment system — Pepe Escobar

The Eurasia Economic Union (EAEU) is speeding up its design of a common payment system, which has been closely discussed for nearly a year with the Chinese under the stewardship of Sergei Glazyev, the EAEU’s minister in charge of Integration and Macro-economy.

Through its regulatory body, the Eurasian Economic Commission (EEC), the EAEU has just extended a very serious proposal to the BRICS nations (Brazil, Russia, India, China and South Africa) which, crucially, are already on the way to turning into BRICS+: a sort of G20 of the Global South.

The system will include a single payment card – in direct competition with Visa and Mastercard – merging the already existing Russian MIR, China’s UnionPay, India’s RuPay, Brazil’s Elo, and others.

That will represent a direct challenge to the western-designed (and enforced) monetary system, head on. And it comes on the heels of BRICS members already transacting their bilateral trade in local currencies, and bypassing the US dollar.…

De-dollarization picking up steam. 

In addition, the Global South/East is integrating as a competitive rival (BRICS, EAEU, SCC, BRI) to the Global North/West (G7, NATO, Western-controlled international financial institutions like the IMF and World Bank). Parallel systems in a bipolar world are developing.

Pushing further on down the road, the recent pathetic metaphor coined by a tawdry Eurocrat boss: the “jungle” is breaking away from the “garden” with a vengeance.…

In ancient Greece a distinction was drawn between (Greek) civilization, barbarism (non-Greek civilization), and savagery (tribalism). In the colonial era the distinction was between the West and "the white-man's burden," meaning the undeveloped colonies that were being exploited. That game is ending.


See also
The top takeaways from this analysis are several. First, Russia’s energy geopolitics with China and India are mutually beneficial. Second, China’s energy diversification strategy is being balanced out by India’s insatiable appetite for discounted Russian resources. Third, India is rapidly replacing China as Russia’s top partner. Fourth, neither the aforesaid nor the ongoing Sino-American discussions over a New Détente are zero-sum for Moscow or Beijing. And finally, a new global strategic balance is emerging.
Andrew Korybko's Newsletter
Andrew Korybko

See also
In our new Hobbesian world, a world of competing economic zones, Europe’s first goal should be to achieve strategic economic autonomy. But is that goal attainable anymore when its energy security that gave underpinning to its prosperity and industrial might has been smashed to smithereens in the depths of the Baltic Sea by unseen hands? …
Meanwhile, Europe too is struggling with its demons — unable to shake off the idea of a price cap on Russian oil that is sure to boomerang and further aggravate Europe’s energy security; need to step up imports of LNG from Russia still, which is far cheaper than from America; Europe not being in a position to respond to the launch of the highly consequential inflation reduction act in the US or migration of European industry to America; EU’s inability to strengthen the international role of the euro for absorbing some of the world’s surplus savings, and so on....
India Punchline
Conflict in Ukraine is doomed to escalate
M. K. Bhadrakumar | retired diplomat with the Indian Foreign Service and former ambassador


Bill Mitchell – RBA governor apologises for duping Australians – but then says we didn’t read the literature closely enough

It’s Wednesday and I am reverting to my usual pattern of discussing a few items in less detailed form and including some music to lighten the load. Today we consider the apology that the RBA governor issued to mortgage holders that the central bank duped. We also consider the question of what is ‘normal’ in a pandemic. And more....
Bill Mitchell – billy blog
RBA governor apologises for duping Australians – but then says we didn’t read the literature closely enough
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Tuesday, November 29, 2022

Matt Stoller — Why Is Booz Allen Renting Us Back Our Own National Parks?

 Mostly about Henry George and land as a factor.

BIG by Matt Stoller
Why Is Booz Allen Renting Us Back Our Own National Parks?

Russia, China set to create payment system without using SWIFT — Deputy PM Alexander Novak

Russia and China are working on a reciprocal opening of company accounts to avoid the use of SWIFT, Russian Deputy Prime Minister Alexander Novak said on Tuesday. He was speaking at the 4th Russian-Chinese Energy Business Forum.

Novak recalled that payments under contracts for gas supplies from Russia to China are already switching to the national currencies of the two countries. Besides that, settlements for supplies of oil, petroleum products and coal are being actively transferred in rubles and yuan, he added....
TASS (Russian state media)
Russia, China set to create payment system without using SWIFT — Deputy PM

Moon of Alabama — More On The Crypto Scam - "There's A Sucker Born Every Minute."

Moon of Alabama wades in on FTS and SBF.

Moon of Alabama
More On The Crypto Scam - "There's A Sucker Born Every Minute."

Dollar Dominance is Financial Dominance — Orsola Costantini

What Strategies can Break This Dependency?
The dollar system has proven resilient in the face of recent extreme and unexpected shocks, but it has also failed to foster sustainable growth and prosperity. Can it survive its contradictions? Evidence from the latest Trade and Development Report of UNCTAD suggests better South-South and commodity producers-consumers agreements are needed, on the way to a more inclusive international monetary system.
INET
Dollar Dominance is Financial Dominance
Orsola Costantini, Economic Affairs Officer​, UNCTAD

Brazil and Argentina Just Agreed to Use Local Currencies for Bilateral Energy Trade, In Yet Another Snub for US Dollar — Nick Corbishley

Another step toward de-dollarization. How, as Nick Corbishley, this is not the final goal, which is the establishment of a new monetary system that ushers the Global South/East into the club from which the current arrangements not only exclude them but also submit them for control. This will take time and the process is not yet clear enough to be foreseeable.

Naked Capitalism
Brazil and Argentina Just Agreed to Use Local Currencies for Bilateral Energy Trade, In Yet Another Snub for US Dollar
Nick Corbishley

Supply-side inflation and its cures — David P. Goldman

 Longish and lots of numbers. Refers to Jan Haztius. Anti-monetarist, sort of.

Asia Times
Supply-side inflation and its cures
David P. Goldman

Monday, November 28, 2022

Breaking Down the Market for Misinformation — Gonzalo Cisternas and Jorge Vásquez

Assumes (tacitly) 1) that objective "fact-checking" is possible to achieve and 2) that a majority of consumers of information will deem the so-called fact-checking credible. 

Both of these implicit assumptions seem questionable evidential  in light of mistakes and anecdotally (based on responses when sending people to purported fact-checking sites).

New words addressing this have become internet memes, like "truthiness" and "gaslighting."

Liberty Street Economics
Breaking Down the Market for Misinformation
Gonzalo Cisternas and Jorge Vásquez

Deceiving people using monetary affordability —— Peter May

Sunak has proclaimed, according to the BBC, “Where we are now is that the unions are asking for a 17% pay rise – and I think most people watching will recognise that clearly that’s not affordable”.

Most people if they do recognise this, have, of course, been brainwashed and I’m beginning to conclude that it is remarkable that the people can be lied to and deceived with such breathtaking confidence by our ruling elite, while remaining unquestioned by the media.

In fact, where we are now is that the £350m a week that the NHS was promised on the side of the Brexit bus could in fact meet the nurses’ pay claim in full. And there’d still be around £9bn a year left over.

his is not taking account of the fact that the money could be spent into existence by government – without ever having to ‘find’ it and health expenditure would have a multiplier usually estimated at about 3 and this will be more when almost one in ten of the population are awaiting attention by the NHS – simply as a result of government underinvestment in healthcare....
Progressive Pulse
Deceiving people using monetary affordability
Peter May

A Peculiar Form of American Madness — W. J. Astore

America is touched by a peculiar form of collective madness that sees military action as creative rather than destructive, desirable rather than deplorable, and constitutive to democracy rather than corrosive to it….
Actually, the US is an empire (successor to the British empire) rather than the liberal democracy it presents itself as.

The difference between America and fascist states is that in fascist states corporations are at the service of the state and in the US the state is at the service of corporations, in particular the MICIMATT (Military-Industrial-Congressional-Intelligence-Media-Academia-Think-Tank complex).

