tag:blogger.com,1999:blog-2761684730989137546.post7849862514940536775..comments2024-03-28T04:13:36.779-04:00Comments on Mike Norman Economics: Ben Holland — The Secret Behind Growth in Trump’s America Is Deficit Spendingmike normanhttp://www.blogger.com/profile/03296006882513340747noreply@blogger.comBlogger14125tag:blogger.com,1999:blog-2761684730989137546.post-39041790502888180512018-12-24T18:18:43.592-05:002018-12-24T18:18:43.592-05:00Merry Christmas to you too!Merry Christmas to you too!Andrew Andersonhttps://www.blogger.com/profile/14296407661618321637noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-8929992169817744412018-12-24T14:25:33.610-05:002018-12-24T14:25:33.610-05:00Accounts at the Central Bank are inherently risk-f...<i>Accounts at the Central Bank are inherently risk-free and require no deposit insurance. So why can't citizens, at least, have debit/checking accounts at the Central Bank too, alongside those of the banks?<br /><br />As for bank runs, once all privileges for the banks are eliminated, the only remaining depositors at private banks shall be 100% voluntary so why should anyone care, any more than we care about gamblers losing?</i> Andrew Anderson<br /><br />I'm sure you are right about accounts at the Central Bank requiring no deposit insurance, Andrew. One could say that your idea solves the problem of bank runs without the need to protect depositors. All that may be true and I'm happy to agree with that.<br /><br />That, however, does not make deposit insurance a government-given privilege to <b>banks</b>.<br /><br />----------<br /><br />Incidentally, returning for a quick moment to the issue of the wrongness or not of financial speculation as compared to other forms of speculation. I'm happy, too, to leave that subject behind, for I didn't expect we would make any progress towards an ethics or morality-based critique of the notions of speculation and profit.<br /><br />That kind of critique has been attempted since capitalism appeared. We all feel, deep down, that there's something wrong with the notion of "profit". But morality is not the route to find out what's wrong with it. It leads nowhere. The task, in my opinion, is impossible.<br /><br />So, let me propose something. Today's Christmas (a merry one to you and yours, btw). Let's leave things at that. I'm sure we both have better things to do.Magpiehttps://www.blogger.com/profile/07528637318288802178noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-9994403433067236762018-12-24T08:12:50.093-05:002018-12-24T08:12:50.093-05:00#DrainTheScientificSwamp
Ben Holland’s ‘The Secre...#DrainTheScientificSwamp<br /><br />Ben Holland’s ‘The Secret Behind Growth in Trump’s America Is Deficit Spending’ is NOT a secret but old stuff since Keynes.<br /><br />Keynes, Lerner, MMT, Trump and exploding profit<br />https://axecorg.blogspot.com/2017/12/keynes-lerner-mmt-trump-and-exploding.html<br /><br />Keynesianism as ultimate profit machine<br />http://axecorg.blogspot.com/2015/07/keynesianism-as-ultimate-profit-machine.html<br /><br />Egmont Kakarot-HandtkeAXEC / E.K-Hhttps://www.blogger.com/profile/10402274109039114416noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-20517207030056037922018-12-24T03:12:26.254-05:002018-12-24T03:12:26.254-05:00Correct me if I'm mistaken, but I think (1) be...<i>Correct me if I'm mistaken, but I think (1) benefits the depositor, the public, not the banks: in case of a bank run, the government guarantees account-holders their money. </i> Magpie<br /><br />Accounts at the Central Bank are inherently risk-free and require no deposit insurance. So why can't citizens, at least, have debit/checking accounts at the Central Bank too, alongside those of the banks?<br /><br />As for bank runs, once all privileges for the banks are eliminated, the only remaining depositors at private banks shall be 100% voluntary so why should anyone care, any more than we care about gamblers losing?Andrew Andersonhttps://www.blogger.com/profile/14296407661618321637noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-29198379716651472882018-12-24T01:27:22.532-05:002018-12-24T01:27:22.532-05:00Thanks for your reply, Andrew.
