L. Randall Wray - Modern Money Theory: Intellectual Origins and Policy Implications

International and Comparative Law Center (ICLC) Seminar Series,
October 2015

[@mariarinehart8667]

Maybe why some of the premises are so controversial today (surplus to a deficit, an asset to a liability) is that economics has been taught separate of finance/banking/accounting. It is as if economics resides in a tower abstracting from the day to day operations on the ground. I probably need to watch this a few more times, good video with much to think about:)

[@JoyRaptor]

Also watch hidden secrets of money episodes 1-10 on KZbin. Its SO GOOD.

[@jonashayes2508]

Yea why is this so convoluted and abstract. Money is also time in my world not just a creature of the state. It's also value. I have a lot of questions.

[@cdub9510]

The economics profession is there to create metrics to explain the discipline of working-class

[@detectiveofmoneypolitics]

Economic investigator Frank G Melbourne Australia is still watching this informative content cheers Frank 😊

[@thomasd2444]

1:24:16 - Macro accounting and balance sheets 1:24:37 - Very few economists can place assets and liabilities on balance sheets 1:25:02 - They may not wish to understand 1:25:14 - When speaking with USA policy makers

[@thomasd2444]

It took me two KZbin videos, two books, and starting a game of Monopoly using double entry bookkeeping to understand (now 54 days ago)

[@Low_pH]

can u link be the book you used?

[@nthperson]

Given the effect of our systems of law and taxation, it does make perfect sense to give to a national government the authority to issue create currency balances that government agencies would then spend into the economy to pay for public goods and services. This is certainly an improvement over having a bank-owned central bank authorized to issue legal tender balances out of thin air, which the government must then borrower at interest. However, if one is convinced (as I am convinced) that the legitimate source of public revenue is the value of tangible wealth that falls into the category of rents, then the above structure leaves in place the fundamental injustice of allowing the private appropriation of rents (which are unearned to individuals and entities). It is worth noting that the public collection of rents (from all sources) is not taxation. It has been the failure of societies to collect rents that has resulted in the confiscation by taxation of legitimately earned income, that is, income derived by producing goods or performing services.

[@Achrononmaster]

That's a fair point, but the cat got out of the bag way back, so once private ownership of land was allowed the states forfeited the chance to be the single rent collectors. But they can still tax land or real estate as Wray suggested, just gotta find tough enough politicians. So this will not occur first in the USA. Some other country will adopt these insights first and show how they are superior and can provide full employment without high inflation. ut your main thesis is correct, it is bets to tax unearned incomes (economic rents).

[@nthperson]

@@Achrononmaster Importantly, there is real world experience with the public capture of rents. Local property taxes all across the United States capture some level of rent. However, only in Pennsylvania is there a constitutional provision that permits most town and cities, boroughs and school districts to tax assessed land values at a rate different from that imposed on the assessed value of buildings. About 20 local taxing bodies tax land at a higher rate than buildings. One or two impose no tax on buildings at all. Recently, a city in Germany has pass legislation to move in this direction.

[@peregrinedalziel4999]

@@Achrononmaster Hang on though. To correctly subdue inflation the tax should remove income that is likely to be spent. Taxing "wealth" removes "hoarded capital" usually held by people that aren't spending all that wealth, and if they are, its probably not buying things in the CPI. Bezos buys 1 less super yacht because of the wealth tax- unlikely to affect inflation. A similar nominal amount of tax imposed on thousands of workers will probably reduce, at the margin consumption of the sorts of goods we don't won't to inflate. That said, a wealth tax would still require payment by either selling assets (...and reducing the cost/price of capital) or (god forbid) earning an income. Both of which seem to me to be be anti-inflationary. Am it right?

[@liberalismosolidario8503]

Please set the video language to enable auto-captions.

[@johndhaskell]

hi, no longer running the series, but good point and will write the school to request they do this. thanks for catching this.

[@talkingcloud740]

The reason to replace people with robots is because they don't make mistakes, don't take holidays, work 24/7 and they are cheap to run though not to install. Once installed there is increased profit and production for the corporate or service provider. The change is inevitable, even in the care sector. Some argue this will create new job opportunities' but there are very few so far, mostly there are lay-offs on a grand scale. This is global, pronounced in Japan

[@KenjiKatsuragi]

What is visible when MMT is not defined as a philosophical framework of social reform, but when seeing finance in 'flow of currency issuance and recycling'? And as for tax revenue is "refund of currency", you can clarify the significance of income redistribution there.

