"Elon Musk is Wrong Again" Top Economist Warns the US

[@Puzekat2]

“Accounting is the law and everything else is fraud” you have my attention. I am a bookkeeper, and I love the algebraic equation that never lies.

[@ProfSteveKeen]

Thanks! You're a welcome relief from some of the trolls who have dominated comments here recently. I'd be interested in your reactions to Ravel: it's $1/month at www.patreon.com/ravelation for the modelling-only version, and $7/month for the modelling and data analysis version.

[@si2536]

😂Yeah. The equations never lie unless they are modelled by liars...

[@ProfSteveKeen]

@@si2536 Well whatdya know, another troll...

[@fghhgdgdggskkk]

@@ProfSteveKeen Mate you're on youtube referring to yourself in video titles as "top economist warns US". Who is the troll again?

[@Oo_Shade_oO]

Elon needs to stay in his own lane. Even if I agree with him on some things, he's getting way to big for his britches.

[@fghhgdgdggskkk]

Stop drinking the kool aid and recognise it for what it is. What is his lane exactly? He doesn't have one. He's in everyone else's lane all the damn time and tells the world it's his lane.

[@JohnDaniels]

"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless" -Thomas Jefferson

[@du5tman]

Private banks already own the National Treasury...

[@niko-qi1oi]

Government-Sachs

[@starcorpvncj]

@@JohnDaniels Testing if my reply to this post is blocked are as the replies actually sent to me.

[@mikekelly5869]

The Fed is private

[@RoobieRhoo]

@@mikekelly5869 Yes, the Fed is a private bank with a government mandate for price stability and full employment. I understand that's almost contradictory, but that's also why fiscal policy is important. Not just supply side.

[@JessieeAlmar]

I'm planning to retire at 59 in another country outside the US that is free, safe and very cheap with a high quality of life and good healthcare. I could fully just rely on only my SS if I wanted to when that times arrives but l'll also have at least one pension, a 403 (b) and a very prolific Investment account with my Stephanie Stiefel my FA. Retiring comfortably in the US these days is almost impossible

[@KarencitaSacher]

I know this lady you just mentioned. Stephanie Janis Stiefel is a portfolio manager and investment advisor. She gained recognition as an employee of neuberger berman; a renowned investor she is. Stephanie Janis Stiefel has demonstrated expertise in investment strategies and has been involved in managing portfolios and providing guidance to clients.

[@ohmakure4716]

I’m planning on moving to Thailand in the next 5 years if trump’s government doesn’t do anything with the high prices of groceries and taxes What about you??

[@MafArdoleda]

Been debt free for two years thanks to Stephanie Janis Stiefel. So sad to see my friends in their 40s with car loans, mortgages and credit card debt.

[@GobinderLuymes]

My sister lives in Aussie. They have good healthcare better than America. I am also moving there after I retire.

[@YaxelBurone]

Please stop gentrifying countries

[@Stev607aqr]

We're spending too much money on Musk's SpaceX and Tesla subsidies.

[@garrenosborne9623]

& spending too much attention on divine wrong of billionaires lets build through the inevitable decline on foundations that are REAL, rather than convenient assumptions of inherited B$

[@raymundogonzalez6450]

President Elon is a Scam

[@GETmoneyOUTofPOLITICSNOseL-f5z]

$OCIALI$M is ONLY 4 da RICH.... (so they believe)...

[@pauliunknown8118]

but won't someone think of the poor government contractor

[@felixnewman2473]

SpaceX saves the American tax payer 100's of billions of dollars. Not sure what your logic in stopping this is.

[@JohnDaniels]

“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." Henry Ford

[@danielpye7738]

He was probably referring to the creation of the Federal Reserve.

[@davecopp9356]

Also he told the truth on a certain group of people in his book, Ford was a genius.

[@allynnamccleod8862]

⁠@@davecopp9356 “ he told the truth on a certain group of people?” Could you be referring to the fact that he was a raging anti-Semite who paid for the printing and distribution of, “The Protocols of the Elders of Zion” in the US?

[@johnclark2212]

Ford was a Nazi before they came into power in Germany! Follow Ford at your risk!

[@freegedankenzurbaukunst5613]

How many people understand the banking and monetary system ??? That stuff should be the most transparent & easy thing to understand . Why is it so opaque ?

[@DonaldMark-ne7se]

Some economists have projected that both the U.S. and parts of Europe could slip into a recession for a portion of 2023. A global recession, defined as a contraction in annual global per capita income, is more rare because China and emerging markets often grow faster than more developed economies. Essentially the world economy is considered to be in recession if economic growth falls behind population growth.

[@kevinmarten]

My main concern now is how can we generate more revenue during quantitative times? I can't afford to see my savings crumble to dust.

[@JacquelinePerrira]

It's a delicate season now, so you can do little or nothing on your own. Hence I’ll suggest you get yourself a financial expert that can provide you with valuable financial information and assistance

[@Jamessmith-12]

Very true! I've been able to scale from $50K to $189k in this red season because my Financial Advisor figured out Defensive strategies which help portfolios be less vulnerable to market downturns

[@kevinmarten]

How can I reach this adviser of yours? because I'm seeking for a more effective investment approach on my savings?

[@Jamessmith-12]

'Carol Vivian Constable, a highly respected figure in her field. I suggest delving deeper into her credentials, as she possesses extensive experience and serves as a valuable resource for individuals seeking guidance in navigating the financial market.

[@blueberry-ri7eb]

Why wasn't he worried when Trump put 8 trillion onto the debt giving goodies to billionaires?

[@greeneyeswideopen774]

It's a simple model. Incomplete so we can see how lending and GDP can be tied together. Underlying assumption is that firms invest to increase productivity. Now of course we have a world of stock buyback and executive super compensation. Not productivity.

[@thomas-k2k8w]

UH, democrats house of reps under trump spent 6 trillion on covid. trump spent 2 rebuilding the military and undoing the damage Obama caused.

[@sarawilliam696]

So how exactly can we guard against the coming financial reset for 2025? Like what are really the best strategies to make our portfolio recession proof against the incoming financial reset? I'm very worried about my $110k stock portfolio.

[@PatrickFitzgerald-cx6io]

Knowledgeable Investors know where and how to put money during a crisis in order to reduce risk and maximize returns. See a market strategist with experience if you are unable to manage these market conditions

[@NoorJari406]

I agree, having the right plan is priceless. My portfolio is well-suited for any market and recently doubled since early last year. My CFP and I are aiming for a seven-figure goal, which might take another year to achieve.

[@brucemichelle5689.]

Being heavily liquid, I'd rather not reinvent the wheel. Since this strategy works for you, how can I contact your advisor?

[@NoorJari406]

‘’Aileen Gertrude Tippy’’ is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.

[@brucemichelle5689.]

Thank you for the information. I conducted my own research and your advisor appears to be highly skilled and knowledgeable. I've sent her an email and arranged a phone call. Her expertise is impressive, and I'm eagerly anticipating our conversation.

[@donmiles109channel]

What a stupid analogy. The dark can hide many dangers. It is not a fear of lack of photons, it is a fear of the unseen dangers. Fear protects us.

[@jansun999]

Only Elon would think of such an analogy. Totally devoid of human emotion and imagination.

[@CrniWuk]

But fear while protecting us makes a terrible advisor. Particulary If you want to understand how something works.

[@austinbar266]

America is currently plagued by the hydra-headed evil duo of inflation and recession. The worst part about this recession is that consumers are racking up credit card debt. In December alone, credit card debt went up 36% while rates have doubled in a year. Inflation is so high that consumers are literally taking debt for basic life necessities. Collapse has indeed begun..

[@rogerwheelers4322]

The truth is that people are finally waking up to the fact that our systems are breaking down in thousands of different ways all around us. Personally, the financial market seems like the only way to go with a long-term horizon . But if you don't have that time, it's a tough market out and thus you should consider financial advisory.

[@joshbarney114]

A lot of folks downplay the role of advisors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.