This article is about the corrosive influence of the MICIMATT on the national interest and moral fiber of the country. It is echoed in many articles published recently.

This one is of particular interest in that it is by a retired career officer that served as a professor at the Naval Postgraduate School.

As always, follow the money (and power).

Bracing Views
A Peculiar Form of American Madness
W. J. Astore, Lieutenant Colonel (USAF ret.), taught at the Air Force Academy, the Naval Postgraduate School, and currently at the Pennsylvania College of Technology

Michael Hudson Answers Questions on Europe’s Self-Immolation, Fed’s Malpractice, Changing World Order — Mohammad Itmaizeh

Yves here. We trust you’ll enjoy this wide-ranging but compact interview with Michael Hudson on Lebanon’s Almayadeen TV. The topics include Europe’s de-industrialization, the Fed fighting the wrong war and hurting innocent bystanders, the rise of new power blocs, and debt....
Naked Capitalism
Michael Hudson Answers Questions on Europe’s Self-Immolation, Fed’s Malpractice, Changing World Order
Questions from Almayadeen TV, Lebanon by Mohammad Itmaizeh

Yield Curve Inversions And Recessions — Brian Romanchuk

This article continues the previous discussion of bank net interest margins. In it, I discussed how changes in the yield curve changed the net interest margin (NIM) for banks. This showed up historically — when bank balance sheets were shattered by the combination of holding long-dated mortgages with low fixed coupons versus having a sky-high short-term rate imposed by deranged Monetarists. In this article, I address a common macroeconomic story: yield curve inversions cause recessions by the alleged effect on NIM. As a spoiler, I do not think that story holds water in “modern” banking systems..…
Bond Economics
Yield Curve Inversions And Recessions
Brian Romanchuk






Bill Mitchell – IMF continue to demonstrate their neoliberal biases

The IMF published a new blog the other day (November 21, 2022) – How Fiscal Restraint Can Help Fight Inflation – which demonstrates that the organisation is still stuck in a New Keynesian world and despite all the empirical dissonance that has been building over the last decades to militate against that economic approach, little evolution in thinking is apparent. The battle to dispense with the mainstream approach is going to be harder and longer than many thought.…
Monetarism  ("Friedmanism") is entrenched in group think to the degree that it is considered an ideological fundamental functioning as a shibboleth. This is what beyond being a mere convention or meme. It's become an accepted criterion — a ticket of admission, as it were, to the club. "New Keynesianism" is Keynesian in name only, ignoring the major contributions of Keynes and even more so the development of Post Keynesianism and subsequently MMT. Uphill fight. The way things are going that fight may not be won in the West. The so-called developing world may be more open to new thinking.

Bill Mitchell – billy blog
IMF continue to demonstrate their neoliberal biases
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Saturday, November 26, 2022

Spending chains and Sankey diagrams — Alan Hutchison

Understand spending chains and you understand a fair chunk of Modern Monetary Theory. When the government spends into the economy it initiates a sequence of financial flows in the non-government sector. The first recipient of the spending is likely to re-spend some or all of it and subsequent recipients will do the same, and so on. That’s a spending chain.

At first glance it looks as if the money will bounce around the economy forever and if that were the case the government would have to stop spending or inflation would soon result. Fortunately, there are two things which stop the money being used indefinitely: tax and savings.

The best way to understand this is with the aid of a Sankey diagram.…
The Gower Initiative for Modern Money Studies
Spending chains and Sankey diagrams
Alan Hutchison
(Published on Matches in the dark 18th October 2018 · Updated 20th November 2020)

Friday, November 25, 2022

New Telegraph (Nigeria) — Kaboub To Deliver African Migration Summit Lecture December 8

The 2nd African Migration Summit (AMS) has been slated for December 8, with Associate Professor, Fadhel Kaboub from Denison University, Ohio, United States of America, as the guest speaker. He is to deliver a presentation titled: “Are We Prepared For Mass Climate Migration: A Coherent Framework For Resilience And Justice.” Themed “Climatic Change, Migration And Africa’s Future,” the summit would also be chaired by Nigeria’s House of Representatives Committee Chairman on Diaspora Matters, Honourable Tolulope Akande-Sadipe....
Fadhel Kaboub is an MMT economist that specializes in the developing world.

See also

The Eagle Online (Nigeria)
Prof. Kaboub to deliver Second African Migration Summit lecture

Russian sanctions: the view from the car market — Philip Pilkington

In the 1990s, the West used to see its economic influence in countries like Russia as a victory and a show of Western power. This was always the correct view. Now our leaders see the exclusion of Western products from foreign markets as a victory. This is such a muddled view it is almost comical. It is the sort of view that shows how ill-prepared our leadership class are for navigating the new multipolar world....
Import substitution domestically and internationally importing from friendly countries, like China. India will also want to be in the market. Inadvertently, sanctions are contributed to realignment and multipolarism as the West loses markets and influence.

Macrocosm
Russian sanctions: the view from the car market
Philip Pilkington

Thursday, November 24, 2022

TASS — Putin calls for creating international payment system independent of interference

An independent system of international payments can be created based on digital currency and blockchain technologies, Russian President Vladimir Putin said on Thursday....
TASS
Putin calls for creating international payment system independent of interference

Also at TASS
About 200 countries are assessed and Brazil, Saudi Arabia and the Republic of Korea are the three leaders
Russia is among top ten countries in digitalization of public services — Putin

Bill Mitchell — The RBA governor jumps the shark

Today we consider how asinine Australian’s monetary policy makers are now sounding. Yesterday, I reported the massive income redistribution that is going on at present as a consequence of central banks now hiking interest rates. This not only favours those with interest rate sensitive assets and punishes borrowers, but also necessitates, under current policy settings that central banks pay millions to trillions of cash to the banks that hold excess reserves. The excess reserves are the consequence of quantitative easing programs. Some might say this is the fault of the QE programs. But an Modern Monetary Theory (MMT) interpretation is that under optimal policy where no public debt is issued at all, the bank reserves would still accumulate. The MMT position would see no support rate paid and a Japan-style zero interest rate regime maintained at the short-end of the yield curve. In that case, there would be no transfers of cash to the banks as a result of their excess reserve holdings. Today, there is more though. On Tuesday (November 22, 2022), the Reserve Bank of Australia governor gave an address to yesterday (November 22, 2022) – Price Stability, the Supply Side and Prosperity – to the Annual CEDA dinner in Melbourne. He told the audience that we are entering a period of global uncertainty which will require more rapid adjustments in interest rate settings, up and down, to deal with the growing threat of inflation. It was an appalling display of hubris and September cannot come quick enough – when his contract as governor expires....
Bill Mitchell – billy blog
The RBA governor jumps the shark
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

China’s gold stockpiling is dollar warning sign — William Pesek

Going to gold as trust in the USD as a safe asset wanes. The status of a reserve currency is based on whether other countries choose to save in it. That willingness to hold the dollar appears to be decreasing.

Asia Times
China’s gold stockpiling is dollar warning sign
William Pesek

Commie Congressman defends FTX to CME Guy trying to warn him

 

Can’t even make it up, dumb commie left all corrupt:



Here is CME guy Duffy explaining it better on Tucker this week:





FTR I’ve never taken one dime from the FTX guy Sam Bankman Fried… can all others say this?


Wednesday, November 23, 2022

Five Reasons Why G7's Price Cap on Russia's Oil is Doomed — Ekaterina Blinova

Basically, the G7 lacks the power. The article explains the how and why.

Not to mention that such a move undermines the "rules-based order" policy of free markets and free trade, further showing who actually makes the rules unilaterally.

Frankly, it looks like desperation.

