GOP Fight Club

If these libertarian morons really wanted to help the USCoC they would raise the gd "Debt Ceiling!" straightaway....

The “Big Club” Fights Back Against Trump Tariffs – Senate Republicans, Paid by U.S. CoC, Prepare to Mount Assault… https://t.co/ezzJSIrXPG pic.twitter.com/6bBv7UBBAG

— TheLastRefuge (@TheLastRefuge2) June 5, 2019

Richard Murphy — For MMT (long and wonkish)

Contra Ian Stewart and James Meadway.

Aside: If this is considered wonkish in the UK, the country has a problem.

Tax Research UK
For MMT (long and wonkish)
Richard Murphy | Professor of Practice in International Political Economy at City University, London; Director of Tax Research UK; non-executive director of Cambridge Econometrics, and a member of the Progressive Economy Forum

Peter May - Does MMT trump Marxist theory?

Like Peter May, I still think a mixed economy is best. I'm looking forward to the British Labour Party re-nationalizing the railways.

There is an interesting article by Carlos Garciá Hernández here, arguing that Modern Monetary Theory (MMT) renders the Marxist theory of ownership redundant (I wonder if Paul Mason has read it?):

What happened when fiat money was introduced? As we have seen, the state that issues its own money is no longer dependent on any kind of restriction in spending its own money. In this scenario, the private sector can only save in the national currency if the state goes into public deficit, in other words, if the state decides to spend more than it collects through taxes. In this scheme, the “[…] collective or state administration of the production means and of the distribution of goods” doesn’t have to imply the direct ownership of the means of production. This could stay in private hands, because the level of accumulation in terms of national currency in hands of the owners of the means of production is determined by the state through its fiscal policy. Therefore, the administration of the means of production and the distribution of the goods is done by the state, but in an indirect way. This means that the owners of the means of production can only appropriate the amount of money that the state allows them through the collection of taxes, and this also means that the state can spend as much as it considers necessary, regardless of the level of money accumulation in the hands of the owners of the means of production (money is no longer a scarce commodity).

Basically the capture of excess resources by the capitalist class can be counteracted by taxes because the state has a monopoly on money issuance. Neatly he coins this idea ‘Fiat Socialism’.

There is a lot of truth in this idea.

But ownership is still important as it affects attitudes. Owning things, as distributism suggests, changes people’s outlook and encourages a less superficial membership of and a sense of increased belonging to, society. In the old slang people have more skin in the game.

So ownership actually alters values.

Realising where the money comes from is a big step on the way but to get our values right we need to allow everyone to have some ownership. As we accept that ideas influence the distribution of material things, so we need also to accept that distribution of material things influences ideas.

Progressive Voice

Peter May - Does MMT trump Marxist theory?

Carlos Garciá Hernández - Fiat Socialism

Carlos Garciá Hernández argues that socialist parties needn't own the means of production anymore as a way to increase the standard of living and well being of the general population now we have a fiat money system. MMT shows us the way.

Carlos takes a look at Marx’s economic philosophy through an MMT Lens and comes up with his own unique and updated description – fiat socialism

As has already been explained in the second section of this article, such direct ownership of the means of production is an essential condition if we want to control the economy in a collective way inside of the gold standard. This is because in this scenario, allowing the private ownership of the means of production concentrates the spending capacity in the hands of the minority who control the means of production, while the working class can’t hope for a bigger spending capacity beyond the level of subsistence.

What happened when fiat money was introduced? As we have seen, the state that issues its own money is no longer dependent on any kind of restriction in spending its own money. In this scenario, the private sector can only save in the national currency if the state goes into public deficit, in other words, if the state decides to spend more than it collects through taxes. In this scheme, the “[…] collective or state administration of the production means and of the distribution of goods” doesn’t have to imply the direct ownership of the means of production. This could stay in private hands, because the level of accumulation in terms of national currency in hands of the owners of the means of production is determined by the state through its fiscal policy. Therefore, the administration of the means of production and the distribution of the goods is done by the state, but in an indirect way. This means that the owners of the means of production can only appropriate the amount of money that the state allows them through the collection of taxes, and this also means that the state can spend as much as it considers necessary, regardless of the level of money accumulation in the hands of the owners of the means of production (money is no longer a scarce commodity).

The Gower Initiative for Modern Money Studies.

Carlos Garciá Hernández - Fiat Socialism

Jonathon Reynolds - Why Labour doesn’t support Modern Monetary Theory

Oh dear, Bill Mitchell has his work cut out. He quite likes the British Labour Party, probably because it most likely the only real mainstream leftist party left in the first world, well, half of it is, anyway. It's a shame, because if we could have public services without taxing people on average incomes too much we could easily win over the floating voter and maybe even more.