[@donaldclifford5763]

Is private sector investment in any way similar in terms of money creation to the government spending function? Since money creation by itself does not create market value, how would you relate real production, as in GDP, to the cycle of money creation?

[@joebhed1]

That type of question can only be answered by understanding the role of money in a national monetary economy. archive.org/details/roleofmoney032861mbp Enjoy.

[@geodgereturns]

Great stuff! Skimming the comments section it does sound like it's especially difficult to get folks to separate the "truths" about currency & debt from the "opinions" about social policy. There's the "war is going to kill people and break things" argument versus the "war is going to bankrupt our grandchildren". There's the "we need the elderly to stay in the labor force because without them we don't have enough workers to grow our food and keep our power plants operating both" versus the "we need the elderly to keep working because their retirements are bankrupting their grandchildren." There's the ying "rich need tax giveaways as incentives to help society find cures for cancer" versus "rich are bankrupting our grandchildren", or the yang "poor need to be hungry and desperate to feed themselves as incentives to help society find cures for cancer) versus "rich / poor are bankrupting our grandchildren". It's like the battle over the debt is really just a proxy war to gain advantage in other battles, and the resistance to admitting the truth comes from a kind of subconscious sunk cost investment in a "how we gonna pay for it?" propaganda device to hijack debates over policies that trigger cognitive dissonances debating "social benefit" versus "private benefit". Ever since Adam Smith was hijacked to advance this blanket mantra "private benefit" = "social benefit" woowoo, simple, common sense arithmetic was given a back seat such that now simply evoking plainly evident, demonstrable, "show your work" provable! accounting! like records of flows of funds, balance sheets are "waved away" when it comes to macroeconomic policy. Not so in the microeconomic realm, mind you. No enterprise requiring external validation (be it auditing tax returns, loan applications, buyers or investors) is allowed to "wave away" balance sheet arithmetic. This woowoo hijacking of macroeconomics (in Adam Smith's name) has provided sooooooooo much ooomph to certain key political ideologues (eg the ideology of neoliberal economics) that it's become the **lingua** **franca** for **realpolitik**. That's why political opponents on both left and right today both speak it ( **lingua** **franca**) and why they employ it ( **realpolitik** ). The identity "truth" is that private sector savings = public sector debt. "Truth" that our government spending creates dollars, and taxes destroys them. The "truth" that the US govt can always cover its debts, and that the notion of govt "paying down debt" to prepare for some future, unforeseen economic circumstance is financial meaninglessness. Because it's largely the "I wanna see" or "I don't wanna see" policy arguments that keep cropping up again and again debating the macroeconomic debt=savings relationship, the "truth" we're not supposed to know?! And politicians who duck away from admitting it even while they know better do so for the same reasons?! It's like politics is a game of lies because politicians are fully aware we Want It To Be. So one of the "tricks" they use to duck the troublesome policy debates in the public policy arena is by taking the real debates underground, using the "how can we possibly pay for it? " ruse, that total nonsense, as the decoy. Which is they pretend away the savings=debt identity, hiding under **laissez** **faire** and **antilaissez** **faire** woowoo economics. De-regulated banking money creation "self-correcting"?! Government spending money creation "unsustainable"? As If, As IF! AS IF there aren't like mountains of real world evidence sufficient to debunk these theories besides the fact defending them require employing this new, ideologically defined imaginary arithmetic rules set. The "bankrupting our children" scam is a proxy war instigated by "you can't handle the truth" policy wonks (aka as "we don't trust you with the truth" policymakers and anti-policymakers.) And we continue to prove they're right, that we'd would rather be lied to, when we resort to it ourselves to derail the debates over the merits (or lack thereof) in real terms of the policies themselves.

[@Rob-fx2dw]

geodgereturns. You seem to have had a lot to say on this post but what you said (and Randall Wray says) about debt and taxes being destroyed is totally wrong and disproved easily by the following facts. Taxes do not get destroyed by the government after being collected. They are spent again to pay for programs and this is evident in the fact that the Federal budget Deficit does not equal the total of Federal spending which it would if taxes wee not there to reduce it to a small percentage or to reduce it totally which is evident in years a of a Federal budget balance or surplus. From 2008 to 2018 the sum of US budget spending was approximately 37 trillion (in 2009 terms). The national debt was roughly 10 trillion in 2008 and then in 2018 it was roughly $21 trillion. If the taxes were used to support the majority of spending the National Debt would have been well over 40 trillion . It alone is proof of the fallacy that taxes are destroyed.