[@FabioOdelega876]

Can you provide instructions on how to contact your advisor? I'm experiencing erosion of my funds due to inflation and looking for a more profitable investment strategy to make better use of them.

[@joshbarney114]

‘’Marisa Michelle Litwinsky’’ is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.

[@joshbarney114]

I've experimented with a few over the past years, but I've stuck with ‘’Marisa Michelle Litwinsky” for about two years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.

[@stanleyshannon4408]

Governments print money, they don't print wealth. Wealth is measured in food, energy, and human productivity, not money.

[@bunsw2070]

Then why is inflation so high? Does Steve Keen have an answer for that?

[@MDOY79]

Money is supposed to represent the store of wealth. By printing money, they are devaluing it and thus the value of your savings

[@vikoccult7494]

Yeah but Money is the purchasing power for all the food, energy and labour in the society and whenever the government prints new money they shift the distribution of the purchasing power in that society dependent on who gets access to that new money first. During Covid the UK Government printed 700bln new pounds and they all ended up on the super rich further increasing their purchasing power and decreasing purchasing power of the middle class.

[@stanleyshannon4408]

@bunsw2070 no, he does not. My comment is in opposition. Money and wealth are two entirely different things. Money is an estimate of wealth. When money overestimates actual wealth, it takes more of it to secure actual wealth.

[@stanleyshannon4408]

@MDOY79 yes, money is merely a convenient way to represent what a bushel of grain is worth because it is easier to walk around with some coins in your pocket than a wagon load of grain (increases productivity). Money is fundamentally a mathematical concept, which is why all these models are absurd. It doesn't matter how complex you make the math, wealth doesn't care any more than the universe cares about your differential equation.

[@sikinside1838]

This model is fatally flawed and massively incorrect. It fails to account for inflation, which is a critical oversight. Without addressing inflation, the model risks leading to a scenario similar to Venezuela’s hyperinflation. Furthermore, the absence of Purchasing Power Parity (PPP) in the model undermines its ability to accurately assess the real value of the currency and its implications for international competitiveness. While it is true that a country may not technically go bankrupt, the result could be a worthless currency and a sharp decline in living standards. Ignoring these factors creates a dangerously incomplete picture of economic stability and sustainability.

[@Ziegfried82]

Yes this type of modeling is assuming the US dollar maintains world reserve currency status etc. A crazy assumption to make if the US government continues to be so irresponsible.

[@leonhardtkristensen4093]

@@Ziegfried82 Problem is that all governments are irresponsible so it flattens out in the wash. You don't pay $600 - $800 for a new car these days as they did 100 years ago. The value of the car in labour hours and material is probably not much different today. It is just that we have had a bit of inflation - every where.

[@danielpye7738]

You are correct. One thing has really struck us here in NZ is how much more in cost infrastructure has gone up. Dunedin a small “city” in NZ had a hospital priced at 3 billion NZ dollars, making it the most expensive per square metre hospital in the southern hemisphere. It has a population of 134,000 people. The real life effects of people believing the government can just print money.

[@ThomasVWorm]

​​@@leonhardtkristensen4093no growth without inflation. In capitalism the owner of the capital becomes the owner of the products being produced and not the producers, who are the workers. This means, the gains of productivity increase go 100% to the capital owners. This causes an economic crisis, because the owners don't want this stuff, but they want to sell it. The consumers, which are the workers will be unable to buy it unless the producers lower the prices. But this is not the goal, why they invest into an increase of the productivity. They do it to remove human labour out production to make more money. So the worker can participate from productivity increases in two ways: 1. trying to negatiate thousands of prices down when spending his wage 2. negotiating a single price up - his wage. This way he also participates, when it is not his business, where the productivity was increased. This way also the life of a nurse improves. 2. is easier and also benefits those, who cannot increase productivity because their core product is the time they spend for others and not a product, they produce. Without inflation the economy collapses in a deflationary process since the dreams of profits cannot become true without.

[@lesmotley6839]

Thanks for your comment. I couldn't understand why Keen's model would work but your explanation makes sense. Complete write off of all debt and the loss to all the holders of the debt is how the whole system resets. Germany in the late 1920s and early 1930s is the model that gives the most likely outcome to America's binge on borrowing in my opinion.

[@NeilRieck]

I have always believed that "the economy" was a large machine and that "money" was the lubricant that allowed the machine to run friction-free rather than seize up. At various times in all economies over the past 150 years, things seemed to run better when there was more lubricant spread around. Likewise, when taxation policies allowed too much lubricant to remain in the hands of too few (the 10%, the 1% and the 0.1%), the machine slowed down. The American machine sped up after FDR changed the taxation policies on the rich from flat to progressive. When tens of thousands or homeless people are camped out in the streets of large American cities, at the same time that billionaires can run private rocket companies, I think this is a sign that our capitalistic system is in need of some socialism.

[@EEE7491]

the rich people get richer by taking care of their pockets that IS the TRUTH CORRUPTION DOES NOT HELP THE POOR

[@rejinc]

and we are seeing absolute peak of corruption ,, right now and this upcoming Potus term,,they will steel billions

[@EnocksonFerrall]

I don't know who needs to hear this, you've got to stop saving money. Invest some part of it, if you really want financial freedom.

[@AlexaJazmin-t5o]

Invest in bitcoin, gold, silver, buy stock, forex market, commodities. Just invest and save yourself.

[@Thandisebe9054]

Good talk, I tell my friends everyday. It's good to save money but gotta have that investing spirit if you really want financial freedom

[@NatalieScott6124]

What if you don't know how to trade any of these? I mean, I see your point. Some people have the money and are willing to invest. But the problem is where to.

[@chingron]

Invest some of it? Ha. The way the system is designed, the prudent thing to do is wrecklessly gamble everything you have. Savers are suckers and the system punishes them for being responsible. It’s a terrible system… but that’s the way it is.

[@JohnScaife4965]

Hey dude, this is 2025. People who aren't even traders make money from the crypto and forex markets and moreover there are already financial analysts and trading experts(PhDs) who have shelled out theories and ideas for years on how bit coin technically grows

[@asbeautifulasasunset]

Well, Elon, maybe the rich should pay more taxes instead of getting tax cuts. Oh, and draining wages from workers for two generations, maybe those should be paid back to people retroactively.

[@markjuhasz2803]

Or you can work in a Chinese factory, as there is no american EV factory at all. Wait, there are three! Thanks to Elon. If Elon have to pay taxes on the share price increase, then he has to sell a lot of his shares to pay his taxes. Then his management control ceases in Tesla. GM buys Tesla shares, and Tesla will be as succesfool as GM. Which is close to bankrupt by now.

[@srushtimitra]

Why should rich pay tax since the US government can just print money

[@gobot4455]

You know and I know there are too many temporarily embarrassed millionaires who would fight tooth and nail against increasing taxation on the wealthy.

[@SirAlford]

@@gobot4455 Why is it a good idea to increase tax on those successful? How about return to sound money and do away with socialism.

[@seth2390]

@@gobot4455 I am highly against taxation yes. And I am wealthy, yes. Isn’t it rational

[@jeromesand]

Well, to be honest, politicians decrease debt through inflation. Then we end up with currencies with a whole lot of zeros on it. Back just 30 years ago $1 million was something now everyone that owns a house in Canada is a millionaire.

[@winifred-k9e]

These uncertainties will always be there. Thing is, every once in a while, the market does something so stupid it takes your breath away. If you’re not ready for it, you shouldn’t be in the market business. or get you a skilled practitioner.

[@richardhudson1243]

I completely agree, which is why I trust an investment coach to make decisions. They have the right expertise and training, and their skills focus on managing risk to maximize returns and protect against losses. Because of this, it's nearly impossible for them to underperform. I've earned over $1.5 million working with my investment coach for more than two years.

[@JacobsErick-u8r]

we’re only just an information away from amassing wealth, I know a lot of folks that made fortunes from the Dotcom crash as well as the 08’ crash and I’ve been looking into similar opportunities in this present market, could this consultant that guides you help?