It should also be noted that there is nothing inherently left-wing about MMT – it supporters include members of the Tea Party and Trump supporters in the US. Rather, MMT is a glib, “silver bullet” solution to the major economic problems we face. This accounts for some of its appeal, but in my view it is a direct barrier to winning the battle of ideas about transforming the economy and taking on the establishment with higher taxation. That will need to go even further: more than simply spending more money.

Jonathon Reynolds - Why Labour doesn’t support Modern Monetary Theory

Jesse Colombo - Where Is Inflation Hiding? In Asset Prices

Is inflation much higher than the official figures suggest? Jesse Colombo seems to think so, who says they are closer to 10% rather than the officially stated 2%. And much of the inflation is being hidden in asset bubbles, he says, and will burst eventually. 

One of the primary ways that our modern CPI formula understates inflation is through hedonic quality adjustments. In simple terms, consumer goods that experience technological improvements are considered to have fallen in price when calculating the CPI even if the price has stayed the same or even increased in real life. For example, if a computer with an eight-core processor costs $1,000 today and most computers have sixteen-core processors but cost $1,300 in two years from now, it may get recorded as only costing $800 for the purpose of calculating the CPI. Of course, that’s no consolation to the consumer who actually has to pay $1,300.

Because so many high-tech consumer products have entered our lives over the past forty years and those products have improved at a rapid rate, they have masked the very real inflation that has occurred in big ticket necessities like housing, healthcare, childcare, and higher education. Sure, it’s great that laptops, cell phones, and big screen TVs have been falling in price while gaining more features, but that doesn’t help Americans who are going bankrupt due to exorbitant medical bills, being crushed under the weight of student loans, and can’t find affordable housing anywhere.

The chart below from the American Enterprise Institute shows the dichotomy between high-tech consumer products, which have been falling in price, and big ticket necessities that have surged in price and are becoming increasingly out of reach for many Americans:

https://realinvestmentadvice.com/where-is-inflation-hiding-in-asset-prices/

Andrei Martyanov — On The Virtues Of Modelling

The "modelling" here is using military science–yes, there is such a thing–to model outcomes of military contingencies.

Reminiscence of the Future
On The Virtues Of Modelling
Andrei Martyanov

Bill Mitchell — We are all entrepreneurs now marching towards a precarious and impoverished future

Some years ago, I was a panel speaker at an event in Sydney covering the topic of wage developments. I shared the podium with a young woman who was something like NSW Youth of the Year. It was at a time that employer groups were lobbying the conservative government to abandon penalty rates for workers in low-wage industries (hospitality, tourism, etc) and strip powers from trade unions. I spoke about how that agenda was designed to advance their class interests and fitted squarely with the neoliberal intent to redistribute real income away from workers towards profits. The young woman followed and announced that class was dead and that there was no such thing as a worker anymore – she said “we are all entrepreneurs now!”. Prior to that, as our national government was privatising our public companies such as Qantas and Telstra, our prime minister announced “we are all capitalists now” referring to the idiocy of people buying shares in the companies that we collectively ‘owned’ anyway while they were in public hands. The more recent manifestation of this delusion that class is dead and we are all entrepreneurs is the so-called ‘gig economy’. It seems that we now have millions of people (first young but increasingly older) who think that entrepreneurship is about buying a cheap scooter and tearing around streets delivering pizzas in all weather to earn a few dollars while the companies that ’employ’ them (or rather contract them) walk away with millions. These workers, sorry, entrepreneurs, face a bleak future. When there are no pizzas being ordered they have no shifts. When they are sick they have no pay. When they go on holidays they have no pay. And when they get old they will have no superannuation. Sounds like a plan to make someone rich....

Who says that "MMT" doesn't talk about class and power? 

OK, I get that Marxists and Marxians that criticize MMT for ignoring class and power mean that MMT economist are working within the capitalist system, which cannot be reformed according to Marx, an observation with with I agree. 

MMT economists are more in the institutionalist model in opposing neoclassical economics and its derivatives. Institutionalism (since Veblen) tends toward a non-Marxist approach to the paradoxes of liberalism generated by oppositions among economic liberalism, social liberalism and political liberalism owing to liberalism being bourgeois liberalism in which property and property accumulation and fundamental. This results in hierarchies of power.

Why do I say MMT is "institutionalist" rather than Post Keynesian or free standing? Because MMT begins with an analytical description of "money," and "money" is a social institution rather than a "natural"entity or process. MMT is descriptive of a "monetary production economy." Monetary production economies are not necessarily "capitalist" economies, depending on the definition of "capitalism." But developed economies since the beginning of the Industrial Age are capitalist-dominated.