[@thomasd2444]

@@Rob-fx2dw two books for you : DIAGRAMS & DOLLARS by J D ALT (kindle) THE MILLENNIAL's MONEY : Why the Next Power Generation CAN Afford to BUILD a Better World by J D Alt

[@Rob-fx2dw]

@@thomasd2444 You seem to have no idea about what happens in reality when you are swallowing a rubbish J D Alt explanation that does not stand up to scrutiny. It's fairy story. If Alt's idea of how money is created and taxes cancel out money instead of being spent again to fund government programs had any credibility it would have to explain why that is at all realistic and not fantasy. He needs to explain the mathematics of the US national debt (the net sum of deficits ) has not grown to over 40 trillion dollars from the 10 trillion it was ten years ago given the spending of the Federal government over the same period was 30 trillion. By MMT's explanation taxes are destroyed and treasury bonds as well as taxes don't fund government spending so why would the sum of spending not push up the national debt and where would that new money come from. Perhaps you can explain the mathematics of that.

[@MrKongatthegates]

Taxes and fiscal policy are in the realm of congress, QE and monitsry policy is the realm of the fed, which is independent of politics. So trying to prescribe policy using the feds powers is silly. In the US it dosent work that way.

[@thomasd2444]

1:41:40 - 1:41:54 - The Euro 1:42:09 - Secondly a reserve currency must be obtainable 1:42:35 - Or borrow Euros 1:42:42 - Borrowing is less desirable than earning the reserve currency by export sales

[@thomasd2444]

1:38:00 - 1:38:50 - 1:39:04 - USA face insolvency? 1:39:23 - 1:39:51 - The USA-Dollar will remain the main international reserve currency longer than expected

[@thomasd2444]

1:25:30 - USA selection of person to head the FED 1:25:47 - Ben 1:26:11 - USA selects political appointees to "head" the financial sector 1:26:21 - Also part of the problem is to be good at explaining

[@toldu21]

ur prediction was correct with China, from the yr 2022

[@paulspring105]

Listen Rob - You really need to pay attention to what he said - you've missed the point. He did NOT say a sovereign gov't needs taxes to raise money - he said taxes are needed to legitimize the sovereign currency by artificially creating a demand for it.

[@Rob-fx2dw]

Hopeless lack of thinking Paul. Taxes do not relate primarily to money. They relate primarily and ultimately to the production of goods and services without which taxes aren't even wanted by their own government. Neither is their own fiat currency wanted by their own government without production of goods or services. An example is Zimbabwe where their own government ditched it's currency since it eventually was not able to buy any goods or services. There are plenty of examples in the last 60 years of where sovereign currencies have fallen to zero despite taxes. Besides that how could taxes create a value for money by making a demand for it? It's impossible to believe that taxes create a value for money if you look at the facts and that includes the reality that sovereign nations with their own taxes and own currencies have experience inflation that caused their currencies to be worthless. So that belief is rubbish.

[@luckylui3282]

Only work creates "value" in a monetary context. End of story! Money is simply a device to communicate this information. MMT has created the tax narrative as a political maneuver to support the "theory" (i.e. gov spends first) and to make it palatable (not to mention continue the subjugation of people) to politicians and bankers. They know people are generally ignorant about money, especially the abstract aspects, so anything that sounds reasonable will fly on that front. And if it reinforces the master / slave relationship all the better. Sad, but true, and, maybe, simply a hard reality of how large groups of people need to be organized.

[@Stewiehleba]

@@luckylui3282 So basically your argumentation against MMT is to put your fingers in your ears and should LALALALALALAL. Got it.

[@luckylui3282]

@@Stewiehleba Or, maybe, your reading comprehension is not very strong.

[@fachriranu1041]

@@luckylui3282 IMO tax is a tool to reduce money from a arbitrari cycle of economy.