Frankly, you lost ...Thanks for your reply, Andrew.<br /><br />Frankly, you lost me with this: <i>I didn't say it was wrong, much less wronger</i>, for you did say before that <i>That's obviously wrong and is a major root of unjust wealth and income inequality.</i><br /><br />But never mind that. <br /><br />This is your list of the privileges the government gives to banks:<br /><br /><i>1) government provided deposit insurance instead of FREE debit/checking accounts for all citizens at the Central Bank or Treasury.<br />2) asset purchases from the private sector by the Central Bank.<br />3) positive yields on the inherently risk-free debt of a monetary sovereign - what Bill Mitchell calls "corporate welfare."<br />4) overdraft privileges for banks at the Central Bank.<br />5) any fiat creation by the Central Bank except for its monetary sovereign.</i><br /><br />Correct me if I'm mistaken, but I think (1) benefits the depositor, the public, not the banks: in case of a bank run, the government guarantees account-holders their money. That's hardly a government-given privilege to the banks.<br /><br />It'a not clear to me what is it you mean with (2), but I imagine you mean something like what the FED did during the credit crunch immediately after the collapse of Lehman Bros (TARP): the FED bought banks' financial assets at book price, when their market price was peanuts. The "toxic assets" thing. If that's what you mean, I'll agree that it looked like <b>almost</b> a subsidy to banks' recklesness (I say almost, because I understand the government made a profit over its investment, so the banks actually paid for the "subsidy"). But the problem is not the fact of buying bank assets, the problem is buying them for an inflated price. Moreover, the money the FED spent doing that came from nowhere and, as I said above, the banks eventually repaid the government.<br /><br />I certainly agree with (3). The solution is simple: don't offer positive yields, like Bill Mitchell says.<br /><br />I see no problem with (4).<br /><br />Again, it's not clear to me what is it you mean with (5). In this case I rather not speculate.Magpiehttps://www.blogger.com/profile/07528637318288802178noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-12781232447524675732018-12-23T23:57:05.277-05:002018-12-23T23:57:05.277-05:00why financial speculation is wronger than other ki...<i>why financial speculation is wronger than other kinds of speculation? </i> Magpie<br /><br />I didn't say it was wrong, much less wronger.<br /><br />My point is that government privileges* for private credit creation, i.e. government privileges for "the banks" is wrong and results in what is, in essence, the use of the public's credit but for private gain.<br /><br />*e.g.s.<br />1) government provided deposit insurance instead of FREE debit/checking accounts for all citizens at the Central Bank or Treasury.<br />2) asset purchases from the private sector by the Central Bank.<br />3) positive yields on the inherently risk-free debt of a monetary sovereign - what Bill Mitchell calls "corporate welfare."<br />4) overdraft privileges for banks at the Central Bank.<br />5) any fiat creation by the Central Bank except for its monetary sovereign.Andrew Andersonhttps://www.blogger.com/profile/14296407661618321637noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-10648662111566121162018-12-23T23:56:58.019-05:002018-12-23T23:56:58.019-05:00why financial speculation is wronger than other ki...<i>why financial speculation is wronger than other kinds of speculation? </i> Magpie<br /><br />I didn't say it was wrong, much less wronger.<br /><br />My point is that government privileges* for private credit creation, i.e. government privileges for "the banks" is wrong and results in what is, in essence, the use of the public's credit but for private gain.<br /><br />*e.g.s.<br />1) government provided deposit insurance instead of FREE debit/checking accounts for all citizens at the Central Bank or Treasury.<br />2) asset purchases from the private sector by the Central Bank.<br />3) positive yields on the inherently risk-free debt of a monetary sovereign - what Bill Mitchell calls "corporate welfare."<br />4) overdraft privileges for banks at the Central Bank.<br />5) any fiat creation by the Central Bank except for its monetary sovereign.Andrew Andersonhttps://www.blogger.com/profile/14296407661618321637noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-81235851383031256282018-12-23T23:06:43.357-05:002018-12-23T23:06:43.357-05:00That's obviously wrong and is a major root of ...<i>That's obviously wrong and is a major root of unjust wealth and income inequality.</i> Andrew Anderson<br /><br />First, Andrew, either you drop the attitude or I'll follow you. I think neither of us will enjoy that.