Another reason that MMT can be classified as being institutionalist is that society is partly natural, insofar as it is a biological system, and partly institutional, also being historical and cultural, which are not accounted for by evolutionary theory. Neoclassical economics doesn't recognize this, holding that economics is based on natural laws, while Institutionalism does, following Marx here, who was prior in emphasizing this. While Marx and institutionalism views humanity as both individually embodied and socially embedded, neoclassical economics views humanity as an aggregate of homogenous individuals that can be treated as physics treats atoms. 

Why is this important? Because there is a current debate running about MMT and class and power, so holding that MMT doesn't sufficiently deal with these. MMT economists claim that they are as as institutionalists that reject neoclassical assumptions, which is true.

However, the result of the different analyses, MMT and Marx-based, is that MMT policy is social democratic and Marx-based is democratic socialist. (Bernie Sanders is a social democrat rather than a democratic socialists, as he calls himself.) The difference is that socialism is a different economic system than capitalism, while social democracy as the term is presently used is a mixed economy. 

(Note that some of the right reject this distinction, following Hayek to claim that a mixed economy is the beginning of the slide away from capitalism toward socialism as an inevitable consequence and therefore to be avoided at all costs.)

If society is a system involving social, political, and economic aspects, then sociology, political theory, and economics cannot be disentangled, as both Marx and institutionalism assume while neoclassical economics rejects.

This is the direction that the public debate is taking, occasioned by MMT going viral and becoming a political factor.

Bill Mitchell – billy blog
We are all entrepreneurs now marching towards a precarious and impoverished future
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Ian Stewart - MMT: an alchemic theory that could destroy the economy

This is a very brief article where it doesn't seem like Ian Stewart has thought through MMT all that much st all as he just relies on what he has been taught about the government printed money and inflation.

Ian Stewart is happy with printed money being spent on assets keeping their prices high, but not on public goods a services. And he says that MMT will crowd the private sector out, something that MMT economists are always very careful about.

Now, it’s worth noting that both MMT and QE involve the government creating money electronically – or, more graphically though incorrectly, printing it. But with QE a central bank creates money to buy assets, such as government bonds. This injection of new money into the system drives down interest rates and bolsters asset prices. Under MMT, by contrast, the government spends the money directly on public services.

That’s one crucial difference, and from it a second follows. With QE, as practised in the US and Europe, central banks have promised to reverse money creation. They can do so because, unlike under MMT, the money that has been created has been swapped for assets which can be sold. The idea is that central banks will, in time, sell these assets, withdrawing money from the system and dampening asset prices and activity. This has so far convinced investors that the new money created will eventually be absorbed back into the system. The message from central banks is that QE does not represent a permanent expansion in the supply of dollars, euros and pounds.

By contrast, the money created under MMT will be spent on public services and not in purchasing assets. And, since there are no assets to sell in future, the money creation is permanent.

These are important differences. They explain why so many prominent US economists, from Fed chair Jay Powell to former treasury secretary Larry Summers, have raised concerns over MMT.

Reaction

Ian Stewart - MMT: an alchemic theory that could destroy the economy

Dirk Ehnts — Modern monetary theory: a simple macroeconomic model

Why has modern monetary theory come out of the academy? Because it helps model the current economic predicament and how to get out of it.

"Anything we can actually do we can afford. Once done, it is there."John Maynard Keynes (1942)

Excellent post by MMT's representative in Germany.

It's a bit wonkish (graphs and variables) but it is addressed to a higher level audience than a popular venue and the math is kept simple. Probably not any more wonkish than the posts that Paul Krugman labels as wonkish.

I would have started with the sectoral balance graph that most explicators of MMT use. First, it is likely to be familiar, and secondly, it brings the point home strongly. I suggest that this is the graph that should be the basis of the elevator speech on MMT.

But posts are limited by space, the authors have to take into consideration the one big ideal they want to get across. Dirk Ehnts does excellent work with the space allotted.

Social Europe
Modern monetary theory: a simple macroeconomic model
Dirk Ehnts | Lecturer at Bard College Berlin

TGA Stability

Looks like the Treasury is using 'extraordinary measures' to keep the TGA stable as they juggle things under the Debt Ceiling...

This is a good sign that these morons might actually be starting to figure it all out...

What would have been a very large net disbursement from the TGA and associated price volatility inducing large increase in Reserve Assets in the banking system on Friday was offset by what appears to be Treasury not rolling over the exact amount of Intra-government Series Treasury securities and instead increasing issuance to the public to decrease Reserve Assets at the banks.

TGA (and thus Reserve Assets) maintained complete stability and avoided what could have been at least a volatile price day if not yet another moron induced crash in Risk Asset prices...