Sputnik International (Russian state-sponsored media)
Five Reasons Why G7's Price Cap on Russia's Oil is Doomed
Ekaterina Blinova

Politico — EU plans subsidy war chest as industry faces ‘existential’ threat from US

European industry is on an emergency footing thanks to high gas prices and new lavish subsidies for American rivals.

(Disclosure: Politico is owned by Alex Springer, a German publisher.)

Politico
EU plans subsidy war chest as industry faces ‘existential’ threat from US
Jakob Hanke and Barbara Moens


China Announces New Social Credit Law — Zeyi Yang

The reality versus the hype. (Actually, the Chinese system doesn't sound as intrusive as the American credit reporting system, which it loosely resembles.)

MIT Technology Review
China Announces New Social Credit Law
Zeyi Yang

Think Again About Persistent Inflation–and the Non-Partisan Fed — James K. Galbraith

Now that the US midterm election is over, markets and the financial press are returning to a more dovish outlook and concluding that major sources of inflationary pressure were transitory after all. But it may not last, because monetary policy appears to have been following politics more closely than its practitioners want to admit.…
Project Syndicate (free registration may be required to read)
Think Again About Persistent Inflation - and the Non-Partisan Fed
James K. Galbraith | Lloyd M. Bentsen Jr. Chair in Government/Business Relations and Professor of Government at the Lyndon B. Johnson School of Public Affairs, The University of Texas at Austin

Bill Mitchell — Champagne socialists in the banking sector reaping millions from public money

It’s Wednesday, and before we get to the music segment, I document some developments in the banking system which are not receiving much press at the moment. I refer to the fact that the rate hikes now being implemented by most central banks are not just allowing the commercial banks to widen spreads between deposit and lending rates which will generate significant windfall profits for the banks and their shareholders. The increasing interest rates are also delivering massive cash injections to the banks who hold reserve accounts at the central banks. Why? Because the quantitative easing programs from the past have resulted in a massive buildup of excess reserves which are liabilities for the central banks. They are paying support returns on those reserve, which are scaled against the rising policy target rates. So the payments have escalated significantly and delivering a massive corporate welfare boost to the banks while the same interest rate rises are causing hardship to borrowers, especially those on low incomes. And amazing redistribution of income towards the ‘champagne socialists’ all via our central banks....
And if those excess reserves were held as securities instead, the banks would still be getting the interest on the securities. QE increases banks' reserve balances when the cb buys government securities from commercial banks, a simple asset swap. (CBs do this in order to "increase bank liquidity," which is a monetarist error since doesn't work that way.)

In any event, it is "free money" for banks, in that both reserves held at the cb ("deposit accounts") and government securities held there ("time accounts") are default-risk free. But holding reserves instead also eliminates interest rate risk, i.e., falling securities values with increasing interest rates.  So this is "free money" is more than one sense.

When the cb increases the interest rate, it pays the increased rate to banks based on their reserve balances at the cb. All part of the "ledgerdemain" of finance that the public doesn't see and is largely unaware. What the public does see is rising prices that are costs to them since interest rate increases are a price increase that is passed on to borrowers.

Bill Mitchell – billy blog
Champagne socialists in the banking sector reaping millions from public money
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Tuesday, November 22, 2022

MMT: historical and logical foundations — Robert Cauneau

The contribution of the historical dimension to a theory, monetary or otherwise, is undoubtedly not sufficient in itself to demonstrate the correctness of this theory. But it does shed light on the underlying dynamics and the way in which they are articulated. It helps to identify the chains of causality that serve as a basis for the construction of a coherent body of theory, and it helps to eliminate arbitrariness in reasoning. It also helps to falsify certain ideas, such as the idea that bartering preceded the appearance of money, or that the market and real exchange predate money.

The main objective of this article is to show that MMT (Modern Monetary Theory) is based on solid historical facts and on the use of logic. In particular, it explains that coercive power is absolutely necessary for the emergence of monetized societies, and that the market is an epiphenomenon of the State, while unemployment is a social construction of the State, which itself has a monopoly on currency. Finally, he presents the specificity of MMT thinking compared to all other monetary approaches, taking "money" as a token of value that can be expropriated by those in authority....
Exploring the societal, cultural and institutional history and foundations of money-use.

Conclusion

It is clear that MMT is not a simple contribution, not only to economic thought, but also to the whole of the social sciences. It is a profound questioning of it, in the sense that it lays down bases common to all social classes, and therefore contains a theoretical value that goes far beyond the economic dimension. Indeed, by providing an explanation of the foundations of society, it presents itself as a possible starting point for understanding the macro level of the social sciences as a whole. It thus suggests the possibility of a transdisciplinarity allowing to lay the foundations of an integral social science, not only to realize bridges between the conclusions of the social sciences, but rather to lead to an organization of the knowledge concerning them. And this possibility, which has not yet been fully expressed, suggests how potentially very influential MMT is.
While most are familiar with "economics" as a disciple of study, having encountered it in their education, few are aware of economic anthropology, economic sociology, or economic geography as important fields in the social sciences. They also underlie anthropology, sociology and the world system, in which trade is foundational and where reserve currencies play a key role.

Getting the analysis of "money" right is necessary for understanding how societies function and how the world works. MMT purports to provide that. So as a result understanding MMT correctly becomes important.

MMT France

A BRICS Reserve Currency: Exploring the Pathways — Yaroslav Lissovolik

The new BRICS reserve currency can act in concert with the stronger role performed by BRICS national currencies to take on a greater share of the total pie of currency transactions in the world economy, writes Valdai Club Programme Director Yaroslav Lissovolik.

 The discussion centers around a basket of currencies comparable to the IMF SDR rather than a basket of commodities, as Sergey Glazyev proposes. Presently, the primary workaround to use of the USD is bilateral trade in national currencies.

Valdai Discussion Club
A BRICS Reserve Currency: Exploring the Pathways
Yaroslav Lissovolik

Oil Tanker Rates Soar To Astronomical Levels — Tsvetana Paraskova

  • Sky-high oil tanker rates are weighing on physical crude trade.
  • On Monday, the earnings on the benchmark key crude oil trading route hit $100,000 per day.
  • Falling premiums on spot prices for various crudes, however, could offset some of the high shipping costs, traders told Bloomberg.
Oilprice
Tsvetana Paraskova

RT — Scholz names reason behind European economy downturn

The German chancellor says the continent’s current economic woes are down to growth in Asia, rather than to the Ukraine conflict...
Interesting article.

RT — Question More (Russian state-sponsored media)
Scholz names reason behind European economy downturn

See also

In Macron's view, China must be subordinated. And so must the US. Interesting take.

While Macron doesn't say this, it's obvious that the entire world cannot be raised to Western living standards without exceeding the limitations of planetary resources, at least without implementing technological innovation that is still on the level of science fiction•. The "Western" (US) solution is to control the development of the non-Western world to prevent this from happening. This was discussed by serious people decades ago. This is what the rules-based order of unilateralism is about. But the US is now also subordinating Europe, which is the reason for Macron's speech.

Zero Hedge
Emmanuel Macron Comes Clean: "We Need A Single Global Order"
Tyler Durden

• MR Online
Extractivism in the Anthropocene
John Bellamy Foster, professor of sociology at the University of Oregon and editor of the Monthly Review. His most recent book is Capitalism in the Anthropocene: Ecological Ruin or Ecological Revolution (2022)

Sputnik International (Russian state-sponsored media)
China to Have Moon Base Powered by New Nuclear Power Plant by 2028, Lunar Exploration Chief Says

The Yield Curve And Bank Net Interest Margin — Brian Romanchuk

One of the topics that comes up whenever government bond curves re-price is the relationship between the yield curve and bank net interest margins (NIM). This then morphs into a second question: does a yield curve inversion cause a recession by the (alleged) effect of the yield curve on bank interest margins, reducing the willingness of banks to lend?