<br /><br />So, let me try for the second and last time.<br /><br />You say it's obviously wrong. It's not obviously wrong for those who profit, is it? They say is obviously right. Why your opinion carries more weight than theirs? <br /><br />-----------<br /><br />But, in fact, the question I asked can be put better in these terms: why financial speculation is wronger than other kinds of speculation?<br /><br />That's the question I posed. You haven't answered it.Magpiehttps://www.blogger.com/profile/07528637318288802178noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-37353500592286680722018-12-23T23:03:50.870-05:002018-12-23T23:03:50.870-05:00This comment has been removed by the author.Magpiehttps://www.blogger.com/profile/07528637318288802178noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-63564700475728709442018-12-23T03:49:32.391-05:002018-12-23T03:49:32.391-05:00and the other (financial) odious, disgraceful, or ...<i> and the other (financial) odious, disgraceful, or sinful?</i> Magpie<br /><br />Unethical fiat and credit creation allows the banks and the rich, the most so-called credit worthy, to profit using what is, in essence, the public's credit but for private gain.<br /><br />That's obviously wrong and is a major root of unjust wealth and income inequality.<br /><br />To be clear, inexpensive fiat creation and low interest rates are, in themselves, both good but HOW fiat is to be created and HOW low interest rates are to be produced is a critical moral concern and determine if profits are justly earned or legally stolen.<br /><br />Thanks for the question.Andrew Andersonhttps://www.blogger.com/profile/14296407661618321637noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-39346971083965825072018-12-22T23:05:41.572-05:002018-12-22T23:05:41.572-05:00speculators profit off the spread between interest...<i>speculators profit off the spread between interest rates and prices.</i> Andrew Anderson<br /><br />That is an odd criticism coming from a non-Marxist, which I believe is your case. <br /><br />To the best of my knowledge, the standard explanation given to profit by non-Marxists is that "one buys cheap and sells dear". One, in other words, profits off a price differential. That's what the guy who buys tomatoes at a farm's door and re-sells them for a profit at the market does. Do you criticise him for that?<br /><br />Isn't that what the homeowner who buys a rural property cheap and sells it dear a couple of years down the track after it was re-zoned as residential does?<br /><br />So, what makes one kind of speculation (tomatoes and property) smart, acceptable, or at least unremarkable, and the other (financial) odious, disgraceful, or sinful?Magpiehttps://www.blogger.com/profile/07528637318288802178noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-62393482687745545992018-12-22T12:22:07.056-05:002018-12-22T12:22:07.056-05:00Rate increases do not control inflation - Noah Way...<i>Rate increases do not control inflation -</i> Noah Way<br /><br />Correct since speculators profit off the spread between interest rates and prices.<br /><br /><i>that's what taxes are for.</i> Noah Way<br /><br />Why allow the Central Bank to create fiat for the private sector in the first place?<br /><br />Also, why not allow the non-bank private sector debit/checking accounts at the Central Bank or Treasury itself to increase the DEMAND for fiat, thus countering price inflation?<br /><br />And why not abolish other privileges for the banks since those allow the banks to create more price inflation than they otherwise could?Andrew Andersonhttps://www.blogger.com/profile/14296407661618321637noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-83029474791480774582018-12-22T12:13:29.186-05:002018-12-22T12:13:29.186-05:00Rate increases do not control inflation - that'...Rate increases do not control inflation - that's what taxes are for. Noah Wayhttps://www.blogger.com/profile/12012500819097539976noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-68276483229644899682018-12-22T12:11:18.426-05:002018-12-22T12:11:18.426-05:00and private credit extension Tom Hickey
Except it...<i> and private credit extension</i> Tom Hickey<br /><br />Except it's not really private but the extension of what is, in essence, the public's credit but for private gain.<br /><br />But no problem because socialism will fix everything anyway - except those who have experienced real socialism disagree.<br /><br />But, of course, they didn't have the right people to run things - except the right people don't believe in injustice to begin with - leaving only the wrong people to try to run other people's lives.Andrew Andersonhttps://www.blogger.com/profile/14296407661618321637noreply@blogger.com