We might have dodged a bullet here...

U.S. Retirements

10,000 per day now...  Transfer payments of Social Security and Medicare starting to dominate the growth in leading fiscal flows... mega-trend will continue for years...

More than 10,000 people are now retiring each day in the U.S. But this daily retirement figure may fall by close to 2,500 people from an expected peak in the year 2023 to the year 2042 https://t.co/8tKzcfRiRS

— Bloomberg Economics (@economics) June 4, 2019

U.S. May Auto Sales

Solid U.S. new care sales increase in May:

Major automakers post U.S. higher May new vehicle sales https://t.co/q87EDk0TGN pic.twitter.com/l1H8XEuAWQ

— Reuters Top News (@Reuters) June 3, 2019

From Mike's latest report:

Auto loans were up $0.4B to $435B a new high.  Auto loans have risen 21 weeks in a row for a total of $12B. The growth rate increased by one-tenth to 3.3% YoY.  This is the fastest in 2 years.

James Meadway - Against MMT

Modern Monetary Theory disorients the Left by peddling simplistic monetary solutions to complex problems of political power.

James Meadway is an economics adviser to the British Labour Party, who in this article is very critical of MMT. James Meadway says MMT can only work well in the US because the dollar is the world's reserve currency and it wouldn't be so effective in Britain. 

MMT is also far too soft on the financial sector, says James Meadway, which is in need of serious reforms as powerful as those that Thatcher implemented but in reverse. 

Well, whatever your views on MMT, I found James Meadway's article to be a very powerful read. I'm fed up with halfway measures and the sort of compromises that led to New Labour. It's time to sort this out, and the military industrial complex with all its swamp creatures. 

Here's an excerpt to whet your appetite. 

Worse, the very existence of a large financial system, vulnerable to shocks, creates a domestic pressure to reduce public spending. The logic is simple, as described by the former Chief Economist of the IMF Maurice Obstfeld: if we have a bloated financial sector, it is at increased risk of the kind of crash that will require bailouts in one form or another — either directly to financial institutions, or indirectly through vast deficit spending by government. The risk of this future crash drives austerity today, which is what the Tory chair of the Public Accounts committee meant when he said there was not enough ‘national borrowing capacity’ to cope with our ‘exposed and vulnerable’ financial system.

To end austerity permanently, we have to transform how our financial system works, reducing its exposure to the risk of a major collapse. And to transform finance, we need a slow, methodical process akin to defusing a bomb — not a further explosion. It will mean ‘structural reforms’ to our economy — building new institutions to deliver investment, like the regional development banks; changing the ownership and control of productive assets, for example through the Inclusive Ownership Funds — issues on which MMT advocates are usually silent.

Tribune

James Meadway - Against MMT

Pepe Escobar — Far from quiet on the US vs Russia-China front

As Valdai Club top analyst Yaroslav Lissovolik told me, there was much discussion “on the state of play in emerging markets in light of the developments associated with the US-China trade stand-off.” What emerged was the necessity of embracing “open regionalism” as a factor to neutralize “the negative protectionist trends in the global economy.”

This translates as regional blocks along a vast South-South axis harnessing their huge potential “to counter protections pressures”, with “different forms of economic integration other than trade liberalization” having preeminence. Enter “connectivity” – BRI’s premier focus....

Asia Times
Far from quiet on the US vs Russia-China front

Pepe Escobar

Thomas Fazi — French Colonialism Is Alive and Kicking in Africa, Has the Continent in an Iron Grip

Thomas Fazi is an Italian journalist and collaborator with Bill Mitchell on several books.

The US is not the only neo-imperialist. It is joined by France and Great Britain.

spiked
French Colonialism Is Alive and Kicking in Africa, Has the Continent in an Iron Grip

Thomas Fazi

See also

Disproportionate focus on corruption of national leaders distracts from the systemic theft of Ghana's wealth

Slate
98.3 percent of Ghana’s gold remains in the hands of multinational corporations

Celina Della Croce

Godfree Roberts — Everything About the BBC/CNN Account of Tiananmen Square Is a Lie

Another side of the narrative. Longish and detailed, including eyewitnesses to events. US-supported attempt at regime change, with US spin after its failure?

While the article doesn't mention it, the chief opponents of the present Chinese policy comes from Marxist-Leninist student that think the socialist revolution is being betrayed.

Checkpoint Asia
Everything About the BBC/CNN Account of Tiananmen Square Is a Lie

Godfree Roberts

See also

The Truth About the Iconic Tiananmen “Tank Man” Photo
Marko Marjano

Cody Cain - No, Mr. President: China didn't steal our jobs. Corporate America gave them away

If you move all your expertise and factories to another country, train the staff there how to use the technology, and school them in our universities, then you have to be pretty dumb not to expect those people to use that knowledge not to build their own technology in the future.  We gave it away.