This article will look at the first question: what is the relationship between the yield curve and bank net interest margins? The second question will be dealt with in a follow up article. I am including a fair amount of tutorial material, since this is projected to be a section in my banking primer book.
Bond Economics

Monday, November 21, 2022

RT — More weapons for Ukraine needed before peace talks – NATO chief

NATO members “must be prepared to support Ukraine for the long haul,” Stoltenberg said, urging

Stoltenberg acknowledged that this assistance “comes at a price” for NATO members. “In our countries, many face cost of living crisis. Energy and food bills are rising. These are tough times for many,” he pointed out.

However, the NATO chief argued that Western countries will have to pay “a much harsher price” if Russia is allowed to achieve victory in Ukraine, as it would signal to other “authoritarian regimes” that they can achieve their goals by force, which would “make the world more dangerous.”
Sustainable politically?

RT — Question More (Russian state-sponsored media)
More weapons for Ukraine needed before peace talks – NATO chief

America's Electric Grid Can't Support The EV Revolution — Irina Slav

  • America’s electric grid is in dire need of a makeover.
  • While the Inflation Reduction Act has promised a lot of money into renewable energy and electric vehicle infrastructure projects, more focus needs to be placed on America’s ailing grid.
  • Without much-needed upgrades to the grid, both the renewable and EV revolution could face major challenges.

Failure of systems awareness and inability to deal with adaptive complexity? 

Oilprice

See also

Sputnik International (Russian state-sponsored media)
Britain Still Importing Massive Amounts of Russian Oil Despite Sanctions, Report Suggests

Oilprice
China Bought $60 Billion In Russian Energy Since Start Of Ukraine War
Irina Slav

Bill Mitchell — The Autumn Statement – an exercise in absurdity and public harm

First, the Bank of England seems to have abandoned credibility. Not to be outdone, the fiscal policy makers in government have now joined in the absurdity of mainstream policy thinking by reimposing austerity at the same time as the economy heads into recession. Milton Friedman and his gang used to claim the problem of fiscal policy was that it was practiced in a ‘pro-cyclical’ manner, by which they meant that because of time lags involved in implementation, by the time a stimulus to deal with a recession was in place and impacting, the private economy was already on the upturn – so that fiscal policy was working to push the cycle harder in the same direction. They claimed that was inherent to the use of fiscal policy, which rendered it unsuitable for use as a counter-stabilising (-cyclical) measure. The fact that that claim (which is contestable) won the debate in the 1970s is why all the central bank independence nonsense entered the scene and why New Keynesians claim that monetary policy should be the tool of choice to stabilise spending fluctuations. Now, the Tories in Britain are deliberately using fiscal policy in a pro-cyclical way – pushing the already recessionary forces further into the morass. A totally unnecessary and patently dangerous action. It almost beggars belief that they are getting away with this and the Labour Party essentially just offers to tune up the governments ‘violin strings’ a bit....
Bill Mitchell – billy blog
The Autumn Statement – an exercise in absurdity and public harm
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Saturday, November 19, 2022

Xi calls for free, open trade at APEC Economic Leaders' Meeting — Xinhua

Chinese President Xi Jinping said Saturday that free and open trade and investment are the purposes and principles of the Asia-Pacific Economic Cooperation (APEC) and also the pillar for the realization of the Putrajaya Vision 2040.…

Ironic that a nominally communist country is calling for free trade, where as the so-called liberal world is using "other means" to control trade to its advantage and expressly to disadvantage competitors. 

ECNS (Chinese official English news service)

Euthanizing The Poor Is Just Capitalism’s True Face — Caitlin Johnstone

Euthanizing the poor is just capitalism finally being honest about itself. After all these years of falsely pretending to have real solutions to the problems it creates, it finally presents a solution entirely in alignment with its values that actually works.

Capitalism’s answer to “What about the poor?” has always been “They should work harder,” and its answer to “What about those who can’t work?” has always been “They should die quickly.” But until now it’s always been spoken wordlessly in the policies enacted and the societal structures put in place. Now it’s just right there, completely undisguised. It’s refreshingly honest.…
A step too far, or just "Darwinian" (in the perverse sense)?

CaitlinJohnstone.com
Euthanizing The Poor Is Just Capitalism’s True Face
Caitlin Johnstone


See also

Internationalist 360º
Euthanasia Used in Canada to Get Rid of Poorest People
Misión Verdad

Firming Up Hierarchy — Blair Fix

Using Song’s data, here’s the idea that I’m going to test. I think that the recent rise in US income inequality is being driven by a redistribution of income within firms. In short, I believe that corporate hierarchies have become more despotic. Corporate elites have taken income that once went to the bottom of the hierarchy and redirected it to the top.

To test this idea, we’ll take a meandering route. First, I’ll tell you about my model of corporate hierarchy and how it explains income as a function of ‘hierarchical power’. Then I’ll give you a tour of US income inequality, and show you why it’s plausible that the recent rise in top incomes is being driven by growing ‘hierarchical despotism’. Next, I’ll break out the math and build a model of the US corporate landscape. I’ll use this model to predict the redistribution of income within US firms. Finally, I’ll compare the model’s predictions to the real-world trends reported by Song and colleagues. If all goes well, we’ll get some insight into the machinations of US corporate hierarchy.

My results? I find that to a surprising extent, the redistribution of income within US firms can be explained by a single parameter — a change in the rate that income scales with hierarchical power....

Attempting to peer into the black box of firms' proprietary structure and operations by using a data-based model to test a hypothesis.

As an aside, from the historical point of view, the hierarchical mode of organization is most ancient, having been developed very early for military use. The opposite mode of organization is consensual. 

Apparently, early political organization was a combination of consensual and hierarchical. Decision-making was based on consensual input and in some cases on consensual agreement. Elders and those who had demonstrated competence were given more weight in practice. But generally there was no chief and change of command as in later societies and militaries. This was the mode of organization or Native American tribes and nations. The title "chief" is often misunderstood as meaning the organizational leader but it was a title earned by great bravery and accomplishment in combat. There could be many chiefs and there were also a few women that were awarded this high degree of recognition.

With the rise of civilization, meaning city-dwelling in anthropology, organization structure adapted to the increase in population. Consensual organization became less practical and hierarchical organization dominated. This was especially the case with the growth of the temple and the rise of a priestly class, as well as more complex military requirements owing to the introduction of technology. The Romans proved exceptionally astute in this in their deployment of the phalanx as precursor to tank warfare.

Democracy was introduced to recapture some of the consensual organization that had been lost along way when the priestly class became entitled and was characterized by an ecclesiastical hierarchy. Similarly, the warrior class developed into a supreme leader whose reign was passed hereditarily and who had the power to created title subordinates that developed into hereditary aristocracies.

The Age of Enlightenment in 18th century Europe subsequent to the Protestant Revolution give birth to modern liberalism, which was had begun to be instantiated in England with the Magna Carta (sort of). The United States of America was the first modern liberal constitutional democracy modeled on 18th classical liberalism. The US Constitution sought to combine consensual and hierarchical organization practically for governing a populous and diverse nation that was a federation of sovereign states. It was based on a model reflecting the Roman Republic (SPQR and all that).

Conversely, the firm model developed along hierarchical lines as the most practical to the task. The corporate system is quite ancient as a legally based institutional structure.  Like militaries, firms and chartered firms ("corporations") were organized on hierarchical models. However, the joint-stock company introduced a modicum of consensual organization through the influence of the stockholders on management. 

The contemporary corporation is an iteration of this model. Arguably, the contemporary corporate model has begun to resemble the tightly held corporate models that led to the level of control (oppression) that resulted in the development of classical liberalism first as an ideal and ideal and then to its establishment institutionally through the American and French revolutions.