[@davidwilkie9551]

Starting to get the real-time realization of the MMT analysis, thank you. The Philosophical perception meaning of self-defining measuring modulation meaning that is obtained Scientifically by training Intuition Intelligence in practical learning by doing experience and memory associations, then applying the sum-of-all-histories here-now-forever perception integration process, ie Temporal Theoretical correspondence with the re-presentation of concepts in Actuality, Holographic Principle.., this is what a PhD in any field of research is expected to do. Michael Hudson's research context is basically the story of development of Primary Industries and the "Carbuncle" of Financial manipulation, as Criminologist Professor Black calls it. MMT emerges naturally as a partial diagnosis of the biological situation, in academic terminology.

[@keithclarke4275]

So! what happens if other countries simply stop buying U.S treasury notes/bonds etc , would this bankrupt the U.S economy??

[@thomasd2444]

1:34:47 - Ideally the tax-on-bad, eliminates the bad. 1:34:52 - The goal of a "bad" tax is to get rid of the bad behavior 1:34:56 - The ideal is to drain no money from circulation , at all. 1:35:00 - No Smoking 1:35:10 - The ideal tax to drive a currency is a board-base tax that cannot be avoided

[@baronmeduse]

Don't need your running commentary.

[@GenghisVern]

1999-- love to get a pic of those WSJ articles. Evidence!

[@slouch186]

MMT is hard to fully accept because it runs contrary to our own experiences with personal finance. we are all currency users, we do not issue currency and we do not think of our money in the same way that the government does. even if us regular people can listen to the lectures and understand logically that the government can not go broke and that it doesn't have to care about running at a constant deficit, this is unrelateable on an emotional level. it sounds too good to be true - mostly because the other potential negative impacts that government spending could have on the economy are not very well understood and don't get explained in a lot of great detail. so with the concept being deeply unrelateable and the idea seeming a bit like the set up for a get rich quick scam, i think a lot of people are quick to reject (or at least fail to embrace) the idea as a whole. just a thought on some of the obstacles to explaining MMT to others

[@carolisaac5459]

Do you print your own money? The government does. Households are not like a sovereign government.

[@MichaelHabner]

This is true. The concept that the money system is supported by force is alien to commoners.

[@thomasd2444]

1:32:28 - Bad taxes must go 1:33:28 - Bad taxes must go 1:34:03 - Could be better tax 1:34:37 - Taxing bads are better 1:34:45 -

[@davidwilkie9551]

A distinction between primary production and imaginary values is typical of everyday life and thinking-visualisation of managing situations, Be Here Now.

[@zorfaV-ziqtys-7nofda]

All money is debt, but the government selling bonds is not the government going into debt? It is the government having Dollars issued to it by the central bank that it must repay? If the Federal Funds rate is influenced by the Treasury selling bonds that has no affect on the that is bond is a debt obligation that the government is obliged to repay.

[@thomasd2444]

1:18:26 - Q & A 1:22:45 - 1:23:20 - 1:23:40 -

[@Sorenzo]

Can anyone tell me if MMT suggests that European countries should leave the euro and stop pegging their currency to the Euro? Would the same theory hold if you had 5-10 independent currencies in Europe? Would it have significant downsides?

[@Sorenzo]

+Emil Sørensen I suppose the same question can be asked for the individual US states.

[@GeoffCoventry]

+Emil Sørensen Yes, much has been written about the Euro from an MMT perspective. Search the Levy Institute papers for starters.

[@911truthfarmer]

The issue i have with some prominent MMT advocates, and I am also an advocate, is that they say the U.S. Govt issues it's own currency.no, it borrow it's currency into existence from the ring Fed at internet, when it could and should go back to issuing Treasury notes.

[@a46475]

What does the government do with the proceeds of bond sales. If it spends it, how is that a reserve drain?

[@cdub9510]

The federal government neither has nor needs US dollars to create by decree. Any revenue or Redemption it receives is merely deleted

[@thomasd2444]

1:28:06 - They fear inflation more 1:28:46 - 1:28:56 - What could be worse ? 1:29:04 - 1:29:24 - 1:29:44 - Hard to be optimistic about the state of democracy 1:30:24 - 1:30:40 - 1:31:00 - 1:31:29 - Taxes as punitive 1:31:44 - BitCoin 1:32:17 - 1:32:17 -

[@issamissa902]

This is very informative, thank you.

