Finding the Money: Can a film about modern monetary theory change our economic debates? — Cameron Murray

Finding the Money is now debuting in Australia. Murray is an Australian economist that writes chiefly about housing. 

Fresh Economic Thinking
Finding the Money: Can a film about modern monetary theory change our economic debates?
Cameron Murray

As US Modern Monetary Theory advocates make their case in Australia, Gareth Vaughan explains the world through their lens and how it might go down in New Zealand — Gareth Vaughan

 This article, which is favorable to MMT, contains a good explanation of what MMT is and isn't.

interest.co.nz
As US Modern Monetary Theory advocates make their case in Australia, Gareth Vaughan explains the world through their lens and how it might go down in New Zealand
Gareth Vaughan

Another side of the story.

[US] Conservatives, [El Salvador’s President Nayib Bukele] said, “always tell me that the problem is high taxes, but they are wrong.”

“The real problem is that you pay high taxes only to uphold the illusion that you are funding the government, which you are not,” he claimed, before describing how the government is financed by Treasury bonds, which are purchased by the Federal Reserve with printed money backed by the bonds themselves.

“The government is funded by money printing, paper backed by paper. A bubble that will inevitably burst,” he said, adding that “the situation is even worse than it seems, because if most Americans and the rest of the world were to become aware of this farce, confidence in your currency would be lost. The dollar will fall, and Western civilization with it.”

RT — Question More (Russian state-sponsored media)

The West could collapse – Latin American leader

Argentina Economy Shrank in December by Most Since Pandemic

 

“Oh sheeeeeeeeeeit!”….  😂😂😂

Argentina’s economy contracted more than expected in December as newly elected President Milei put in motion shock austerity measures https://t.co/HHMFKEqo1v

— Bloomberg Economics (@economics) February 22, 2024

Japan sinks into recession – but there is more to the story than the mainstream narrative would care to admit — Bill Mitchell

Last week (February 15, 2024), the Japanese Cabinet Office released the latest national accounts estimates for the December-quarter 2023 – Quarterly Estimates of GDP for Oct.-Dec. 2023 (The First preliminary) – which showed that the economy had slipped into an official recession (two consecutive quarters of negative GDP growth) and in the process had moved from being the third largest economy in the world to become the fourth behind the US, China and Germany. According to the media release – 2023年10~12月期四半期別GDP速報 – the quarterly growth rate was -0.1 per cent (annual -0.4 per cent). Domestic demand was weak, contributing -0.3 per cent while net exports contributed +0.2 per cent. Part of the story is related to a ‘valuation drop’ because the yen has depreciated in recent months, undermining the value of exports and increasing the value of imports. But while there is some hysteria in the ‘markets’ and the mainstream economics commentary about the result, caution is required because the data will be revised (it was only preliminary) as more data comes in and it is highly possible for the negative to become a positive. But, I also take a different perspective on this from the dominant narrative in the media as you will see if you read on.

There is quite a deal of misunderstanding about the so-called ‘lost decade’ in Japan, following its dramatic real estate crash in the early 1990s.

The current narrative builds on those misunderstandings and constructs the GDP outcomes as if low growth is a problem.

If you look at the next graph you will start to get the point....

William Mitchell — Modern Monetary Theory

Japan sinks into recession – but there is more to the story than the mainstream narrative would care to admit
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

The Smith Family manga–Episode 12– the Season 1 finale–is now available — Bill Mitchell

Episode 12 – the finale for Season 1 in our new Manga series – The Smith Family and their Adventures with Money – is now available. We will let everyone calm down from the excitement for a little while to give us time to write and draw Season 2, which will begin on May 24, 2024.

In the meantime, have a bit of fun with it and circulate it to those who you think will benefit …

William Mitchell — Modern Monetary Theory

The Smith Family manga – Episode 12 – the Season 1 finale – is now available
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Job Guarantee and Employer of Last Resort schemes: the political constraints on maintaining full employment — Nick Johnson

Kalecki

The Political Economy of Development
Job Guarantee and Employer of Last Resort schemes: the political constraints on maintaining full employment
Nick Johnson

US inflation rate is declining – no case for further rate rises — Bill Mitchell

 The US CPI data released yesterday showed that inflation continues to decline and the so-called ‘surprise’ that seems to have shocked the ‘markets’ are mostly down to the eccentric way the US Bureau of Labor Statistics calculates housing costs. The data provides no justification for further rate hikes in the US or anywhere else for that matter....