[@JacobsErick-u8r]

This is exactly how i wish to get my finances coordinated ahead of retirement. Can you recommend the financial advisor you used to get ahead?

[@richardhudson1243]

"Melissa Terri Swayne" maintains an online presence. Just make a simple search for her name online.

[@wwtdwhatwouldTONYdo]

Weren’t you calling for a debt jubilee just a few years ago? And even if you’re right and everyone else is wrong, the economy is a confidence game. No one has any confidence left.

[@webfreakz]

yes private debt jubilee. and the confidence is created when the government is running a deficit for useful projects in society.

[@kierenmacmillan]

“The economy is a confidence game [and] no one has any confidence left” is legitimately the best statement (“hot take”) I’ve heard in a long, long time.

[@KAZVorpal]

This is pure Keynesian incompetence. The creation of money does not stimulate actual wealth creation, in fact it depresses it. Inflation is destructive. It does hide the debt crisis, but it also makes the debt crisis worse. Government spending does not stimulate the economy, in fact it depresses the economy. Keynesianism is sociopathy that ignores real human beings and the effects of healthy economic activity on their quality of life. Also, GDP is calculated in a deceptive way. You certainly can use corrupt mathematical tricks to make the official GDP number rise, but meanwhile the economy is falling apart.

[@SomeCajunDude]

lol keynesianism built america in the 20th century dont be dramatic

[@williambranch4283]

@@SomeCajunDude WWII built America. Not FDR.

[@SomeCajunDude]

​@@williambranch4283 I never mentioned FDR. I am referring the post war period. Of course, no one thing built the country, it was a combination of factors. This is very complex, hence why I reject the knee-jerk dismissal of Keynesianism because it shows a shallow understanding of the situation.

[@MaggieJohnson-vn6su]

We were MUCH better off during the pre-Reagan Keynesian era.

[@MaggieJohnson-vn6su]

​@@SomeCajunDudedogma, not truth.

[@wellsHannahh]

The continuously changing economic conditions in our society have made it necessary for people to find additional sources of income, thus I am looking at the stock market to fuel my retirement goal of $3m, my only concern is the recent market crash.

[@dannielleemarie]

for majority, the solution to their problem can be found in specialized knowledge, so can as well seek guidance from a well experienced advisor

[@Harperrr.99]

Agreed, despite my rookie knowledge of investing, I have a financial advisor who did the trick in a bit more than 6 months after a lump sum capital of $500k, and I've so far made a fortune. I'm now buying real estates, gold and silver as advised by my FA.

[@c.o.l.ek500]

I've been considering getting one, but haven't been proactive about it. Can you recommend your advisor? I could really use some assistance.

[@Harperrr.99]

I've experimented with a few over the past years, but I've stuck with the popularly ‘’Sonia Nunes Demelo” for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.

[@Griffinguardian]

Thank you for putting this out, it has rekindled the fire to my goal... was able to spot Sonia after inputting her full name on the web, she seems highly professional with over a decades of experience.

[@kdietz65]

Isn't a simpler way of saying all this sans the mathematical analysis, is to just say with the Federal Reserve system and quantitative easing, that there's no real upper limit as to how much money the government can create, thus it can never run out of money the same way a person can. We might have unwanted inflation, but not US government bankruptcy.

[@ProfSteveKeen]

Yes that's true, but saying it won't change anyone's mind. You need an incontrovertible proof, which this video provides: IF banks are just intermediaries between savers and borrowers, THEN the government can't create money, and it can go bankrupt. But IF banks lend money, THEN the government can never run out of money,AND the government creates money when it spends more than it gets back in taxation. Economics textbooks teach the former position; the real world is the latter. The gap in the two situations is as big as th gap between Ptolemy's Earth-centric model of the Universe, and Copernicus's Sun-centric model of our solar system. We stopped listening to Ptolemaic astronomiers five centuries ago, but only after Newton proved how the Sun-centric system worked. This is what we need in economics.

[@dondonnysson4973]

All you said in this video is essentially that in practice the fed prints money which grows the economy and inflates away debts. What you model does not seemingly model is the inflation that results from this debasement. As long as productivity increases faster than the monetary base this works, but if that ever stops for even a short period of time the whole house of cards collapses and we either hyperinflate away and reset or go into a decades long depression whose length is influenced by how leveraged the system is.

[@mmmhorsesteaks]

60 day payment terms create fiat money... Don't even need a bank for that.

[@darkbilby74]

“Top economist”? Self-praise is no recommendation

[@wanderingtravellerAB99]

He's right tho.

[@piccalillipit9211]

70% of the US economy is based on people self promoting

[@leightonwatkins9486]

when its true its not arrogance though is it....best and brightest should be at the top not people just becasue they can get credit ....just natures way

[@leightonwatkins9486]

@Positron_6.022 dont even bother replying the internet is full of isreali assets ( unit 8200 ) and retarded mongs...if truth about economics catches on thats isreal piggy bank gone

[@maritaschweizer1117]

This guy is crazy. According him the many government bancrupcies all over the world never happend.

[@cherubin7th]

We make so many abstractions that we start to confuse ourselves . We always must be careful to not fall into a fancy version of the broken window fallacy. Even if the government cannot go "bankrupt", irresponsible spending just means that citizens lose wealth to finance this spending. So the only ethical spending is, what is really necessary or really really useful for the people. I agree that some things like infrastructure and not letting people starve to death is good, but most spending is just for selfish political gains or corruption or because of nonsense rules like you get your budget cut next year if you don't waste it all now. So a mechanism to put the burden of prove to the spending proposal is a good idea.

[@ProfSteveKeen]

Yes I agree there. There is an enormous amount of waste in government spending-such as defence spending, bureaucratic overload, etc. But you have to distinguish that from the issue of creating fiat currency, which is what the excess of government spending over taxation achieves.

[@ronagoodwell2709]

Cut military spending by 30% and next year an additional 30%. In the meantime raise the marginal tax rate up to 50% and next year 60% on any income over 400 million. Keep the rest of the taxes low. Stop giving money away to billionaire CEOs.

[@piotrd.4850]

US DoD spending is already near historical low. If US fixed healthcare alone, it would boost productivity and left 6% of GDP (at least) for deficict, infrastructure and what else.

[@du5tman]

Do not cut spending on DoD. Instead, audit the sh1t out of them. We cannot afford a subpar military.

[@ronagoodwell2709]

@@du5tman Go ahead and try to audit them. Then when you realize you can't do it. Go agead and cut spending. Reconsider a more effective and leaner military with cheap but cutting edge drones and bots. Dump the useless carriers and jets and tanks. Submarines are still viable and can be used to reach out. But consider long range missiles that can deliver hundreds or thousands of drones to a target.The world has already changed. We're still preparing to fight tomorrow's wars with yesterday's weapons.

[@davidlindburg1921]

Cutting military spending during these times would be inviting conflict besides we'll be at war inside three years, no problem

[@greeneyeswideopen774]

You missed the point.

[@jemborg]

Very interesting. Subbed! 👍

[@OBGynKenobi]

Why is musk suddenly a scholar of international relations, economics, politics and geopolitics? Giving him any time on this is akin to giving a plumber listening time to his theories about brain surgery.

[@jayha7071]

I thought him and ramaslimy were about government efficiency, why are they getting involved in these other areas

[@personzorz]

Because he's a billionaire oligarch who has bought power in the collapsing United States.

[@Alexanderthenotsobad]

Because Musk likes the smell of his own farts. He really drank his own Kool-Aid and believes that he is a "know it all".

[@ginn1902]

Because you guys got a con man as President, and he's bringing his band of con friends into the gov with him.