[@thomasd2444]

1:40:13 - Eventually the USA-dollar will be in less global demand ___________ Most of the world will wish to buy things made in USA 1:40:34 - Some Americans might have to get jobs 1:40:40 - jobs in the USA to make things for domestic consumption 1:41:20 - the next financial crisis

[@bobby33x97]

Why doesn't MMT work for Venezuela or Zimbabwe?

[@cdub9510]

Because bad policy and foriegn intervention caused there to be no resources available to purchase. Hyperinflation has never begun by creating currency. If there is no bread, no amount of currency can buy it.

[@pernalongaoburgues194]

Venezuela is unable to produce its own food, they import everything from Brazil, it is a country that depends on oil. Disease Holland, comparative advantages and few industries.

[@paulwary]

Doesn't the existence of compound interest, applied everywhere, complicate this zero-sum arithmetic horribly?

[@dhagos]

Paul Wray depends how good you are at math I suppose. Simple answer the higher the interest rate is the larger a deficit the government needs to run since they need to cover borrowing plus interest. Otherwise there won’t be enough money created to cover loans plus accrued interest.

[@thomasd2444]

1:24:00 - Representative Agent : An economy with one person who maximizes Utility thru time

[@earlpierce7173]

@ L. Randall Wray So, if banks create new money via demand deposits and the fed has to back the bank with the reserves they need to meet requirements, then what is the point of selling interest bearing bonds to the banks to drain reserves if the fed will only ensure the reserves requirements are still met?

[@luckylui3282]

Once one wades through all the BS, at the very root, reserves and related bond sales are simply a game of three card monte. A mechanism to give banks free money (both on the spread and rate change effects on bond prices). In addition the "lender of last resort" is a distraction which CREATES moral hazard as a FEATURE of the system.

[@cdub9510]

They are subsidies for those that can afford them and a means to punish countries pegged to the dollar

[@thomasd2444]