William Mitchell — Modern Monetary Theory

US inflation rate is declining – no case for further rate rises
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Why economics is an impossible science — Lars P. Syll

 The title might better read, Why orthodox economics is an impossible science. While so-called orthodox economics fits this bill, it doesn't necessarily apply to so-called heterodox schools like MMT.

One of the characteristic criticisms of MMY economists by so-called orthodox economists (like Paul Krugman) is "Where's your model?" For neoclassical" economists, who assume formalization as a sine qua non of doing economics, required methodological assumptions include "equilibrium and maximization" as Krugman is fond of saying. 

The post linked to below objects that this not even possible given the attendant conditions, other than as a "toy model" serving as "a teaching tool." Such models cannot underlie a casual explanation of real change in the world of events that economists then assume themselves perfectly capable of not only explaining but also prescribing. Their results speak for themselves.

Instead, MMT adopts an historical and institutional approach which recognizes economics as a study of events from particular perspectives that are conditioned by both subjective and objective considerations instead of presuming that economics is based on invariant principles similar to the natural sciences.

Economics is unlike physics and chemistry as natural sciences but it partakes of the life sciences including their extensions as the social sciences. While these "science" qualify as "science" owing to their assumption of naturalism and use the scientific method, the application of method is determined by the type of subject matter. The life and social science differ from the natural sciences in approach in that they types of data they study and seek to explain are quite different from the phenomena studied by natural sciences. 

A good example of this is an unsourced quote widely attributed to Richard Feynman, "Imagine how much harder physics would be if electrons had feelings." However, the issue goes much deeper institutionally since economics and finance are joined at the hip, economic data being reported not only in real terms but also nominal with the nominal taking precedence since monetary value in exchange is the basis of reporting about economic data. As a result, conditions that affect this supervene in economics, as MMT economists recognize. These conditions are historical and institutional.

Lars P. Syll’s Blog
Why economics is an impossible science
Lars P. Syll | Professor, Malmo University

Yi Gang on China's Digital Yuan — Zichen Wang

Former Central Bank governor lectures on the theories and practices of China's ambitious central bank digital currency.

China appears to be the most ambitious among major economies to develop its central bank digital currency - the digital yuan, and we have covered its development before.

On October 10, 2023, Yi Gang, China’s central bank governor between 2018 and 2023 gave a public lecture at Tsinghua University entitled 数字人民币的相关理论与实践 Theories and Practices Related to the Digital Yuan....

Almost everything you wanted to know about the digital yuan. 

Pekingnology
Yi Gang on China's Digital Yuan
Zichen Wang

What is Yi Gang trying to say in his 1st interview after retiring from PBoC? — Zichen Wang

Not about MMT but rather about "money."

Today, I am sharing a January 12, 2024 interview of Yi Gang, former Governor of the People’s Bank of China, by 金融时报 Jinrong Shibao (literally Financial Times), a newspaper by the central bank.

Yi obtained his Ph.D. in Economics from the University of Illinois Urbana–Champaign and became an Associate Professor with tenure at Indiana University–Purdue University Indianapolis, before going back to Peking University, his alma mater. He later joined the People’s Bank of China and rose through its ranks until heading it between 2018 and 2023.

Yi retired in July last year and his five-year tenure at the helm of China’s central bank is known for, according to Bloomberg, “a restrained policy approach focused on moderate stimulus and reducing financial risks in the economy.”

Pekingology
What is Yi Gang trying to say in his 1st interview after retiring from PBoC?
Zichen Wang

See also

In attrition war, on the economic front just like the Gaza and other fire fronts, the Axis of Resistance wins by maintaining its offensive capacities and operations for longer than the US and US-backed Israeli forces can defend. Like troops, tanks, and artillery pieces, the operational goal is to grind the enemy slowly but surely into retreat, then capitulation.

How to measure if this is happening now to the Israelis in the international money markets?

An international currency and bond trader answers by providing, first, a primer for each of the market indicators, and how to read them; and then a ready reckoner for the damage being done to Israel’s economic resources as those who operate in the money markets gauge their opportunity.