[@SolarPlayer]

Dude this is bad optics, I think we're supposed to pretend we listened to Dr. ProfSteveKeen (Phd.)'s arguments first before we agree with everything he says. Make it look like we considered the ideas of non-Phd plebeians like Elon Musk and even plumbers (ROFL imagine actually listening to a plumber!) seriously, but that we disagree because the quality of their arguments were lacking

[@justinmccarthy2195]

Economics is not accounting. And, usually winds up somewhere near the Social Sciences School. Somewhere I missed in the model inflationary impacts; reduced GDP growth as debt climbs; diminishing returns on deficit spending as debt climbs; greater inequality between real asset holders, wage earners, financial asset holders etc; social unrest; increased poverty; rising interest rates; and, numerous adverse impacts as the nation becomes a global credit risk. Models are great; and, then there is reality. Musk was closer to the truth.

[@ProfSteveKeen]

Yes, you missed all of that--which is caused by private debt, not public. I'll show this in the next video.

[@peterburke5894]

As evidenced by the Thai cave rescue case Mr Musk doesn’t take kindly to criticism of his self serving world view as delusional as that is

[@Dbb277-2]

He was being laughed at by everyone in the diving industry. Such a self serving putz.

[@haddenindustries2922]

@@Dbb277-2 AND he actually hired a guy to find dirt on Vernon Unsworth so he could "justify" his pedo claim. He is indeed a self serving putz.

[@thomas-k2k8w]

@@Dbb277-2 I seriously doubt the richest man on earth could care aless what an idiot like you thinks about him.

[@ReubenAStern]

This reminds me of Garys Economics. He vaguely explained this system when talking about government debt.

[@organizer14]

We are economists and accountants and we disagree with this economist.

[@petejunebug]

You are neither sir. You work at McDonalds

[@noonespecial1178]

No you are not you are a child man living in your mothers basement .🤣

[@MrMimios]

You may be an accountant but if you believe in Loanable Funds theory, then you haven’t got an idea of the operation of modern banking and thus you’re not an economist.

[@SpiderPriestess]

The problem is gdp may go up but gdp per capita is actually going down as wealth inequality grows … Elon isn’t nearly as smart as people give him credit for being … though he’s really good at convincing people he is . I think that’s called a con artist. Maybe we should draw a diagram of that

[@vaqueroontario]

OK Elon - so let's stop military spending - great idea! Your income will take a hit but.....

[@piotrd.4850]

US Defence budget is at historical low ( 3.5% GDP )

[@vaqueroontario]

​@@piotrd.4850 a quick search of Google "The U.S. spends more on the military than any other country, making up almost 40% of the total military spending worldwide. In 2023, the U.S. spent $905.5 billion on defense, which was more than twice what the rest of NATO spent." and "The U.S. has spent at least $8 trillion on the wars in Afghanistan, Pakistan, Iraq, and elsewhere since 9/11. This includes: Direct Congressional war appropriations Increases to the Pentagon base budget Veterans care and disability Interest payments on borrowing Foreign assistance spending"......

[@AdrianAzian]

I think Elon is talking about dollar amount and not % of gdp.

[@vaqueroontario]

@@piotrd.4850 weird - my response to that comment seems to have disappeared - nonetheless you are completely wrong - US military and war spending (to deal with your semantics) is astronomical.

[@chingron]

And let me guess… you also accuse him of being a billionaire who only cares about profits.

[@Fandres55]

Make rich people and companies pay more taxes, how about 50% on earning.

[@GlennBru-gt6ck]

Why is an economist that correctly describes the real world called a contrarian????

[@mtn1793]

He’s a contrarian as opposed to those who run on pure greed. Last thing they want is rules and responsibilities. Fraud is their candy.

[@ProfSteveKeen]

Because mainstream economics is a set of interlocking myths. There are a number of realist-oriented alternate approaches to economics, and my work is a blend of them all. The mainstream--known as Neoclassical economics--would have collapsed a century ago if it were subject to the same processes that happen in a genuine science.

[@MetaView7]

If he were so smart, he would be the Fed Chairman long ago.

[@GlennBru-gt6ck]

@@ProfSteveKeen thanks for checking in, Professor, I am an admirer of your work. I think all these so-called economics experts should be required to disclose the school of thought they represent before their opinions are shared. Just like political talk shows that clearly show the political affiliation of the speaker, economists should be required to do the same. “We’ve heard from the neoclassical, now for the post Keynesian point of view”

[@jt80995]

Hi ​@@ProfSteveKeen, nice work on the video! I'm for sure interested in learning more. My opinion is that you left out the elephant in the room, which is inflation. Can you explain your model including the push and pull inflation that we experienced after Covid? Most economists plus myself believe excessive borrowing by the government was partially/maybe even largely to blame. If it is not so, please explain.

[@townstown]

Desperately needs a good abstract at the beginning and a summary. It's a lot to wade through at high speed monotone without some framework of what you're trying to say.

[@erikeparsels]

When government spends more than it taxes back out, it adds money to the economy. That money either circulates and thus facilitates economic activity or is saved until it is taxed back out again. When the government spends less into the economy than it taxes out, it sucks money out of the economy. When that happens, the relative proportion of bank credit money, i.e. private debt, in the economy grows, making the financial system more and more prone to a wave of defaults and a 1929 or 2008 type of crash. If you want to re-shore manufacturing jobs, you need to increase, not decrease, government spending to increase capacity, to build the infrastructure that will lower firms' costs and make them more competitive, to train the engineers, designers, accountants, technicians, physicists, programmers, doctors, nurses, biotech researchers, et. who will be needed. Cutting government spending just blows a gigantic hole in the economy and shrinks it. If you're concerned about the interest on the debt, there's an easy fix. pursue a permanent zero interest rate, or only pay interest on treasury bonds held by pension funds. As treasury bonds mature, just pay them off and don't roll them over. We don't need to sell treasury bonds after all. The government can spend without issuing treasury bonds to sideline that liquidity. If we want to provide a safe asset, we can, either without interest or provide it only to those like pensioners who can't carry risk the way wealthy investors can. Or just don't sell treasury bonds and let the treasury run an overdraft at the fed. Every time the US tried to pay down its national debt, it badly crashed the economy. By spending more into the economy than it taxes back out, the government creates net financial assets. The government's red ink is the private sector's black ink, and vice versa. Don't try to balance the budget. The US has run a perpetual deficit for all except a handful of years since the founding of the republic without any hyperinflation or serious problem. We need the government to target its spending better, toward infrastructure and job creation rather than pointless militarism and Wall Street bailouts, not cut its spending. back.

[@davidhobbs5679]

Casually ignoring that the money spent into the economy simply gets converted into increased prices due to higher demand, also ignoring the fact that the excess spending doesn't actually translate into any real asset. The problem with your (MMT) theory is assuming that money = asset, financial assets are not the same as goods and services, because they can't exist without real goods and services to convert those assets into.

[@jamescooley6771]

@@davidhobbs5679 That is why government spending needs to be targeted as much as possible toward unused and under utilized assets that can create new real assets.

[@MrBlack-wt5er]

I think that might have been right long before c-19 but now that we're 37 trillion dollars in debt I don't think there's a solution and not balancing the budget doesn't sound right to me and we have never been in the trouble we're in now.

[@filmesharrifena865]

​@@MrBlack-wt5erthe solution is to widen

[@yj7564]

Unlimited money creation is possible, but it will promote inflation. There are already signs of prolonged inflation, and in order to stop inflation, monetary tightening, not money creation, is necessary.

[@hamiltonmackenzie3340]

When you look at the graph for US debt, it is beginning to represent an exponential increase, pretty terrifying.

[@KCBluesJams]

All currency is all make believe just like crypto currencies . Wait until the crypto bubble pops and all this digital stuff people think is of value goes 💥

[@barbt.9211]

It's beginning, WTF?

[@AdrianAzian]

Couple that with the fact that AI and robotics will soon take more than 50% jobs. Where will the govt get taxes from incomes to pay for the exponentially increasing interest rate?