0:00:00 - No Transcript. Oh Noooooo Mr. Billllllllll ! 0:00:23 - M C SCHOOL of LAW OCT 2015 0:00:27 - Introduced . Understanding Modern Money:The Key to Full Employment and Price Stability (1998) Modern Money Theory: A Primer on Macroeconomics for Sovereign Monetary System 2nd edition (2015) . 0:01:20 - 0:01:55 - Brief personal history : Early 1990's 0:02:00 - 0:02:50 - New terminology : Sounds like 0:03:00 - 0:03:20 - 0:03:34 - One idea: Fed Bonds = Monetary policy ___________ Treasury Bonds = Borrowing = Fiscal policy 0:03:40 - In the early 1980s 0:03:47 - 0:04:13 - Central Bank Branch & Treasury Branch 0:04:20 - 0:04:23 - Both affect Private sector identically 0:04:40 - Pamphlet titled SOFT CURRENCY ECONOMICS by Warren Mosler 0:05:00 - Books By L Randall Wray : Why Minsky Matters: An Introduction to the Work of a Maverick Economist Money and Credit in Capitalist Economies: The Endogenous Money Approach Understanding Modern Money: The Key to Full Employment & Price Stability (1998) Modern Money Theory: A Primer on Macroeconomics for Sovereign Monetary Systems 0:05:14 - 0:05:36 - Until the Blogosphere , www , internet google M M T 0:05:40 - 0:06:05 - 0:06:30 - book titled THE MODERN MONEY PRIMER (2012) & Updated (2015) 0:06:55 - Summarize basic conclusions and history of thought 0:07:07 - Most of what is within MMT was knowledge known and lost. 0:07:32 - 1st : Philosopher-Sovereign Currency Issuer unique. 0:07:59 - Sovereign-Philosopher chooses the Unit of Account 0:08:19 - Sovereign-Philospher issues a currency in unit denominations 0:08:35 - Sovereign-Philospher lays & collects taxes in currency 0:08:43 - Sovereign-Philospher accepts payments of tax w/currency 0:08:58 - Prices of things purchased listed in the currency 0:09:07 - Contracts are written in the money of account 0:09:20 - Spectrum of exchange rate regimes to choose from 0:09:33 - A floating exchange rate provides the most domestic policy space 0:09:42 - Exchange rate spectrum option : Manage Exchange Rate 0:09:52 - Currency-pegged-to-_____ exchange rate spectrum option which ___________ reduces domestic policy space. 0:10:01 - Sovereign-Philospher could adopt another Sovereign-Philospher's ___________ unit of account & currency 0:10:08 - Ecuador . Examining the Effects of Dollarization on Ecuador tinyurl.com/y5feu4fu . Outsourcing the Money Supply by Eric Schnurer tinyurl.com/yy5n4xd3 . 0:10:15 - Sovereign-Philospher adopt a unit of amount fixed to any object ___________ for example Gold or Sterling Silver or Licorice 0:10:18 - Adopt the EURO 0:10:27 - If the goal is to maximize domestic policy space : ___________ 1) Adopt individual Sovereign unit of account & currency ___________ 2) Float value of your currency with respect to all others ___________ currencies and all purchasable commodities. 0:10:41 - The Problem with Fixing any Rate of Exchange 0:24:00 - . 0:41:00 - 0:41:12 - Brief review of Intellectual Foundations of MMT 0:41:29 - Builds upon economists who wrote works on 0:41:59 - Credit - Credit $$$ - Circuit-ist approach 0:41:54 - Endogenous $$$ approach 0:41:58 - Functional Finance 0:42:00 - Financial Instability Hypothesis - State Theory of $$$ 0:42:16 - 1st : Geo. Fredric Napp's book State Theory of Money 0:42:45 - J.M.Keynes wrote Treatise On Money (1930) 0:43:12 - Very young Keynes editor of THE ECONOMIC JOURNAL 0:43:24 - Keynes reviewed two articles written by U.K. ___________ Ambassador Alfred Mitchell-Innes . www.newmoneyhub.com/www/money/mitchell-innes/what-is-money.html . www.newmoneyhub.com/www/money/mitchell-innes/the-credit-theory-of-money.html . Book Martyrdom in our times: Two essays on prisons and punishment (1932) . 0:44:04 - 2 articles on $$$ - (1913) & (1914) 0:44:17 - Keynes reviewed 0:44:28 - 0:44:58 - This false 0:45:06 - Then he tells a different origin of money 0:45:17 - 0:45:25 - What of $$$ in Babylonia ? 0:45:30 - Did money come from the authority of social order? 0:45:40 - Earliest units of money = weight measure of grain 0:46:24 - Quote 0:46:57 - Origin of $$$ 0:47:30 - 0:48:00 - 0:48:41 - Coinage expert , Greerson 0:49:05 - Historic German practice of injury compensation 0:49:30 - Now pay debt to society , not victim 0:49:45 - $$$ arose not from commerce market but from 0:49:57 - Punishment, Fees, Fines ... Original sin 0:50:05 - escape everything except death & taxes 0:50:17 - $$$ - Religion 0:50:21 - 1st social authority : Religion 0:50:35 - What is money ? Record keeping 0:51:03 - All $$$ = debt of the issuer 0:51:40 - Currency is debt of issuing government 0:52:04 - The STATE (Governing authority) 0:53:35 - Charles Goodhard : 1 Country & 1 Currency 0:54:50 - Central Bank 0:55:18 - Supply & Drain reserves to set rate of interest 0:55:35 - From 1970's the Post-Keynesians argued 0:56:46 - P-Keynesian's wrote in 1980's 0:57:35 - From heterodox came this Given/Rule/Principle/Tally 0:58:04 - Next : Abba P. Lerner : FUNCTIONAL FINANCE ___________ economic theory proposed by Abba P. Lerner, based on effective demand principles & chartalism. It states that government should finance itself to meet explicit goals, such as taming the business cycle, achieving full employment, ensuring growth, and low inflation. . www.levyinstitute.org/pubs/wp_900.pdf . 0:58:11 - SOUND FINANCE vs FUNCTIONAL FINANCE ___________ Monetary & Fiscal Policies 0:58:28 - Politician vote-getting view 0:58:37 - Households cannot continually deficit spend ___________ cannot survive with credit cards 0:58:45 - A Sovereign Government which issues currency 0:58:49 - Sovereign cannot bankrupt 0:58:53 - Sovereign should not think itself a household 0:58:57 - Sovereign Government's Interest is Public Interest 0:59:00 - Balanced Sovereign Budget has no Public Interest 0:59:19 - Sovereign Financing Functionally , Public Interests 0:59:26 - WHAT IS THE INTEREST OF THE PUBLIC ? ___________ FULL EMPLOYMENT & Relative Price Stability 0:59:46 - If people are not employed, then either ___________ taxes are to large or spending is too low 0:59:55 - Adjust taxes & spending ___________ to achieve FULL EMPLOYMENT 1:00:02 - If SPENDING is too large & taxes too low, ___________ then INFLATION 1:00:10 - Adjust : Reduce Spending & raise taxes 1:00:21 - Monetary Recommended Policy ___________ When too much money chases too few goods, ___________ then issue bonds 1:00:35 - When people have too little money chasing too ___________ many goods, then issue less bonds (Drains) 1:00:48 - Bond purchases 1:01:09 - Beardsley Ruml , Chair of Fed Bank of N.Y. 1:01:44 - TAXES FOR REVENUE ARE OBSOLETE . home.hiwaay.net/~becraft/RUMLTAXES.html . 1:02:37 - Taxes have other purposes 1:03:00 - Hyman Minsky : Financial Instability Hypothesis ___________ Stability is DESTABILIZING 1:03:43 - Beginning in 1992, from the work of all these economic ___________ thinkers, the crisis of the single Euro could be ___________ described in writing 1:05:52 - Last piece in the history of thought that led to the ___________ the development of M.M.Theory is : ___________ THE EMPLOYER OF LAST RESORT 1:06:00 - 1:06:06 - If any unemployment, then eliminate with govt. spend . 1:08:57 - Policy Implications 1:09:00 - Stop saying we can't afford Full Employment 1:09:09 - Proposals for spending can be good or bad 1:09:55 - Those not privately employed then govt. employ 1:10:00 - Public Infrastructure not profitable to private 1:10:15 - And stop talking about about Fed Bank as ___________ being independent of GOVT. 1:11:12 - SEE -- SAW TEETER -- TOTTER -- Balance Scale 1:11:13 - Balance IS balance . www.levyinstitute.org/pubs/pn99_3.pdf . 1:11:35 - In 1999 : W$J Column Left _____ W$J Column Right ______________________ U S Govt Surplus _____ Private Sector _______________________ Adds To Saving _____ Deficit reducing $$$ 1:11:39 - W$J 1999 Two Stories ___________ GOVT Sector Surplus GOOD ___________ Private Sector Deficit BAD 1:12:00 - 1:12:17 - Neither COLUMN knew what the other Column was doing. 1:12:22 - A mathematical Identity 1:12:25 - 1:12:29 - Understanding the connection GOVT to PRIVATE 1:12:36 - If you like private saving, then like GOVT deficit 1:12:50 -