Our response it's not to design and build our own better technology, but to pump money into the military industrial complex instead to force other nations to heal. Which is a big earner for the military industrial complex investors.

We couldn't have done everything more wrong, including not investing in green energy, which would have paid off extremely well because everyone wants low cost, clean fuel.

Our leading 'job creators' and 'entrepreneurs' are not so smart after all. Or perhaps they were rather cute, as they made themselves a lot of money out of it - selling the nation down the river. Paul Craig Roberts says they should be put on trail for treasin. It just goes to show how the market can get it all wrong.

Trump's trade war points the finger in the wrong direction. China behaved normally; corporate CEOs betrayed us
China is not “stealing” American jobs.

President Trump loves to blame China for the job losses that have devastated American workers under globalization. But the truth is that Trump is blaming the wrong party. Trump’s reckless trade war against China is misguided and amounts to a colossal charade that will not solve the actual problem.

Yes, it is true that numerous American manufacturing jobs have been shipped overseas to China, thereby leaving American workers jobless and suffering. But China did not steal these jobs.
No. These jobs were given to China. It was all legal and legitimate. China merely accepted the gift.

What would anyone expect China to do? Accepting these jobs was a perfectly rational course of action.

China was an underdeveloped nation with a large population of poor people willing to work for a fraction of the hourly wages of American workers. And then corporations came along and presented China with an attractive offer: We would like to build manufacturing plants in China and hire droves of your unemployed people to work there. What was China supposed to do? Naturally, China said yes.


This is hardly stealing.

Information Clearing House

No, Mr. President: China didn't steal our jobs. Corporate America gave them away

Louis Staples - Ben Shapiro's historic comments about climate change have gone viral again because of how idiotic they are

Ben Shapiro believes there is a market solution for everything.

One of the best and worst things about the internet is, when someone says something stupid, it follows them forever.

Right-wing commentator Ben Shapiro – who you might remember was recently schooled by the BBC’s Andrew Neil live on air – has found this out the hard way.

A ludicrous clip has re-emerged of Shapiro arguing that climate change won’t be such a big deal “if the sea level rises five or ten metres” because people will just “sell their homes and move”.

Yes, really. This is where we’re at.

Hilariously, comedian @Hbomberguy mashed together a hilarious video, which mocked Shapiro’s strange argument.

The clip ends with him recreating a scene from The Shining, screaming:

Just one small problem. Sell their houses to who, Ben?
F****** Aquaman?!

 Ben Shapiro's historic comments about climate change have gone viral again because of how idiotic they are

digby — You wanna trade with the US? Well, we own you if you do.

It's hard to believe an American Ambassador would say this but in the Trump era, it's completely normal...

Just being honest. It's called imperial prerogative. Historically, this is the tradeoff when there is an empire. The American Empire is just being true to form.

Hullaballoo
You wanna trade with the US? Well, we own you if you do.
digby

David P. Goldman — Washington is wrong about China’s economy

David P. Goldman puts some numbers on it.

Asia Times
Washington is wrong about China’s economy

David P. Goldman puts some numbers on it.

See also

Gold, Goats 'n Guns
What’s the Plan Mr. Tariff Man?

Tom Luongo

See also

Tom Dispatch
Tomgram: Michael Klare, Fighting the Next War, Not the Last

See also

NEO
New US Ambassador to Uzbekistan – You Just don’t Wanna Know

Martin Berger

See also

The Vineyard of the Saker
Special China SITREP & Analysis

Larchmonter445

See also

Fortune
China Is Creating A “Greater Bay Area” To Rival Silicon Valley. What Will It Mean for Hong Kong?

Eamon Barrett

Adam Garrie — Malaysian Prime Minister Mahathir Mohamad Makes Incredibly Important Speech Endorsing Gold Standard

Veteran Malaysian Prime Minister Mahathir Mohamad has made a speech calling for all of east Asia to begin trading on the basis of a new currency based on a classical gold standard. While Mahathir did not suggest that this currency should be used to settle daily transactions between individuals, he proposed that a gold backed pan-Asian currency should replace the US dollar as the standard currency used in bilateral trade among Asian countries....

Mahathir’s statement comes at a time when the dollar continues to show strength vis-a-vis is levels during the economically stressed Bush and Obama eras. That being said, not only are the strong dollar and de facto quantitative tightening policies of the US Federal Reserve putting pressure on developing countries but more importantly, Washington’s fervour when it comes to sanctions and non-tariff trade barriers is making the dollar based financial system increasingly unattractive to countries that are not in America’s immediate circle of allies....