[@barbt.9211]

@AdrianAzian Absolutely, was just looking at 3d printing unbelievable, I was a mechanical engineer with BAE SYSTEMS in the 1990s, with a AI & 3d printing, I'm out of a job, good thing I retired in 2010. I heard that They are paying twenty dollars a hour for CNC OPERATORS, When I retired I was making 100 thousand per year, My house in Westchester county, New York was $280k, just look at it, they want 1.7 million for it. WOW

[@thomas-k2k8w]

up 10 trillion under Obama, up 10 trillion under Biden and under trump democrat house of reps spent 6 trillion on covid. right there, 26 trillion of our 36 trillion debts.

[@charleswillcock3235]

This is one of the most important videos on KZbin. This is the best explanation of how the economy actually works (obviously a bit simplified). Thank you for sharing.

[@TheInternetIsDeadToMe]

“I’ve tweaked my little spreadsheet, now everything is okay” “Keep increasing debt and creating money boys, this house of cards is never going to collapse”.

[@FlipjevanTiel]

So I hope you didn't vote for Trump, who raised the debt two times more than Biden, and is planning to raise the debt even more, by giving the wealthy more tax-cuts.

[@Alex_Plante]

Is GDP in the model real or nominal? I suspect it's nominal. What is missing in the model is inflation, which occurs when the real economy reaches constraints on capacity. Reaching capacity can stimulate real investment, to increase capacity, or simply be inflationary, or be a bit of both. I agree that a growing government debt will not cause the government to go bankrupt, and will cause nominal GDP to increase, but what is needed to complete your model is a model of how nominal GDP growth is divided into real growth versus inflation, as a function of real capital, human, resource and energy constraints.

[@224dot0dot0dot10]

I also found it to be unusual that there is no German Weimar Republic style inflation in this economic model ?

[@geo1134]

Completely agree he is not factoring short-term effects of inflation. Also not factoring in the difference in efficiencies between government and private expenditures and its effect on GDP

[@ThomasVWorm]

​@@224dot0dot0dot10Weimar Republic style inflation does not pop up out of nothing. You have to try hard to get it. The USA will never see it, because the entire world loves to have dollars.

[@JohnDaniels]

I was thinking the same thing, where's the inflation column 🤔

[@aocdk840]

Excactly, was thinking the same thing,

[@MrJustonce123]

Mr. Keen, if you are seeing this please explain the following cases of extreme inflation. The governments created large sums of money, and then the nations went completely broke. 1. Germany (1921-1923) 2. Zimbabwe (2007-2008) 3. Venezuela (2010s-Present) 4. Hungary (1945-1946) 5. Yugoslavia (1992-1994) 6. Argentina (1975-1991) 7. Greece (1941-1944) 8. Peru (1980s)

[@Ziegfried82]

Yep history shows otherwise to his voodoo economic theory.

[@discreplayboss]

He can't. He's a neo-Keynesian, he's a fool.

[@evilryutaropro]

Hyperinflation has to deal with paying your creditors in currencies that aren’t your own which leads to the domestic currency being devalued on the exchanges. The US being the reserve currency and owing money in it’s own currency can basically issue out dollars with limited inflationary effects relative to the rest of the world experiencing more inflation.

[@piccalillipit9211]

They all borrow money in external currencies - which is real and then printed paper money [which is fiction] to supply internal demand. The US [much as I dislike the US] borrows money in $USD and prints $USD and destroys $USD at will. This is why even as a massive supporter of the EU - I as a Brit would NOT region if we had to lose the £GBP. Not cos I like the Kings head on the money - but for this EXACT reason

[@piccalillipit9211]

@@discreplayboss Well I just did and so did the other chap - its not hard

[@KAZVorpal]

Why are all of these channels using these garbage speech to text things for their subtitles, that constantly spell words wrong? What is the point of putting the subtitles up there, if they're going to be wrong? It makes the whole Channel look amateur and untrustworthy.

[@Sepp_Tember]

He is right in saying that the US can never go bankrupt. It can always pay the interest no matter how large the total debt is, by just creating new fiat. The underlying problem is inflation. If money creation exceeds the growth of the real economy then prices will rise.

[@aaronogden9900]

I love how he’s called ‘ contrarian’ for explaining how money actually works as opposed to mainstream economists who just spout neoliberal rubbish.

[@DANCEGARAGEPUNK]

Mainstream economists are nep republican ! LOL : )

[@0zoneTherapyCures]

Just like nutritious food is labelled "organic", when it' just food as Nature designed.

[@gj8550]

I am a retired banker with degrees in computer science and math. Respectfully, I’d like to point out 3 factors that cast doubt in the Professor’s model. 9:38 He said that interest on bonds increases government asset. That’s not entirely true as some bonds are purchased by foreign entities. Secondly and more importantly, he is basing his model on fiat money, the trust of which is increasingly being challenged by many countries worldwide. Furthermore, debt to gdp ratio has been increasing. So at some point, the government would be unable to service the debt. This final point is in fact the thrust of Elon’s (and my) fear.

[@truthseeker5911]

To buy bonds in the primary market a purchaser must be in possession of government issued currency in an account at the central bank. As US Currency is used to settle international transactions of course it will be held by foreign institutions and who may also purchase it in the secondary market.

[@gj8550]

@ What’s this have to do with price of oranges?

[@warrenb2856]

He is a fiat-trained economist not a so called Top Economist! Good luck with that.

[@light8258]

@@gj8550 The debt-to-GDP ratio has no direct impact on the government’s ability to service its debt because the government can create as much money as it needs. GDP does not, in any way, limit money creation. The primary concern is often that the debt ceiling could constrain the government, or that higher interest payments might eat up the budget. But that's unjustified. The short-term interest rate on bonds is closely tied to the federal funds rate. If the central bank reduces the federal funds rate, it can effectively counter a part of the issue of high interest payments. A common argument is that investors might lose confidence in U.S. bonds, leading to a sell-off and higher interest rates. However, the central bank could counter this by purchasing bonds through quantitative easing (the Federal Reserve currently holds around 20% of government debt). This intervention would once again lower interest rates, preventing them from spiraling out of control. A further worry is that such actions could lead to inflation due to the money creation required for bond purchases. First of all, bonds have to be purchased with central bank money, which doesn't play any role in the private sector and only increases reserves, so it doesn't need to cause inflation if the reserves remain idle. Also, inflation does correlate with money supply over long periods, but it is manageable in this context. Over time, wages can be increased to offset inflation, or certain taxes could be raised slightly to reduce the money supply in sectors, where it led to inflationary pressures. A scenario where the US government is unable to service its debt would most likely include hyperinflation, which is not a phenomenon historically caused by money creation, but is almost always caused by external shocks and then exacerbated by reactionary money creation.

[@gj8550]

@ The debt to GDP ratio has EVERYTHING to do with the government’s ability to service debt. To a large extent, US relies on foreign sources to buy its bonds. High debt to GDP signals to the world that the government may be struggling with sustaining the economic capacity to service its loans; thus discontinue bond purchases. Some may argue that the erosion of that confidence has already started as evident in the declining interest in recent bond auctions.

[@bosoerjadi2838]

Just the referral to Mankiw's textbook (at 1:52) already made this video immeasurably worth watching it for anyone interested but unschooled in macro economics. Thank you for that. It's freely available for download on internet, by the way, and it's a very accessible read.

[@tylermac70]

It is common sense that one should avoid spending more than they make. I dont care how many "Scientific" charts say otherwise

[@James-tv4pl]

National finances are very different from personal finances

[@serptimis1552]

except the gov can't "make" money. Should the US get a job?

[@pauliunknown8118]

mommy has to make sure she doesn't spend more than daddy makes, otherwise the electricity company turns the lights off :((((

[@ScottAllenFinance]

Well then you will never under economics and finance...

[@rap3208]

@James-tv4pl nah, they just brainwashed you to think so. Congratulations.

[@OsamuMiyachi]

1. The prof. does not take account that large portion of debt is purchased by foreigners including Chinese government. 2. When debt level increases, interest rate of debt will also increase. That is why long term interest is increasing even the treasury reduce the prime rate.