For making money, you see, the opportunity of capitalizing on Israel’s defeat may soon be more profitable than investing in its success. When the markets see this chance at profit-making, usually long before the politicians and their captive media acknowledge it, there is an inflection point in the flow of money. That does its damage, not by hitting the Israelis and Americans in their bunkers with bullets and bombs, but by moving the money the US-backed Israeli entity needs out of reach, and cutting them off, both the US and Israel, from market confidence that they can win their war, genocide or not.

The writer of this primer and money-market assessment has requested anonymity to protect against retaliation from the US, Israel or their allies.

Dances with Bears

ATTRITION WAR — HOW ISRAEL IS LOSING ON THE ECONOMIC FRONT
John Helmer

Yves Smith comments on the above post here. She has some issues with it.

Samuelson on the legacy we leave for grandchildren — Richard Murphy

Paul Samuelson, the author of what still might be the most-sold textbook of the post-war era had this to say on page 427 of his first edition, addressing a subject then very close to the thoughts of many of his readers:

Can it be truthfully said that “internal borrowing shifts the war burden to future generations while taxing places it on the present generation”? A thousand times no! The present generation must still give up resources to produce the munitions hurled at the enemy. In the future, some of our grandchildren will be giving up goods and services to other grandchildren. That is the nub of the matter. The only way in which we can impose a direct burden on the future nation as a whole is by incurring an external debt or by passing along less capital equipment to our posterity.

Funding the Future

Samuelson on the legacy we leave for grandchildren
Richard Murphy

Bear demoted

 

This guy has been really wrong in hindsight … those that took his advice paid a high opportunity cost…

THE BIGGEST BEAR ON WALL STREET HAS FINALLY CAPITULATED

MIKE WILSON THE CHIEF STRATEGIST & CHAIR OF MORGAN STANLEY’S GLOBAL INVESTMENT COMMITTEE IS STEPPING DOWN AFTER YEARS OF BEING WRONG & INCOMPETENCE

MIKE WILSON HAS BEEN PREDICTING A MAJOR STOCK MARKET CRASH FOR YEARS NOW pic.twitter.com/aLey57rNj5

— GURGAVIN (@gurgavin) February 3, 2024

The Smith Family manga continues–Episode 11 is now available — Bill Mitchell

Episode 11 in our new Manga series – The Smith Family and their Adventures with Money – is now available. We are approaching the climax for Season 1. The final episode in the series will be published on February 16, 2024.

Have a bit of fun with it and circulate it to those who you think will benefit …

William Mitchell — Modern Monetary Theory

The Smith Family manga continues – Episode 11 is now available
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Moving to a sustainable system of food production within a degrowth paradigm — Bill Mitchell

As the title says, the post is about "moving to a sustainable system of food production within a degrowth paradigm." The basis of the discussion is whether this can take place within the context of "capitalism." 

Bill argues for the position that it cannot. I have set for reasons previously explaining my agreement with this view. A major reason can be summarized as "perverse incentives." Of course, it is more complicated than that but the rubric "perverse incentives" sums up Marx's notion of internal contradictions inherent in the capitalism system.

However, even granting a critique of capitalism, the fundamental question remains unanswered, namely, how does global production get from here to there. Without specifying a potentially fruitful route the project remains utopian. Bill proposes to undertake at this from the perspective of  André Gorz, a project on which he is now working.

William Mitchell — Modern Monetary Theory
Moving to a sustainable system of food production within a degrowth paradigm
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Will the Hegemon Ever Accept a New Westphalian World Order? Pepe Escobar

Pepe Escobar reviews Prof. Glenn Diesen's new book, The Ukraine War & The Eurasian World Order. 

Escobar recently reviewed Emmanuel Todd's La Défaite de L’Occident (“The Defeat of the West”).

The reviews are short and present views that suggest the world order is changing not only politically but also economically as a result of decolonization. 

This emerging trend portends to grow the pie for all albeit not without growing pains as the dominant parties attempt to maintain their hegemony.

Strategic Culture Foundation (sanctioned by the US Treasury Department)
Will the Hegemon Ever Accept a New Westphalian World Order?
Pepe Escobar

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