Good article. It's really a reaction to the USD and dollar hegemony.

Eurasia Future

Mahathir Mohamad Makes Incredibly Important Speech Endorsing Gold Standard

Adam Garrie


See also by Adam Garrie

China Has a Supreme Qualitative Advantage in The Trade War

Tucker: People are mad at Assange instead of Obama

Tucker Carlson is spot on again.

Central Bank Required Reserve Ratios

Table of current RRRs for many countries at Central Bank News here. (Try to just ignore the common reification error  of "lend out the reserves!" these people typically make here for now...)

TURKEY Central Bank of Republic of Turkey 16-Feb-19 7.00% 8.00%

UNITED STATES 1) Federal Reserve 27-Oct-16 3.00%

URUGUAY Central Bank of Uruguay 1-Apr-13 25.00% 20.00%

UZBEKISTAN Central Bank of the Rep. Of Uzbekistan 1-Sep-09 15.00%

VENEZUELA Central Bank of Venezuela 25-Oct-13 19.00% 17.00%

U.S. listed at 3% , based on system level (H.8)  Deposit Liabilities of $12T that 3% would put required system level reserves at about $360B;

Meanwhile latest H.4.1 from the Fed has total system reserves at $3.900T and those of Federal Reserve Banks at about $1.544T; the rest being in currency, TGA and other non-Reserve Bank accounts...

So its hard to understand how any significant demand for Reserve balances could be being caused by the Reserve Requirement Ratio as the system has up to over 10x the minimum mandated by the RRR...  current Reserve demand, if there effectively really is any, is being caused by functional regulatory policy(s) other than the RRR.

So I don't see why anyone would want to always be dogmatically stressing the functionality of Reserve demand  to meet the RRR in their Theory all the time these days... doesnt seem applicable for the last 10 years or more... ever since added system Reserves went asymtotic in September 2008 and caused the crash...

Andrea Germanos — Edward Snowden: With Technology, Institutions Have Made 'Most Effective Means of Social Control in the History of Our Species'

NSA whistleblower Edward Snowden said Thursday that people in systems of power have exploited the human desire to connect in order to create systems of mass surveillance.

Snowden appeared at Dalhousie University in Halifax, Nova Scotia via livestream from Moscow to give a keynote address for the Canadian university's Open Dialogue Series.
Right now, he said, humanity is in a sort of "atomic moment" in the field of computer science.

"We're in the midst of the greatest redistribution of power since the Industrial Revolution, and this is happening because technology has provided a new capability," Snowden said.

"It's related to influence that reaches everyone in every place," he said. "It has no regard for borders. Its reach is unlimited, if you will, but its safeguards are not."...

Common Dreams
Edward Snowden: With Technology, Institutions Have Made 'Most Effective Means of Social Control in the History of Our Species'

Andrea Germanos

See also

Frustrated by a legal ban on sharing intelligence with Israeli operatives conducting targeted assassinations against Hezbollah, the NSA crafted a loophole giving them total access even to US citizens' data, leaked documents show.

The Israeli SIGINT National Unit (ISNU), the NSA's counterpart in Tel Aviv, convinced the Americans to circumvent the legal prohibition on providing surveillance data for targeted assassinations during Israel's 2006 war with Lebanon, according to the newest revelation from the archives obtained by whistleblower Edward Snowden.…

RT — Question More
‘Most valued partner’: NSA fed Israel intel for targeted assassinations, leaked docs show

Zero Hedge — Trump Declares Trade War On India, Imposes New Tariffs

No surprise, actually. Same policy as toward China requiring "reform" allowing the US to compete equally in their domestic markets. India and China have no intention of allowing foreign entities control the commanding heights of their economies through "investment." It's a national security issue, just as the US approaches this domestically itself. This is basic to neoliberal globalization that effectively colonized the rest of the world. Nothing new here, either. It is typical of empires.

Under the decades-old program - known as the Generalized System of Preferences - Indian companies were able to avoid some $5.7 billion in duties back in 2017.
The new standards will take effect June 5.

"I have determined that India has not assured the United States that India will provide equitable and reasonable access to its markets," Trump said in a proclamation on Friday evening. "Accordingly, it is appropriate to terminate India’s designation as a beneficiary developing country effective June 5, 2019."

The decision isn't unexpected: The White House warned back in March that it could end India's preferential treatment if India didn't agree to certain reforms, but it decided to hold off so as to not hurt Modi politically during the run up to the election. According to Bloomberg, Trade Representative Robert Lighthizer has become increasingly frustrated with India’s trade barriers and practices. The trade rep has taken issue with the country’s self-designation as a developing nation at the World Trade Organization....