The rising level of inequality of wealth and power suggest that a rebalancing in called for. Blair Fix's article suggests that the reason for the growth of this imbalance lies in top-heavy hierarchical organization and maldistribution of power. The program of socialism is to reintroduce the consensual model. However, it is not clear how that could be accomplished without sacrificing too much of the practical benefits of hierarchical organization. The same challenge faces the implementation of direct democracy instead of representative "democracy" that is too easily corrupted by wealth and power imbalances.

Economics from the Top Down
Firming Up Hierarchy
Blair Fix

Friday, November 18, 2022

TASS — Russia, China plan to jointly develop power equipment

Read "technology sharing." Russia already does this with India, including military hardware.

TASS (Russian state media)
Russia, China plan to jointly develop power equipment

See also at TASS

China, Russia partnership rock-solid — Chinese ambassador in Moscow

Russian gas supplies to China paid in yuan and rubles — Novak

Russia and China to sign intergovernmental gas supply agreement soon — Novak

The G20 is dead. Long live the G20 — M. K. Bhadrakumar

The US is standing in the way of the progress of the world economy. The ROW is becoming impatient with the the US and vassals creating obstacles. But even the vassals are under pressure resulting from US hubris and its consequences for the world system. Now the US is running into opposition, some vocal—President Xi in particular. Nothing mentioned of BRICS and its expansion though. It was apparently the elephant in the room at the Bali meeting, everyone being well aware of it, not to mention BRI, which Bhadrakumar observes, has as yet no Western counterpart. The US-led West is simply trying to act as spoiler in this regard (rather  than pony up).

India Punchline
The G20 is dead. Long live the G20
MK. Bhadrakumar | retired diplomat with the Indian Foreign Service and former ambassador.

Thursday, November 17, 2022

Is Confucius Really Dead? Interview of sociologist — Wu Haiyun interviews sociologist Zhao Dingxin

Sociologist Zhao Dingxin, author of “The Confucian-Legalist State,” on the demise of Confucianism, the resilience of Legalism, and the structural sources of individual power....
Zhao Dingxin looks at the broad sweep of history. Although he is neither a Marxist nor a Hegelian, his viewpoint is dialectical, which is not surprising since Chines thought is dialectical rather than categorical, while most Western thought is categorical. So he has some interesting takes.

Sixth Tone
Is Confucius Really Dead?
Wu Haiyun interviews sociologist Zhao Dingxin

How China Will Achieve Hegemony — Carl Bildt

Bildt argues that the US is short-sighted in abandoning free trade to address China. China will dominate through trade.

Project Syndicate
How China Will Achieve Hegemony
Carl Bildt

China sets up national university for aged, to 'build lifelong learning society' — Du Qiongfang

China's Ministry of Education released a notice on Thursday that it has decided to set up a national university for the aged, a move that experts believe is intended to cope with the aging society and build a lifelong learning society.

According to the notice, the plaque of the National University for the Aged will be unveiled and merged with the Open University of China - a lifelong school for adult learners.

The Open University of China is not only an educational entity, but also an educational system covering both urban and rural areas of the country. It is composed of one headquarters in Beijing, 45 branches and 3,735 learning centers, according to the official website of the university.…
Global Times (Chinese state-sponsored media)

Goodbye G20, hello BRICS+ — Pepe Escobar

The increasingly irrelevant G20 Summit concluded with sure signs that BRICS+ will be the way forward for Global South cooperation.
It's ironic how the first colonies to revolt and win separation from the former colonial master were the original thirteen colonies of America that instituted the United States of America and how the US has become the colonial master resisting the insurgent colonies and vassal states. Will it turn out similarly. or will the US be able to disrupt the process? The stakes could hardly be higher. Stay tuned.

The Cradle

Wednesday, November 16, 2022

You are under contrôle: French elites privately fear the US and new research explains why — Felix Livshitz

New research published by France’s Ecole de Guerre Economique has revealed some extraordinary findings about who and what the French intelligence services fear most when it comes to threats to the country’s economy.

The findings are based on extensive research and interviews with French intelligence experts, including representatives of spy agencies, and so reflect the positions and thinking of specialists in the under-researched field of economic warfare. Their collective view is very clear - 97 percent consider the US to be the foreign power that “most threatens” the “economic interests” of Paris.…

Turns out that De Gaulle had it right. 

Felix Livshitz

See also

Reminiscence of the Future
Pardon My French, But--Boo Hoo.
Andrei Martyanov, former USSR naval officer and expert on Russian military and naval issues.

US agency seeks to boot HK trade offices from American soil — Jeff Pao

Xi-Biden conciliatory summit fails to deter US-China Economic and Security Review Commission’s censure of HK’s rights situation….
It's not what you say, but what you do. Actions give the lie to Biden's "conciliatory remarks." Did he really think that Xi et al would not notice this?

It appears that economic liberal is on the wane owing to economic warfare. Free trade is being canceled by sanctions. Free markets by the proposed market caps on energy. Free capital flow by freezing accounts.

Smoot-Hawley redux?

Die Karl Marx Frage—The errors of presentism and exclusivism — Branko Milanovic

If you are interested in either history of economics or Marx....

Global Inequality and More 3.0
Die Karl Marx Frage—The errors of presentism and exclusivism
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

Monday, November 14, 2022

Bill Mitchell — Why listen to so-called ‘experts’ that were so wrong about Brexit?

There is a short memory in the public discussion about economics. If there wasn’t many players that get the wide platforms to express their views, opinions, forecasts, etc would burnout very quickly given how appalling their track records are. I was thinking about that while looking at the most recent Foreign Direct Investment data and reading UK Guardian articles about the demise of the most recent British Prime Minister. While it is very hard at present to trace the economic events in terms of individual drivers because Covid, the Ukraine situation and OPEC+ have certainly muddied the waters, there is some clear evidence available that demonstrates the mainstream anti-Brexit analysis and predictions was completely wrong. Given the same sort of characters and institutions are consistently given platforms in the media to proselytise and scare the b-jesus out of people about fiscal positions etc, one wonders why they retain credibility after being so wrong about Brexit, while commanding the floor of authority. My position is that they were wrong then and remain unreliable sources of information about what is happening now...
Bill Mitchell – billy blog
Why listen to so-called ‘experts’ that were so wrong about Brexit?
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Sunday, November 13, 2022

Interest on Reserves: History and Rationale, Complications and Risks

 

Article from the CATO libertarian moron people here…

This whole thing was from Art Degree douche Milton Friedman doing the whole figurative “bond vigilante!” thing:


George Tolley (1957) and Milton Friedman (1960) first argued that since bank reserves can be created at zero marginal cost within a fiat money regime, economic efficiency dictates that the opportunity cost to banks of holding reserves should be driven to zero as well. Tolley and Friedman also pointed out that one way to satisfy this efficiency condition is for the central bank to pay interest on required reserves at a rate approximating those available on other safe and highly liquid short‐​term assets, such as United States Treasury bills. Based largely on this economic efficiency argument, it seems, the Financial Services Regulatory Relief Act of 2006 granted the Federal Reserve authority to begin paying interest on bank reserves,


Thank that dead guy for any current risk asset price stabilization…

Saturday, November 12, 2022

Something Of Import... — Andrei Martyanov

 Commercial aircraft market and competition therein.

Reminiscence of the Future
Something Of Import...
Andrei Martyanov, former USSR naval officer and expert on Russian military and naval issues.

Disciplining workers in a workers’ state — Branko Milanovic

Of interest both in the relationship of capitalism and socialism and also the MMT JG. Getting down to specifics.

Global Inequality
Disciplining workers in a workers’ state
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

Bamboo diplomacy: the China-SE Asia romance — Pepe Escobar

Beijing’s ties with countries now in ASEAN tend to bend the bamboo way: soft, clever, persistent and enduring
Asia rising — economically.