[@gabriel3888]

tism.

[@philwohlrab7588]

That bit about George Soros was fascinating. Did not know!

[@Achrononmaster]

I was a bit disappointed Wray did not answer the last question fully. It was really about small open economies who could lose import capacity, and thereby become technically "insolvent". The short answer is this question conflated currency insolvency with import capacity, they are not the same, a nation that has some export capacity will always, absent corruption & colonialism, have a commensurate import capacity, and need never be insolvent in their own currency of issue. Their currency will always be just as strong as what people need to do to earn it. In such nations it is _even more important to run full employment policy,_ not less! The long answers are: First, is that this hardly ever happens that a peaceful but resource poor nation becomes insolvent in their own currency, it just doesn't happen, and cannot happen to any catastrophic degree provided the country adopts a floating exchange rate. The nominal prices will adjust, so that in real terms the country can always get back in imports roughly what it exports, in real terms. Will that mean their people will be working hard to send their goods overseas? Yeah. No way around that. Second: any country that has no export capacity probably has also insufficient domestic capacity (maybe they cannot grow enough food or supply their people with enough electricity), and although it might sound harsh, the answer for such a country is to join other countries in a trade union or form international cooperatives so they get aid from friendly neighbours (many pacific Islands are in such positions viz. Australia and NZ, also Hawaii is a classic example, Puerto Rico a dystopian example of how not to do a dependency). In short, they can never be sovereign & have a high standard of living and must choose one or the other to some degree, not do it by halves like Puerto Rico, and so running a sovereign monetary system will still be possible but they will have to be content with a lower standard of living than their neighbours who have more natural resources. But then, of course, they will never be insolvent and can always guarantee full employment, and so they can live peacefully and happily, and slowly over time raise their standard of living. Not all countries need to aspire to be like the USA and live in mansions and drive SUV's, in fact having worked in the USA for almost a decade I sure do not want to go back there if I can avoid it, except maybe for vacations in their beautiful scenic areas free of mansions, Starbucks and SUV's. Third, the Earth should be regarded as one country, nations are artificial, but there are plenty of natural geographic and agricultural regions, and these natural regions should be helping each other like members of a family would. They can still call themselves nations and countries, but to allow another nation to suffer while your nation has surplus is just barbaric, why would we allow that? (rhetorical question that!)