Zero Hedge
Trump Declares Trade War On India, Imposes New Tariffs
Tyler Durden

Scott Fullwiler —— Quick(?) MMT 101 lesson (Twitter thread)

Thread by @stf18 at threadreaderapp.com

1. Quick(?) MMT 101 lesson:
From the very beginning in the 1990s, MMT has NEVER argued that 'printing money' was necessary. Anyone saying MMT = "print money," even if they (correctly) incorporate an inflation constraint, is getting MMT dead wrong.

2. The argument from the earliest days--@wbmosler 's "Soft Currency Economics," Wray's "Understanding Modern Money," or @StephanieKelton 's "Can Taxes & Bonds Finance Govt Spending?"--the MMT argument is that ALL govt deficits are 'printing money' ALREADY (!).

3. These and other foundational, early MMT pieces argue that the choice to issue bonds or not is about monetary policy how to set the CB's interest rate target, not whether to 'finance' a deficit or 'print money.'

4. The argument across literally dozens of publications is consistent--whether or not govt issues bonds when it runs a deficit, the macroeconomic impact of 'bonds vs. money' is nil.

5. What matters for macro impact is the deficit itself, and how it is created (spending/taxing priorities), since the deficit is creating net financial wealth in the pvt sector (note I did NOT say 'real' wealth (!)).

6. The choice to issue bonds or not in the face of a deficit is simply about 1 risk-free govt asset (say, Tbills) vs. another risk-free govt asset of perhaps slightly longer maturity (but that's also a policy choice).

7. This is also partly why we predicted back in the 2001 that Japan's QE wouldn't be inflationary, and predicted the same for the US in 2008. QE & 'monetization' of govt debt is about an asset swap--it's the deficit itself that has the 'quantity' effect, not the financing.

8. Similarly, in the real world, CB's are defending their national payments systems every minute of every day. This means they accommodate banks' demand for CB liabilities always at or near their current interest rate target.

9. From an MMT perspective, it's really weird that people believe a govt running a deficit via overdraft at the CB is inherently inflationary, but the current system, where govt runs a deficit while CB guarantees mkt liquidity for bond dealers to buy govt bonds, isn't.

10. So, from the beginning 20+ yrs ago, MMT said the 'choice' to issue bonds when running a deficit was about how to set CB's int rate target. W/ bond sales, CB accommodates banks at its tgt rate. W/o bond sales, CB sets rate at ZIRP or uses IOR=tgt rate to set tgt rate <> 0.

11. This is just supply and demand from ECON 101. If you push out the supply curve beyond the entire demand curve, either the price falls to 0 or you have a price floor set at <> 0. Those are the only 2 possibilities when 'printing money' to run a deficit.

12. Neoclassicals actually agree w/ this, for different reasons. For them, if 'monetize' govt debt & CB rate = 0, 'monetization' isn't inflationary. Or, if CB sets rate <> 0 via IOR=target rate, still not inflationary.

13. In both cases, CB's reserves are considered effectively equivalent to holding, say, Tbills. So, 'monetization' or 'printing money' is effectively equivalent to 'printing' Tbills. IOW, if you blend neoclassical model w/ actual CB ops, 'printing money' isn't inflationary.

14. Putting this all together . . . MMT has NEVER argued that 'printing money' as conventionally interpreted is necessary to carry out MMT policy proposals. All deficits create net financial wealth for pvt sector, regardless of 'finance' method.

15. Choice to issue bonds or not when running a deficit is about how to set CB's target rate, not 'financing' a deficit. This means that interest on national debt is a policy variable, or at least can be (for monetary sovereign, of course).

16. So, choice to issue bonds or not is not about 'quantity' impact of a deficit, but about 'how' CB chooses to achieve its target rate. Hitting interest rate tgt by overdraft to govt & pay IOR=tgt rate=2% has no difference of macro significance from . . .

17. ... hitting interest rate target by govt instead issuing tbills while CB ensures mkt liquidity at tgt rate = 2% to banks & bond dealers.

18. Now, there are places where MMT scholars argued for no bond issuance, govt gets CB overdraft, & CB sets tgt rate= 0 (permanent ZIRP). Note, tho, that this is (a) not arguing in favor of 'printing money' even in neoclassical view (it's Krugman's liquidity trap, actually) ...

19. (b) and is therefore, simply a policy proposal for low interest rates on govt debt. It is also NOT arguing for ZIRP in a neoclassical world--Wray did his Ph.D. under Minsky. Minsky was against manipulating short term rates; instead favored credit regs/margins of safety.

20. That is, when MMT proposes ZIRP, it is proposing it for ONLY the govt debt, NOT for the economy overall as in a New Keynesian model. There are dozens of MMT publications on regulating credit, and more on the way. MMT was about macroprudential before that was a thing.