Asia Times
Bamboo diplomacy: the China-SE Asia romance
Pepe Escobar

October 12th bottom…

 

This bottom on October 12th might be where the increase in government interest income overcame the reduction in NPVs due to the risk free rate increase itself… 



This corresponds with the recent bottom in Depository system Residual (Assets - Liabilities ie implied Capital)  here:




Just depends on the first derivative of Fed policy rate increases… if they maintain current plan of reducing the magnitude of periodic increases then this bottom will probably stand and we’re in the clear from these morons…




Fed policy

 

😂😂😂😂… assholes….







Student Thought and Classroom Language:Examining the Mechanisms of Change in Dialogic Teaching

 

Paper here mentions how the required dogmatism in the Platonist dialogic methodology can prevent education…


Multiplist and absolutist epistemologies are incompatiblewith dialogic teaching. In the words of Bakhtin (1984), “bothrelativism and dogmatism equally exclude all argumentation,all authentic dialogue, by making it either unnecessary ...orimpossible (p. 69). Despite their differences, both multiplistsand absolutists rely on fundamentally monologic assump-tions about knowledge: They either discount a possibility ofshared understanding or insist on an absolute truth (Sidorkin,1999).


The thing is with the Platonist Art Degreed Monetarists, they are NOT attempting education… they are imposing policy… they already have been educated…

So these authors caution the reader against the use of dogmatism in education… ok maybe you could see that…  but in policy advocacy nobody is trying to educate anyone… 

Imposing policy is NOT EDUCATION… (btw MMT academics would do well to continuously remind themselves of this) … so Platonist Art Degree dogmatism becomes again preferred…

So it’s really out of place for MMT academic people to whine and complain that “you haven’t read the MMT literature!” like they do all the time… I would remind them that these people are NOT in your f-ing classrooms… They are advocating for policies…

Thursday, November 10, 2022

Michael Hudson — War and Debt to Rule

It should not be surprising that modern financial elites are behaving in the way that Ibn Khaldun described decadent dynasties: with anti-social selfishness. The drive for money turns men into homo economicus, the self-seeking “libertarian” individuals idealized by the Austrian and Chicago Schools, unconstrained by feelings of the “group identity” that Ibn Khaldun called ‘asabiyah, Ferguson called “fellow feeling” and the Russian anarchist Peter Kropotkin called mutual aid.

Most philosophers anticipated that wealth would breed selfishness and hubris, but none were so cynical as to anticipate that elites would rewrite history to depict their gain-seeking and luxury not as a decline of civilization lapsing back into savagery, but as a rise or even as the eternal state of society, a timeless and constant human nature. The public-spirited moral checks that used to be viewed as consolidating social solidarity are now denigrated as a detour from the “natural” spirit of self-seeking.…
Michael Hudson — On Finance, Real Estate And The Powers Of Neoliberalism
War and Debt to Rule
Michael Hudson | President of The Institute for the Study of Long-Term Economic Trends (ISLET), a Wall Street Financial Analyst, Distinguished Research Professor of Economics at the University of Missouri, Kansas City, and Guest Professor at Peking University

See also

Keynes agreed,
Some of the most important work of Alfred Marshall-to take one instance-was directed to the elucidation of the leading cases in which private interest and social interest are not harmonious. Nevertheless, the guarded and undogmatic attitude of the best economists has not prevailed against the general opinion that an individualistic laissez-faire is both what they ought to teach and what in fact they do teach….
It is not true that individuals possess a prescriptive ‘natural liberty’ in their economic activities. There is no ‘compact’ conferring perpetual rights on those who Have or those who Acquire. The world is not so governed from above that private and social interest always coincide. It is not a correct deduction from the Principles of Economics that enlightened self-interest always operates in the public interest. Nor is it true that self-interest generally is enlightened; more often individuals acting separately to promote their own ends are too ignorant or too weak to attain even these. Experience does not show that individuals, when they make up a social unit, are always less clear-sighted than when they act separately....
John Maynard Keynes 
When the accumulation of wealth is no longer of high social importance, there will be great changes in the code of morals. We shall be able to rid ourselves of many of the pseudo-moral principles which have hag-ridden us for two hundred years, by which we have exalted some of the most distasteful of human qualities into the position of the highest virtues. We shall be able to afford to dare to assess the money-motive at its true value. The love of money as a possession — as distinguished from the love of money as a means to the enjoyments and realities of life — will be recognised for what it is, a somewhat disgusting morbidity, one of those semi-criminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease ... But beware! The time for all this is not yet. For at least another hundred years we must pretend to ourselves and to everyone that fair is foul and foul is fair; for foul is useful and fair is not. Avarice and usury and precaution must be our gods for a little longer still. For only they can lead us out of the tunnel of economic necessity into daylight. 
John Maynard Keynes, 1930 
Economic Possibilities for our Grandchildren, Section II
John Maynard Keynes, Essays in Persuasion, New York: W. W. Norton & Co., 1963, pp. 358-373

Wednesday, November 9, 2022

If its bad it must be because of Brexit or MMT or both depending — Bill Mitchell

There is no doubt that the on-going pandemic has left a trail of economic problems including major supply constraints, the growing problem of long Covid and other issues that are challenging policy makers. They have been exacerbated by the behaviour of OPEC+ and the Ukraine situation. We now have a period of inflation, real wage cuts and most central banks doing their best to make matters worse. However, we now have a phenomenon that goes like this. In the UK, everything ‘bad’ that arises is apparently because of Brexit even if the trends were there before the move or the problems are being shared across all countries. I imagine even if the English cricket team loses it is because of Brexit. This phenomenon has generalised however. Now, we have the claim that all bad economic news is because governments ‘followed’ MMT or something akin to it. Those who are insecure about MMT because it does better at explaining the real world than the mainstream theories are the same as the Remainers who predicted that the British economy would crash badly in 2017 and then every year after that. To soothe their worried souls they consider any ‘bad’ news to be because of ‘MMT’ or in the case of Britain because of Brexit. Neither proposition has any foundation....
Elites unwilling to take responsibility or be accountabable, and hardly only in the UK. In the US, it is "Russia" and "Putin" and the other party that gets the blame for elite failures.

Bill Mitchell – billy blog
If its bad it must be because of Brexit or MMT or both depending
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Primer: Bank Capital — Brian Romanchuk

Bank capital is the buffer on a bank’s balance sheet that allows it to absorb losses, particularly credit losses. Although there is a great deal of excitement about bank liquidity — bank runs, just like in “It’s a Wonderful Life”! — but the main danger is the capital buffer being wiped out (insolvency). A bank run might feature at the end of the bank’s lifetime (quite often, regulators just step in), but the trigger is the insolvency. This article discusses bank capital at a high level, from a macroeconomic viewpoint.

Bond Economics
Primer: Bank Capital
Brian Romanchuk

Tuesday, November 8, 2022

Xinhua — White Paper-Jointly Build a Community with a Shared Future in Cyberspace

China's State Council Information Office on Monday issued a white paper titled "Jointly Build a Community with a Shared Future in Cyberspace.
Xinhua (Chinese state media)
Full Text: Jointly Build a Community with a Shared Future in Cyberspace

Michael Hudson — The Rentier Economy is a Free Lunch

Video and transcript. Covers a lot of ground, mostly things that appear in his books.

Some representative quotes:
...unless you have a study of economics as an economic system – understanding what’s causing the polarization and the poverty in the United States – you’re not going to be able to have a reform movement to change the system.

The role of economics departments is to dumb down the understanding of the economy.….

Again, you want to look at the economy as a system. You don’t want to reduce everything to one-dimensional “here’s the price level”. You want to look at the multi-layered economy. What are the cost prices? What are the economic rents? What are the monopoly prices? What’s the tax system? You have to look at the economy as a system, not in a one-dimensional way. So, I can’t untangle all of the jumble any clearer than that.…

The point of MMT is that just as banks create endogenous credit on their own computers, the government can create credit. The government doesn’t have to borrow money from the 1% or from bond holders in order to spend it; the government can simply print it as it did under the greenbacks.
The government can create its own credit. And there’s nothing wrong with running a budget deficit because a budget deficit does not have to be paid by taxpayers paying taxes. A government deficit can be funded by simply creating the money on your own computer – not by taxes. That’s the point that Stephanie Kelton has been making again and again in what she writes.

