Lucky lab, it's gone positively Victorian up here. Blowing it's arse off and raining. I'm picking up a stumpy tail cattle dog in a few weeks for my wife. We lost our Border Collie Xmas Eve last year. I was hoping to be dogless for a while longer but she craves the companion of a canine. Happy wife happy life.
MMTers argue that it is through taxation that governments can control inflation ie the capacity for the private sector to spend. That and the fact that by creating a tax liability in the first place we are all forced to adopt the monopoly fiat currency of the State. This is not the best analogy but it's the only one I can find. I prefer the parent/child allowance one where you force your kids to accept your rules or kick them out but I can't remember where I saw it. The relevant part is from 28:06 to 30:23. It's Mosler explaining how governments can only create a tax liability by issuing currency in the first place. Then what happens is that the government can manipulate the amount of currency (and as a result inflation and prices) in the market via taxation, and government spending, in order to maintain the optimum economic conditions that work to best enhance wealth for everyone. It's simplistic as he agrees, but that's generally how it works under our current system.
I'm pretty sure I said that MM theory doesn't concern itself with whether it's public or private spending driving the economy, as long as one of them does, and I'm pretty sure that I said that Austrian economists argue that consumer spending is not the main driver of the economy, contrary to what Monetarists and Keynesians maintain. I guess that's what sets MMTers apart from from Austrians and Monetarists is that they maintain that deficit spending is not a problem. And I happen to agree with the. And I'm an Austrian. Taxation according to MMTers controls the amount of inflation ie the amount of currency in circulation. The "private sector spending is of no consequence" comment was my response to your argument that consumer confidence was down and would therefore drive asset prices lower as a result of deleveraging. I said that consumer spending (private spending) is of no consequence at the moment as the public sector will fill the void.
Nice choice. We have one. Seventeen years old and still tears the palings off the fence with his teeth to get to the dog next door when she's on heat. Never mind the curvature of the spine, Hip Displasia, prolapsed prostate and arthritis. He's like a diesel engine. You'll have your hands full but they're a great breed. Loyal, Intelligent and tough with enough of an independent streak to keep you on your toes. Prefers the front seat when going for a drive.
This is where I find it difficult to accept. Everything has a value to begin with. That depends on the supply and demand of that valued product. With credit, there is no value to begin with. It's a liability that eventually someone has to pay. A valued product, whether US Dollar - Gold - Bitcoin - has to be set according to the supply demand of that product and floated. The reason for Gold failing at various times wasn't because there wasn't enough of it to match Government debts. It was initially having a fixed price for it. When people say that Gold can't compete in today's financial society. Well, I would argue just the same as fractional reserve lending, both Bitcoin and Gold pricing is no different. You continue to add the zeros to what you believe is fair price for Gold by weight, or Bitcoin and let the market decide. Now, if there were only 100 mln USD notes in the world, wouldn't it be fair to say that there would be very high demand for US Notes and people would pay a premium just to have a few. You would be able to go out and spend those notes with greater purchasing power. What if those same US Notes that once had great value where you could buy so much with only a few notes, suddenly you find that the printing presses have been going ballistic over recent times and now you find your purchasing power has diminished because of a massive increase in the supply of US Notes. Thats my point, if you increase the Money supply to an extreme, with no brakes, sure it goes through financial and banking system first. However, after their large slice of the pie, the 99%'ers are left with the crumbs. Your purchasing power has diminished and you are left with paying authoritarian style taxes. That is not an equal level playing field. Both governments are drinking the cool-aid believing that perpetual growth is always achievable. No point creating massive sinkholes of debt for governments to say "Look how good we are. We achieved growth." To achieve that growth, there is a cost to society. IMHO, we need to swallow the bitter pill, man up, pour investment back into our own manufacturing, cut immigration to a busload and to F... with anyone else. It's about time Australian Governments looked after their own citizens. Now I will pat my "Doggy" Luka. She is coming up to her 12th Birthday soon. Shiney, important to keep a doggy in your family. Cheers Markco2
What a great looking little doggy. What are you going to call him? Scruffy Nuts or Nonuts Cheers Markco2
She is Kelpie cross Lab. Even in her twilight years she still wants me to throw the ball so she can fetch. Love my Dog plus my Moggie and some left over for the Missus as well, only when she is good. Cheers Markco2
It seems to me that the people pulling the levers are the answer to these questions. They are extremely intelligent and live in a bubble and can summon forth any figures or activities they wish. When Elon Musk says "people have to make things or otherwise you can't have things" he is both simplistic and profound - but his point is unrelated to what is called "the economy ". Subsidies, tariffs and quotas disguise the true picture. "The economy" referred to in most discussions is a chimera since money printing, false reporting and political involvement in tension with those uncontrollable central banking moves and deceit, creates artificial outcomes. I did a year of economics at university and foolishly didn't swap out after the first lectures. The assumptions required to come to theory, to my mind, rendered the entire discipline irrelevant to the real world. The main thing I learned was the truism that economics is the painful elaboration of the obvious.
Your experience at Uni would've been painful because the lecturers adhered to a school of economic thought that is designed to complicate the world and give them authority. Basically, they had maths envy. And they created elaborate and painful formulas to justify themselves. Economics is not difficult at all, or it shouldn't be. That's why I can understand it. It's just the study of human behaviour - why people want things, how they get those things and how they make choices between the different things they want. MMT is not difficult to understand at its basic level until you start listening to the professional economists in their ranks, this is why I like Mosler, he's not an economist. Austrian Economics is even easier to understand, it's just a theory of behavioural psychology, no formulas, just logic and guidance for how to best help individuals meet their needs.