21. Minsky was adamant that manipulating short-term interest rates was actually destabilizing (he blamed the rise of money manager capitalism on Volcker's high rates). Raise margins of safety to slow credit rather than raising the overnight, risk-free rate.

22. A benefit of margins of safety is that raising interest rates to slow credit leads to higher hurdle rates that can only be met by riskier projects, while raising margins of safety slows credit by favoring the LESS risky loans.

23. Particularly given that the problem of a debt bubble is that credit QUALITY is bad, it's really weird from an MMT perspective that it's mostly MMT arguing in favor of macro policy that target credit quality ...

24. ... while neoclassicals go to lengths to NOT talk about credit quality--use a Taylor rule to manipulate short-term rates, increase liquidity requirements, increase capital, but little to nothing about underwriting. (Shocker--we now have a corp debt bubble.)

25. So, MMT is NOT arguing for 'printing money' and 'ZIRP' in the conventional, neoclassical world. MMT is arguing for stabilizing demand side of the economy w/ a mix of govt's budget position (at low rates, however 'financed') & credit quality/margins of safety.

See also

The Gower Institute

A Brief introduction to Modern Monetary Theory

Timothy Taylor — Pareidolia: When Correlations are Truly Meaningless

"Pareidolia" refers to the common human practice of looking at random outcomes but trying to impose patterns on them. For example, we all know in the logical part of our brain that there are a roughly a kajillion different variables in the world, and so if we look through the possibilities, we will will have a 100% chance of finding some variables that are highly correlated with each other. These correlations will be a matter of pure chance, and they carry no meaning. But when my own brain, and perhaps yours, sees one of these correlations, I can feel my thoughts start searching for a story to explain what looks to my eyes like a connected pattern.…

Classes in statistics emphasize that "correlation doesn't mean causation." The lesson here is even stronger. Correlation doesn't necessarily mean anything at all.Classes in statistics emphasize that "correlation doesn't mean causation." The lesson here is even stronger. Correlation doesn't necessarily mean anything at all.

Conversable Economist
Pareidolia: When Correlations are Truly Meaningless
Timothy Taylor | Managing editor of the Journal of Economic Perspectives, based at Macalester College in St. Paul, Minnesota

Revisions to the Supplementary Leverage Ratio for Custodial Banking Organizations and Custody Banks

Proposed Rulemaking out last month from the OCC, its taken like a year to come up with this proposal in response to the bank reform Act passed last year.  Nothing like a sense of urgency...

Agencies Seek Comments on Revisions to the Supplementary Leverage Ratio as Required by Economic Growth, Regulatory Relief, and Consumer Protection Act https://t.co/MVezVBn0L2

— OCC (@USOCC) April 19, 2019

Looks like weak tea anyway.

Probably not going to help much towards achieving legal mandate for stable prices; reads as if only 3 institutions qualify:

Based on data available at the time of the proposal, only The Bank of New York Mellon Corporation, Northern Trust Corporation, and State Street Corporation, together with their depository institution subsidiaries, would be considered predominantly engaged in custody, safekeeping, and asset servicing activities and therefore able to exclude deposits at central banks from their supplementary leverage ratio.

Continued chaos... looks like during the periods of high Reserve Asset fluctuation; denominator in depository system SLR still going to vary by 100s of $B.

Instability creates instability; except for morons...

Randy Wray - MMP Blog 38: MMT for Austrians

I got this from Magpie's blog, which is by Randy Wray and is very good. It's old, from 2012, so you are probably all familiar with it, but I still thought it was worth posting.

Randy says how the free market equilibrium theory, the invisible hand, is a myth. Economists did manage to work out a formula for it after 80 years of trying, but it is based on everything being perfect, like being perfectly informed, eg, advertisements are completely honest, and there is no market manipulation. Some hope there.

What I found interesting is that if MMT is used to buy military equipment it would be inflationary, says Wray.

Can we “afford” full employment? Yes. Can we “afford” Social Security? Yes. Can we “afford” to put wine in all the drinking fountains? Yes.

The problem IS NOT, CANNOT BE about affordability. It is about resources.

Unemployment is easy: by definition, someone who is unemployed is available to hire. So government can put them to work. (See the next blog series for a plan.)

Social Security is a little more difficult: can we move enough resources to the aged (plus their dependents, and people with disabilities) so that they can enjoy a comfortable, American-style, life? On all reasonable projections of demographics and US ability to produce, the answer is yes. The projectionscould turn out to be wrong. But if they do, affordability still will not be the problem—it will be a resource problem.

New Economic Resources

http://neweconomicperspectives.org/2012/02/mmp-blog-38-mmt-for-austrians.html