And that really is the essence of MMT….
While Michael Hudson is an MMT ally, not all of his ideas are compatible with MMT. But he does seem to agree with MMT founder Warren Mosler's fundamental insight that a sovereign currency issuer has a public monopoly on the currency. One of his contentions is that this public monopoly has been monopolized under financial capitalism. On the other hand, his work represents a unique school of thought in political economy and he is difficult to categorize. There are many influences on his work that are different from MMT. 

Michael Hudson — On Finance, Real Estate And The Powers Of Neoliberalism
The Rentier Economy is a Free Lunch
Real Progressives interviews Michael Hudson

Sunday, November 6, 2022

US labour market – shows further signs of slowing — Bill Mitchell

Last Friday (November 4, 2022), the US Bureau of Labor Statistics (BLS) released their latest labour market data – Employment Situation Summary – November 2022 – which suggested that the US labour market showed signs of slowing further, with payroll employment growing by just 261,000 net jobs. The labour force measure showed employment and labour force growth turning negative as the participation edged down. The result was that the official unemployment rate rose by 0.1 points to 3.7 per cent. There are also no fundamental wage pressures emerging at present to drive any further inflation spikes. Wages growth appears to be reactive to inflation rather than propelling it. Wages growth appears to be reactive to inflation rather than propelling it. The claim that wage pressures are now pushing inflation is untenable given the data....
Bill Mitchell – billy blog
US labour market – shows further signs of slowing
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Saturday, November 5, 2022

US godfather makes a chip offer you can’t understand — David P. Goldman

 Another instance of not thinking things through — shooting from the hip and shooting oneself in the foot in the process.

Asia Times
US godfather makes a chip offer you can’t understand
David P. Goldman

Scholz’s China trip raises hackles — M.K. Bhadrakumar

Intersection of geopolitics and economics.

India Punchline
Scholz’s China trip raises hackles
M.K. Bhadrakumar | retired diplomat with the Indian Foreign Service and former ambassador.

See also

Oilprice
Europe May See Forced De-Industrialization As Result Of Energy Crisis
Irina Slav

Greta goes Commie and Bono goes Capitalist

 

Big changes this week for these two uneducated people trying to figure it all out…







Functions

 

Nice intro to must be an applied mathematics course…. Couldn’t agree more with this guy…




I could just imagine an Art Degree teacher dude saying “FIGURATIVE LANGUAGE DESCRIBES THE WORLD!!!”  yeah right!! 😂😂😂


Friday, November 4, 2022

‘Seven sins’ emerge from flawed Western political systems: Global Times editorial

The Chinese view of the Western way. 

These can be regarded as the “seven sins” of the Western political systems in real life. They must reform and change their systems from being capital-centered to people-centered.

Capitalism favors capital including land, that is, ownership, as a single factor, and socialism favors labor (workers as people rather than as a factor). 

Global Times (Chinese state-sponsored media)

The Destiny of Civilization: An Interview with Michael Hudson on Economic Development, Rentierism, Debt, China — D. L. Jacobs interviews Michael Hudson

The Destiny of Civilization is Michael Hudson's latest book.

Naked Capitalism
The Destiny of Civilization: An Interview with Michael Hudson on Economic Development, Rentierism, Debt, China
D. L. Jacobs interviews Michael Hudson

Could the Ukraine Conflict Be an Opportunity for the Global South? — T.K. Rajalakshmi interviews Jomo Kwame Sundaram

Good intro by Yves Smith.

Naked Capitalism
Could the Ukraine Conflict Be an Opportunity for the Global South?
T.K. Rajalakshmi, Senior Deputy Editor of Frontline. Originally published at The Hindu; cross posted from Jomo Kwame Sundaram’s website
Interview with Jomo Kwame Sundaram, Emeritus Professor, University of Malaya.


Thursday, November 3, 2022

Have the bond vigilantes killed off modern monetary theory? MMT proponent Stephanie Kelton says that’s nonsense. — Steve Goldstein

As investors assesses the remarkable turnaround in fiscal policy from one of the world’s number-six economy, the U.K., the one conclusion surely is that a nation’s financial flexibility is limited by the willingness of world markets to finance it.

“Ending MMT is the international lesson of the U.K. debacle—any populist selling fiscal pipedreams will be confronted by the precedent of the U.K.,” said Paul Donovan, chief economist at UBS Global Wealth Management, in a recent note.

To which Stephanie Kelton, the leading proponent of modern monetary theory and author of The Deficit Myth replies, “rubbish.” ...
Market Watch
Steve Goldstein

Will Biden Gamble on a Ukraine Coalition? — Andrew Napolitano interviews Co. Douglas Macgregor (video)


See also Col. Macgregor's article at The American Conservative, Will Biden Gamble on a Ukraine Coalition?

Will Biden Gamble on a Ukraine Coalition?
Judge Napolitano - Judging Freedom

Will Biden Gamble on a Ukraine Coalition? — Douglas Macgregor

Warning to think through both ends and means of what you are planning to do in terms of the big picture. Col. Macgregor is among the very few who appear to understand the big picture.

The American Conservative
Will Biden Gamble on a Ukraine Coalition?
Douglas Macgregor, Col. (ret.) is a senior fellow with The American Conservative, the former advisor to the Secretary of Defense in the Trump administration, a decorated combat veteran, and the author of five books.

The Maritime Executive — Maersk Achieves Record Quarter While Warning of Recessionary Signals

”Our third quarter result was another record and the 16th quarter in a row with year-on-year earnings growth. Ocean freight rates, which have driven the exceptional results we have delivered in 2022, were again up both year-on-year and compared to the second quarter. However, it is clear that freight rates have peaked and started to normalize during the quarter, driven by both decreasing demand and easing of supply chain congestion,” said Søren Skou, CEO of A.P. Moller - Maersk.

Elaborating on his comments, Skou told the Financial Times “every indicator we are looking at is flashing dark red.” He said that the shipping giant sees a recession looming that will confirm if the shipping industry has become more rational due to consolidation. He also points to Maersk’s decision to maintain its capacity in the 4.1 to 4.3 million TEU mark as opposed to competitors that placed large newbuild orders during the recent surge in shipping volumes.

Given the unfolding economic slowdown, Maersk told shareholders that it has lowered its outlook for 2022 growth in global consumer demand....
The Maritime Esecutive
Maersk Achieves Record Quarter While Warning of Recessionary Signals

High School Economics and Personal Finance Courses — Timothy Taylor

 Worth thinking about from an MMT perspective. Someone needs to write a primer on econ and personal finance that ordinary folks can use as a compass to navigate in their decision making. It would not need to be a dedicated high school course but rather a book suitable for use as a high school course and which would also have wider application.

I took college electives in econ, investment, and statistics. The econ course used Samuelson, which most of the student recognized as not the way the world actually works, and it certainly did not help me navigate either personal economics or macro in understanding the world.  

On the other hand, the investment course used Graham's Intelligent Investor and Graham & Dodd's Security Analysis. This was a worthwhile course.

It wasn't until I encountered MMT that I began to understand economic reality in terms of actual operations.