[@chrisfreebairn870]

Watch it again .. interest rate increase with debt level is a distinct feature he mentions .. why did you miss that?

[@InventiveHarvest]

The problem here is that the observations contradict your model. We don't see stabilization, we see that interest is rising as a percent of gdp. I take a guess that this is because the model does not take into account that if money is created when debt is issued, then also money is destroyed when the debt is repaid. So, more and more debt would need to be issued. What Elon's concern is that there will be big problems when interest payments take over the federal budget.

[@Gumardee_coins_and_banknotes]

Did you take into account inflation?

[@InventiveHarvest]

@Gumardee_coins_and_banknotes increasing money supply IS inflation

[@WarrenPeacenik]

Pretty sure the model takes into account money is destroyed when the debt is repaid. Even I, a mere lay student know this. Money is also destroyed in taxes. I can't imagine what Elon is thinking, other than taxes pay for govt spending, and/or govt is funded by money borrowed from Goldman-Sachs - which would be insane. But to establish a few facts: the so called, 'national debt' is effectively the money supply. And "the interest" is paid to entities holding bonds and treasuries, which is an additional, voluntary govt transfer into the private sector. I have no idea how this is relevant to the federal budget. It is more relevant to the functioning of the economy - as I noted, taxes don't pay for govt spending and govt spending is not borrowed from private banks, never mind "the interest." ( Ouch! My brain hurts. I can understand the basics of the monetary system but i'm unable to explain how others misunderstand it.🤪There's a thumbnail next to this comment for a video with a headline: "Elon Musk's Plan to Repay the National Debt."😹A clear indication of madness. No national debt - no money - no USA. Like my investment adviser says, 'I have a dark side. I want to watch them do it!'🤭🍿)

[@chrisfreebairn870]

​@@WarrenPeacenik Don't you think Musk is just using stereotypical simplistic misconceptions about money as a political tool to distract the base from what they are really up to - transferring big chunks of an increased money supply into the pockets of the uber rich? Trump, after all, tried to get the Rs to sign on to totally reviving the debt ceiling, which he now says is irrelevant, after repeatedly using it to cudgel the Ds with shut down threats. Is it possible Musk does not know MMT, since he very effectively uses other ppls money to fund his enterprises? TRUMP too knows the power of debt & leverage; he knows it is a key tool, has said so many times, so its a political game of bait & switch, to keep Maga happy while he delivers to his billionaire mates. T knows his promises can't be kept without hurting his base, so he has to toss them red meat culture war issues to deflect their rage. Its fairly typical R strategy isn't it?

[@truthseeker5911]

Musk would like the governments debt to be reduced as long as it doesn't involve him paying more tax.

[@David-135]

As many of the comments point out, absolutely no mention of the fact the dollar’s purchasing power is constantly eroded by the ever increasing money supply. The government may not go bankrupt but 60% population might.

[@stevenlarson3316]

Keen effectively pinpoints that banks create new money via lending and that governments with monetary sovereignty do not face the same default risk as households. Many economists and central bankers affirm this view in principle (endorsing the “endogenous money” insight). But the presentation somewhat glosses over important caveats: inflation constraints, political constraints, and external constraints (foreign exchange markets, international trade). If these factors materialize, they can still cause severe economic stress-even if insolvency per se is unlikely in a purely endogenous, fiat-based system. Keen’s demonstration is a helpful corrective to simpler “loanable funds” storylines. However, real-world policy advice must also incorporate broader macroeconomic considerations, including how deficits contribute to inflation, how interest rates are really set, and how foreign investors or trading partners might respond.

[@ThisDique]

Taxation is the only true constraint on inflation. That is the problem. Everything else is creative accounting that borderlines fraud.

[@OnlineSafety-ng7et]

My thoughts exactly as well as the vagaries of fractional reserve banking in a world of central banks accepting 'junk bond' repos.

[@wvhaugen]

He probably covers those concerns in other videos. In these short videos, it is good to limit the number of subjects and hammer it home. There is another benefit. I am willing to watch Keen for 15 minutes or less, but NOT an hour or two. Neither he nor his subject are that engaging. I know most of it anyway.

[@stevenlarson3316]

@@wvhaugen Probably, but Keen is insulting his audience's intelligence by not going more in depth. And there's the chance that some will come away from this thinking there's no risk involved with running large deficits. Keen says the video is meant for Musk, but I believe Musk is only interested in communicating in memes to his impressionable audience and furthering his goal of gutting all government regulatory agencies. What Keen is saying involves nuance and would not translate to a Twitter meme.

[@mikekelly5869]

​@@stevenlarson3316very well said. Short videos don't lend themselves to indepth discussion, but are perfect for glib memes. The attention span of Elon's fans is also an issue. There are several comments on here of the type that says that education isn't necessary to understand economics, it's just common sense. They're wrong, but there is a lot of them.

[@StevenSimone-ln1kb]

Very interesting video. I learned a bit as I have little monetary understanding. Buy I do have a question. Elon is big on crypto and investors buy crypto believing in the whole digital currency BS. Crypto is not currency, does not function as currency and, Warren Buffett said, if no one is buying your digital currency then it does absolutely nothing. Crypto is more like digital gold and investors buy gold when inflation devalues currency. If you apply Elon's desire to reduce spending, maybe even creating a surplus, and pay down large portions of the government debt what effect does that have on the dollar and by extension what does that do to the value of gold and crypto? I suspect Elon has other ideas as to what he wants to happen and is propagating a false message for some other means.

[@ProfSteveKeen]

Very good question! Ironically, it could mean a plunge in the value of crypto currencies. My brilliant protege Ty Keynes has built a predictive model of the US economy using Ravel in conjunction with Python and an AI, and he has found that the Equity of the Private Sector is a strong predictor of the direction of change of speculative assets like Bitcoin. You can see his work at www.youtube.com/@RelearningEcon/videos, and he is now working with Applied MMT to produce a macro forecasting guide to investing. See their work art appliedmmt.com/

[@ghazanferfazli7335]

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[@laurawilliams713]

I'm 37 and have been looking for ways to be successful, please how??

[@ghazanferfazli7335]

Sure, the investment-advisor that guides me is..

[@ghazanferfazli7335]

Elizabeth stark

[@ZerriJoseph]

Same, I met Elizabeth stark last year for the first time at a conference in Wilshire, after then my Life has changed for good.God bless Elizabeth stark

[@UkpeneEmma]

Her services is the best, I got a brand new Lambo last week and paid off my mortgage loan thanks to her wonderful services!

[@pohkeee]

Three points come to my mind: 1) double entry, because economy, as with every feedback system must double back on itself to function sustainably 2) a capital monetary system must expand as assets and GDP grows, this request trust in the accounting institutions 3) healthy and sustainable Capitalism must be founded on a wellbeing and prosperity mindset, NOT scarcity, otherwise the components don’t equally thrive and feedback into the system of sustainability. Finally: Once any of these factors diverges to a critical level, it will eat itself or deteriorate to unsustainable levels of trickling feedback.

[@davejoe75]

Hey Steve... where's the calculation on wealth and purchasing power? I didn't hear one nugget on money inflation destroying my ability to survive.🤷🏻‍♂️

[@andrelevert4484]

That would be personal finance, they will teach you to limit your liabilities and purchase assets. During inflation, the asset will go up faster and help survive.

[@Hirnlego999]

USA got it under control faster than most. It won't cut prices though.

[@donmiles109channel]

Banks lend to households, it's called credit through credit cards.

[@donmiles109channel]

Mortgages are also banks lending to households.

[@justgivemethetruth]

Elon does not know anything.

[@mikekelly5869]

He's a top class salesman.