Conversable Economist
High School Economics and Personal Finance Courses
Timothy Taylor | Managing editor of the Journal of Economic Perspectives, based at Macalester College in St. Paul, Minnesota|

Wednesday, November 2, 2022

Bill Mitchell – Degrowth, deep adaptation, and skills shortages–Part 5

This is Part 5 of an on-going series I am writing about the issues facing societies dealing with climate change and other elements which come together as a poly crisis. The series will unfold as I research and think about the topic more through my Modern Monetary Theory (MMT) lens. Today, I am concluding the analysis of the questions relating to the ageing society and the resulting skill shortages, that the mainstream narrative identifies as key ‘problems’ facing governments across the Western world. Like any issue, the way the ‘problem’ is constructed or framed influences the conclusions we come up with. Further, the tools use to operationalise that construction also influence the scope and quality of the analysis and the resulting conclusions. As I explained in Monday’s blog post – Degrowth, deep adaptation, and skills shortages – Part 4 (October 31, 2022) – the use of mainstream macroeconomics fails to deliver appropriate policy advice on these questions. But further, when we introduce multi-dimensional complexity – such as degrowth to the ageing society issue – the mainstream approach becomes catastrophic. MMT is a much better analytical framework for drilling down to see what the essential problem is and what are non-problems and thus creating the questions and answers that lead to sound policy. Today, I show why the existence of skills shortages really provides us with the space to pursue a degrowth strategy while not causing material standards of living to collapse. They are better seen as indicator of what is possible rather than a macro problem....
Bill Mitchell – billy blog
Degrowth, deep adaptation, and skills shortages – Part 5
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Captain Obvious Economy — Andrei Martyanov (video)

 



Focuses on Michael Hudson, who is an MMT ally but doesn't adhere strictly to MMT.

Captain Obvious Economy
Andrei Martyanov, former USSR naval officer and expert on Russian military and naval issues. 

Martyanov was born in Baku, USSR in 1963. He graduated from the Kirov Naval Red Banner Academy and served as an officer on the ships and staff position of Soviet Coast Guard through 1990. He took part in the events in the Caucasus which led to the collapse of the Soviet Union. In mid-1990s he moved to the United States where he currently works as Laboratory Director in a commercial aerospace group. He is a frequent blogger on the US Naval Institute Blog. He is author of Losing Military Supremacy, The (Real) Revolution in Military Affairs, and Disintegration: Indicators of the Coming American Collapse. — Clarity Press




World’s Second-Largest Container Carrier Sees Global Trade Slowing — Julianne Geiger

And A.P. Moller-Maersk A/S—which controls one-sixth of the world’s container trade—sees global trade slowing between 2% and 4% in a stark warning for not just the container industry but the oil and gas industry as well.…
Oilprice

Successful Tool Lending Libraries Force Us to Rethink What the Public Is Willing to Share — Yves Smith

 Coincidentally, I am in the process of setting up a tool library as well as research library for a community to encourage sharing. 

Sharing is a cultural thing. It used to be common in the US, but American culture has since become much more individualistic of late. We need to jettison the culture based on "it's every man for himself," and get back to 'We're all in this together."

Naked Capitalism
Successful Tool Lending Libraries Force Us to Rethink What the Public Is Willing to Share
Yves Smith

EU Threatens Secondary Sanctions Against Turkey Amid Row Over NATO Bids, Russian Ties — Conor Gallagher

More shooting oneself in the foot and wondering why one is having trouble standing. Europe is still living in fantasy land. And turning into a snake pit.

Naked Capitalism
EU Threatens Secondary Sanctions Against Turkey Amid Row Over NATO Bids, Russian Ties
Conor Gallagher

Some notes on the political economy of central banking — Nick Johnson

I have just finished a very useful collection of some of the papers of economist Gerald Epstein, entitled The Political Economy of Central Banking. Epstein is Professor of Economics and Co-Director in the Political Economy Research Institute (PERI) at the University of Massachusetts-Amherst in the US, which is known for the progressive research agendas of its members.

Rather than write a lengthy review, this post sets out some of the key points made in the book and which stood out for me as being original and important. Epstein’s focus on central banks (CBs) remains especially relevant in today’s world of increased inflation and CB efforts to return it to target rates.…
Gerald Epstein, Professor of Economics and a founding Co-director of the Political Economy Research Institute (PERI), UMASS (Amherst), is a Post Keynesian economist.

The Political Economy of Development
Some notes on the political economy of central banking
Nick Johnson

See also 
Charles Kindleberger ranks as one of the twentieth century's best known and most influential international economists. This book traces the evolution of his thinking in the context of a 'key-currency' approach to the rise of the dollar system, here revealed as the indispensable framework for global economic development since World War II. Unlike most of his colleagues, Kindleberger was deeply interested in history, and his economics brimmed with real people and institutional details. His research at the New York Fed and BIS during the Great Depression, his wartime intelligence work, and his role in administering the Marshall Plan gave him deep insight into how the international financial system really operated. A biography of both the dollar and a man, this book is also the story of the development of ideas about how money works. It throws revealing light on the underlying economic forces and political obstacles shaping our globalized world.…
New book. Not MMT per se but related.

Cambridge University Press
Money and Empire: Charles P. Kindleberger and the Dollar System
Perry Mehrling | Professor of International Political Economy at the Pardee School of Global Studies, Boston University

Lars P. Syll — What’s the use of economics?

What is the point of generating theoretical models that don't fit events that call for explanation? 

A classic example is the answer that Queen Elizabeth II received from when she asked her economists why they did not foresee the global financial crisis. The answer was the the conditions leading to it lay beyond the scope of the conventional model.

Lars P. Syll’s Blog
What’s the use of economics?
Lars P. Syll | Professor, Malmo University

Bank Liquidity Management Introduction — Brian Romanchuk

 Important for understanding some of the details of MMT. MMT is not about just government finance but the operations of the monetary system in general (general case) and in specific jurisdictions (special cases). Thus, the banking system and how it interfaces with the government needs to be understood from the institutional POV.

For modern financial systems, the key distinguishing characteristic of banks is that they key managers of the liquidity of the system. Although one can find small banks (or community banks) that operate on more traditional lines, banking firms are diversified and operate in the capital markets as well taking in deposits and making loans in the manner described in most banking primers. What differentiates banks from other financial firms is that they are in the business of selling liquidity via credit lines. In order to credibly offer that service, the banks themselves have to been seen as being unquestionably liquid.

Although central bank lender-of-last-resort facilities offer the ultimate backstop of banking system liquidity, the reality is that everyone involved views such operations represent a failure on the part of the banks — they will only exist further at the whims of the government. The role of regulators and risk managers at banks is to avoid that outcome. In this article, I discuss how the system is supposed to work.…
When banks provide liquidity they are essentially "creating money" owing to their special relationship with the central bank as the currency issuer through their access to the payments system in return for submitting to regulation and oversight. 

So it becomes necessary to understand central banking, commercial banking, and the institutional relationship of the two. This is the basis of MMT's operational description component. See MMT economist Eric Tymoigne's book on money & banking here.

Bond Economics
Bank Liquidity Management Introduction
Brian Romanchuk

Michael Hudson — Germany’s position in America’s New World Order

Germany has become an economic satellite of America’s New Cold War with Russia, China and the rest of Eurasia.

Germany and other NATO countries have been told to impose trade and investment sanctions upon themselves that will outlast today’s proxy war in Ukraine. U.S. President Biden and his State Department spokesmen have explained that Ukraine is just the opening arena in a much broader dynamic that is splitting the world into two opposing sets of economic alliances. This global fracture promises to be a ten- or twenty-year struggle to determine whether the world economy will be a unipolar U.S.-centered dollarized economy, or a multipolar, multi-currency world centered on the Eurasian heartland with mixed public/private economies.…
Or as the talk goes lately, "America's bitch."

Michael Hudson — On Finance, Real Estate And The Powers Of Neoliberalism
Germany’s position in America’s New World Order
Michael Hudson | President of The Institute for the Study of Long-Term Economic Trends (ISLET), a Wall Street Financial Analyst, Distinguished Research Professor of Economics at the University of Missouri, Kansas City, and Guest Professor at Peking University