[@rejinc]

@@mikekelly5869 NOT, he is lucky just like his hero the orange menace

[@Global_Intelligentsia]

“With the market these days if you own anything but land you own a popcorn farm.” - Al Czervik, Caddyshack

[@TexasRiverRat31254]

Thank you Prof! I sometimes suspect that Elon and others are really just skilled at finding extremely gifted people and then "managing" them to make their billions. To his credit he has done an amazing job of that!

[@mc-lb9dk]

what else?

[@richardgroth3877]

Actually they are probably familiar with these facts but the purposeful ruination of the dollar has been openly expressed for decades we are going to have a one world government with a one world digitized community ultimately obviously we will be personally implanted with a biomarke As a i takes over it will be simply impossible to individualize without a numerical sequencer😮

[@yuvarajpatel]

But sir, if US don't have any goods and services to sell what will other countries but from US, how long will just buying bonds work?

[@l000tube]

Well presented. Perhaps more emphasis on the creation of money, as simple as it is, people just dont understand that money is created by banks and issued into society as loans. It is by no means a perfect system, and some people are well positioned to make the most from it, but it kind of works. When the penny drops, you stop worrying about the national debt. But im not sure that even if Musk did understand this whether it would stop him from playing politics with the more folk understanding of the money supply - that is, using the situation to create and stoke fear. It would be nice to turn the money system into a positive one, where money is issued into society without interest attached (like Lincolns Green Back), but hey, one step at a time.

[@truthseeker5911]

Governments issue new money through their spending at no interest to those who hold it and they actually pays interest on this currency and which is held as bonds and bank reserves. The banks correspondingly then pay the interest on the bank deposits created by this government spending and which we hold in our bank accounts.

[@lawrencesmith9059]

The core problem of economists is that they pretty much ALL have never held a real job or created a real product or service. It is self-evident that borrowing a vast amount of money so your citizens can over-consume and sending that money to other countries for their productivity is NOT a good idea and is not sustainable. If your model is so good, can you predict the real world with it? Why are you not rich?

[@Voidroamer]

"you can avoid interest collapse by devaluing the currency!" Nice.. Except didn't we know that already?

[@gus24seven]

Three things. One, for Mr. Musk to say things like "we own this debt" and "our kids and grandkids own that debt"....Mr. Musk has the privilege of walking away from his fair share of ownership of that debt and reverse-immigrate back to South Africa so he doesn't ever have to deal with it. Two. If Mr. Musk is so concerned about the USA government's debt spending practice, then maybe Mr. Musk should quit cashing all those government money corporate welfare payouts to all his companies. Three, or Mr. Musk and his companies can each start paying their real share of income taxes. 🎉🎉🎉🎉🎉

[@livinglarge-2]

So rather than Musk bashing............................Do you have anything that even sounds like a solution???

[@chingron]

Conservatives warned for decades that our grandchildren will pay the bills. Well… we are seeing that is true in real time. Prior to 1970, Average Joe could afford a home and 5 children on a single salary. Today, Average Joe can’t even afford a basic apartment. Why? Money printing. Which is theft through inflation…

[@seanbond8075]

Well done sir and Thank you very much for putting this video together... Your Accounting knowledge is truly unbelievable! Cheers!

[@se7ensnakes]

Man I Worship this guy He is the only person i support monetarily.

[@fiatnomo2874]

😂😂

[@briskyoungploughboy]

Me too!

[@johncorvo5520]

I find Elon's constantly asking "Okay?" very annoying.

[@JohnSmith-zo6ir]

This guy never understood the assignment and did the wrong homework. The assignment is about transparency and accountability. It not about the singular of printing money for GDP expansion. It's the fact the printing causes inflation in pursuit of falsely inflating GDP growth in nominal terms and therefore reducing the value of the USD globally which weakens its trading position. Secondly, the homework assignment is about what the printed money is being spent on so citizens have transparency of where their taxes are going. LGBTQ programs in Mexico is not a wise use of taxpayers money. Endless wars funded by tax payers to kill people who are of no threat to them is a bad use of taxpayers money. And when those trillions go unaccounted for in offshore banks accounts that magically come back to the military industrial complex and personal accounts of politicians is the assignment. All of these unaccounted for monies go to the expansion of the balance sheet with liabilities greater in value than the assets on the balance sheet. Broke as. And then of course you can't look at the balance sheet in isolation. You have to look at the income statement (tariffs) and cash flow position. Lastly, every major financial catastrophe has been caused by government and the federal reserve. Elon Musk is about CAPITAL ALLOCATION. Where is the money going and to produce what? What value is it adding? And who gets that value? It's definitely not American middle and lower class. This dimwit "professor" who has never created or run a business his whole life never even got the homework assignment correct. Unreal.

[@peterdeuschle78]

He is simply part of the "fraud" MMT. Definitly not an "Austrian"

[@denisdevolder]

First comment that actually makes sense here! Thank you. Although Keen is right about the money creation process, it completely misses the broader point about real wealth creation and national development.

[@SomeCajunDude]

You should get an honorary PhD for this thesis.

[@dondonnysson4973]

He says how it works in the "real world" as he runs his make-believe model. LMAO

[@kamilZ2]

This model does not include import and export. Government spending/debt stimulates domestic and foreign economies.

[@aletheia161]

It's amazing how both Donald and Elon are able to be experts on absolutely everything.

[@jonathanhirschbaum6754]

In your eyes they are experts, in my eyes this is basic knowledge. Your statement says more about you than about them

[@aletheia161]

@jonathanhirschbaum6754 Well, they seem to claim expertise in everything from economics to medicine. Most of us other mere mortals, usually confine ourselves to one discipline and develop the necessary skills. However, as they say: "money talks and nobody walks."

[@jonathanhirschbaum6754]

@@aletheia161 They are not experts in any of it. They consult experts and repeat what they learnt.

[@aletheia161]

@@jonathanhirschbaum6754 Which expert advised Donald that bleach injection was a good idea? Where did Elon get the idea that a monopoly issuer of a non convertible currency, the US, could go bankrupt? Some experts! 🤣🤣🤣

[@roelf8044]

@@jonathanhirschbaum6754 That is one big assumption.

[@mervynhyde1]

Research shows that the Bank of England never uses tax to fund public expenditure, the Bank of England takes instructions from parliament which requests payment for the amount of public expenditure required. That money is created by the Bank of England and put into a consolidated fund, where it is then drawn down by government bodies to meet their liabilities in the private sector or other government departments. So the myth that a government has to borrow in order to balance the books is exactly that, a myth. It does so for political reasons not a financial one.

[@davidbanjo2346]

As a former Chartered Accountant with PwC, a Civil Engineer and an IT consultant, I certainly do not agree with your analysis - that perpetual government fiscal deficits are good for the economy because they increase GDP (via fiats). Nigeria at a time in the 70s and 80s increased government spending and increased annual fiscal deficits astronomically. Of course the nominal GDP correspondingly went way up during this period! But, Nigeria eventually created hyperinflation and ended up on a deep recession with unserviceable debt. Of course the difference here is that America is the one PRINTING and lending itself the money - very little foreign denominated debt. However, irresponsible government spending will always cause inflation which will in turn hurt the working and middle classes.

[@Marko-qy5eg]

I would like an explanation as to how economies collapse. The laws of physics have to explain why things break as well as how they don’t break. If economies can be compared to physics then you should be able to come up with a number. Exceed these debt ratios and we will be destroyed. Stay within those debt levels and we will be fairly safe.

[@wvhaugen]

It is not debt ratios or anything like that. Economies collapse when you lose people willing to lose. Right now farmers and other working class people are willing to work for very small amounts of compensation because they get metaphysical benefits - religion, sense of community, psychological comfort in doing the right thing, etc. When that goes away the system collapses. When collapsologists look at the fall of the Roman Empire, for example, they don't factor in the downturn in the Roman psyche in the year of five emperors (193 AD) or the psychological damage of degrading the coinage.

[@danielpye7738]

Economies collapse when governments get far too much involved.

[@0zoneTherapyCures]

@@danielpye7738 Not true. The economy had far fewer booms and busts when fiscal policy for public purpose was on equal footing with monetary policy. Even Bernanke admitted that "monetary policy is not a panacea."

[@corveramoenglish7275]

What If you tried gov spending at less than 30% and used that to repay gov debt? What happens when the debt exponentially decreases? Will the dollar appreciate? What happens to the government after it pays all the debt? Will it be able to save money to stop borrowing? At which point does it get a surplus equal to the money it was paying? Those are the useful questions, instead of just keeping a flawed model that might not break, why not using these tools to make an action plan which removes the deficit and allows the public to breathe? Thanks for your future answers. Happy new year

[@solyluna1778]

Oh, and Musk is also an economist now! Another "King of Debt!"

[@chingron]

You dont think the richest man in history knows something about money?

[@thomas-k2k8w]

blame people not even in government for what Joe Biden and Obama did.

[@Hirnlego999]

@@chingron Doesn't have to. Trump didn't write the art of the deal either. And certainly one would expect Twitter not to lose so much value if Musk was the genius so many people claim him to be. He's just actually active in too many areas.

[@chingron]

@@Hirnlego999 Wow… that is some serious TDS you got. Who mentioned anything g about Trump? Regardless… you go ahead and keep pretending they are both losers if it helps you sleep at night.

[@Hirnlego999]

@@chingron They basically say that their policies are BAD for you. And some of you don't notice. It's also quite clear that anyone who says TDS hasn't got a clue what happened in the last decade or so. I mean, he even ran a fake university and started his political career with birtherism. Should've been disqualifying but then again, what do you folks ever notice? >Trump Judge Blocks Overtime Pay For 4 Million Workers >Trump Ally Elon Musk Warns of 'Necessary' Economic Collapse if Trump Elected >Trump attempts to take credit for stock market record highs under Biden (even this is so DUMB that it's amazing that you folks give him a career)

[@hamiltonmackenzie3340]

Does your model take into account tax avoidance and corruption?

[@Dbb277-2]

👍

[@joannebottcher9779]

Thank you so much!

[@wvhaugen]

Good exposition via spreadsheets. I do the same kind of thing in my books about sustainable agriculture. The insight here is that creation of fiat currency and creation of credit go hand-in-hand. It continually amazes me that our financial overlords continue to find ways to kick the can down the road. And of course sometime and somewhere down the road the overshot, hypercomplex system will collapse - but not today. I will probably die in my bed with the lights and the heat on. Steve Keen might not and I am sure that worries him. I don't have children or grandchildren, but my partner does. Her children and grandchildren will probably die cold and hungry at the end of an economic system spiraling down the toilet. So will Musk's children and grandchildren. In the future, piles of money won't be worth as much as the ability to use hand tools and grow food. Elon Musk is just a bullshitter who makes piles of money on financialization. His current projects are just PayPal scaled up to the stratosphere.

[@pigwashtroughology4235]

Clear as mud

[@Ziegfried82]

Yeah this is quite convoluted. But honestly it's common sense. Money cannot be made out of thin air. As the USA continues to abuse it's reserve currency status more and more countries will move away from the US dollar and that's how it collapses. I consider the modern economic system to be a fraud actually.

[@jeffguarino2097]

I will have to watch this a few times to understand what he is doing. He is talking way to fast. Maybe some viewers are half familiar with the spreadsheets he is displaying so they can follow it better ?

[@eschwarz1003]

sadly people assume those with extreme wealth must know more about economics than economists

[@falsificationism]

I agree with Elon. We should halve the Defense budget and directly deposit an equivalent amount into the bank accounts of the poorest among us, while writing down household debt to zero, including all student loan and medical debt.

[@Gumardee_coins_and_banknotes]

You can not just half a budget, maybe freeze it is reduce it over the long term. Halving will cause huge problems that will make any situation worse.

[@WarrenPeacenik]

Is that what Elon is saying? If so, I don't care if he doesn't understand the monetary system. Make it so

[@tylermac70]

You could prove to rightist you were serious, be proposing to halve gov entitlements as well.

[@piotrd.4850]

Why defence spending (near historical low at moderate 3,5% of GDP) instead of what passes for healthcare in US - whooping 18% of GDP, when most developed countries get MUCH better and available and debt free care for spending anywhere between 8 and 12% of GDP? Sure, DoD could use cleaning and freezing, but this is peanuts compared to money wasted in US "healthcre" drain directly and in terms of productivity loss.

[@mikekelly5869]

That would result in serious inflation

[@markshirley01]

Question: is it possible to run a country by taxing assets and not taxing work.

[@Don-ry6kd]

Very useful explanation. Money is CREATED when borrowing occurs. (It is also destroyed when repaid, so net borrowing is what matters.) But if too much money is created, the purchasing power of money is reduced (aka prices of everything go up). Too much borrowing is bad, even if Elon didn't give the right reason.

[@mikekelly5869]

You put it in a nutshell. That's why central banks raise interest rates to control borrowing and thus throttle the creation of money.

[@andrewclimo5709]

Great explanation. Thank you Prof Keen.

[@ngauruhoezodiac3143]

So billionaires make their money by indirectly borrowing foreign capital then making taxpayers pay the debt.

[@piotrd.4850]

Yeap :)

[@Sec_coach]

If it’s so easy why are not doing or these top economists who are all broke see the curtains of the dude house 😂😂😂😂

[@caldwellkelley3084]

always educational!

[@EzechuHeadd]

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[@EzechuHeadd]

Only God knows how much grateful i am. After so much struggles I now own a new house and my family is happy once again everything is finally falling into place!!

[@Jackn-d8s]

Wow...I know her too she is a licensed broker and a FINRA agent she is popular in US she is really amazing woman with good skills and experience

[@AthensPatao]

It is very encouraging to see Evelyn Vera here, I started with 3k now with good returns.highly recommended..

[@Jackn-d8s]

Yes of course

[@Jackn-d8s]

This is her WHAT'SAPPS

[@sebastianchmielewski6281]

1st law of Economy: for every economist with some opinion exists at least one economist with completely opposite opinion

[@whitneytrigwell959]

Thank you Steve 🙏🏼💪🏼🧡

[@myalterego2878]

Looks to me like the entire system is based on money; like money is the only important item in the entire system

[@ETALAL]

Thanks Mr Keen great explanation. Your work over the last decade is exceptional.

[@janineclemons746]

It seems simple to me that if we want to pay the debt while growing the economy we shift income from those who don't pay tax to those who do.

[@MrCarlnatalizia]

Excellent explanation

[@joelrunyan1608]

The problem isn't spending... its that the taxes are too low

[@Hirnlego999]

Tax the rich

[@VladimirSuravtsov]

"All textbooks on economy are wrong", just trust me bro, continue uncontrollable borrowing and spending, you will be fine, look I've built some fancy excel model with 6 parameters! 😂 And you know, Musk is wrong because he was afraid of the dark in childhood! You need to just relax and do nothing, just spend your credit card as much as you can and then just simply open the new one, not a big deal! Trust-me-bro-economy 🎉

[@Ziegfried82]

Yes this looks like voodoo economics to me. Modern monetary theory type BS where you claim the banks create money out of what? Nothing. It's fiat. Fake.

[@mikekelly5869]

For a brain that can't comprehend.

[@SomeCajunDude]

just say you didn't watch it

[@Ayanokoji-v1u]

Elon musk is right for his Business Empire. After all he has to do something to maintain it😮

[@pierrydelcy6889]

Very interesting - can you clarify where inflation is reflected in the model please?

[@madb132]

it's not.

[@Ocker3]

I learned in Econ 101 that Government spending $1 results in about $11 of economic activity because of how cheap most governments can borrow money, and as long as they're building useful things then it's easy to pay off the debts as the economy grows apace. It's when the Gov does stupid yhings (like subsidises companies without domestic operations because of lobbying) that money starts to leak out. And if you don't fix the bridges, then economic output starts to drop. Careful investment by households, companies And Governments is vital to ongoing economic growth.