[@thomasd2444]

1:43:25 - China does not want that role 1:43:38 - The country of the International Reserve Currency has to behave 1:43:46 - When the Great Financial Crisis hit, the Federal Reserve Board had to originate ___________ $29 TRILLION in LOANS

[@MikeNewland]

Government has two ways of spending without inflation. Print the money and tax it back. Borrow existing money thus balancing up expenditure with extracting it from existing holders. Why one rather than the other?

[@cdub9510]

Why woukd it borrow that which it already created?

[@thomasd2444]

1:35:35 - Hut Tax 1:36:40 - 1:36:53 - 1:37:45 -

[@paulfowler981]

question, why can't money have it's value just because it is the legal money product that we all have agreed to use to get wages and buy goods, and it is also legally enforced? not just taxes give it's legitimacy

[@cdub9510]

Currency is numbers on a spreadsheet at the Treasury. You agree to use it because the tax created unemployment. You must become gainfully employed to pay the tax.

[@bobby33x97]

At least he admits the Fed is a Branch of the Fed Govt!

[@unbrnwsh]

Rob Mews It's commendable you took so much time to dispute what Wray is saying. If you took the same time to listen carefully with an open mind, to what Wray and the other Modern Money Theory guys are saying you may be able to see the logic and the truth to what they say. Most of us were indoctrinated to believe what you currently believe and consider govt should be run just like your household. But Wray and others are giving facts to prove that is not true. Especially in the USA govt could play a major role so that we have no poverty in the nation, everyone has a job that pays him well to live a good life and put something for retirement, everybody has healthcare, everybody can have a good education etc. All these are possible if one can understand modern economics that is based on sovereign currency. Such a system is not acceptable only to a few at the top who currently get enough govt welfare to control everyone else and make the majority work for them like slaves. That few also control media, economists and politicians who tell you how to think according to what's good for them. I hope you will be able to see what's good for you sooner or later.

[@joebhed1]

Wrong. Wray et al merely "postulate" a hypothetical, "that the sovereign government is the monopoly issuer of that which serves as money in its national economy." Just ain't true, or even close to true. You gotta read a little closer , Andrew. Or, tell me where the government utilizes its sovereign money power in creating any money that matters in the real economy in the achievement of MMT''s full employment goals. Thanks. Yes, I've read all the books, ans was on that thread Randy discussed here.

[@joebhed1]

LOL, yeah, right after the government "borrowed" them, from the bankers and the taxpayers - ever seen the "revenue' side of a government budget? Ever heard Dr. Kelton's present at this year's Minsky conference? It's over there ----->>>>>> in the margin. Get a life. Learn. Then speak. Again, where does the Fed say money is created ? I suggest you read the Fed's historic publication on this subject: MODERN MONEY MECHANICS _ A Workbook on Bank Reserves and Deposit Expansion. archive.org/stream/ModernMoneyMechanics/ModernMoneyMechanics_djvu.txt Now Out Of Print. But I have one at home. For the Money System Common

[@ast453000]

Hi Joe, Can you tell me where you think a dollar bill comes from? Just to be clear, I mean the paper, green and black thing in your wallet.

[@joebhed1]

Hi 453, Where do they come from? Whenever a commercial bank Member of the FR system needs FRNs, they order them through their Reserve Bnk, and the Reserve Bank orders them from the Treasury Bureau of Engraving and Printing After they're printed, they're distributed / shipped to the Reserve Bank at the cost of printing / production, and basically the FR bank 'sells' them, via collateralization, to the bank that needed them in the first place. The bank puts them in the vault and they enter actual circulation when the bank passes them on to customers. www.treasury.gov/about/education/Pages/distribution.aspx www.newyorkfed.org/aboutthefed/fedpoint/fed01.html Thanks.

[@ast453000]

So would it be right to say that all legal paper currency and coins come only from the Treasury Department, which is a branch of the Federal Government?

[@wianamatta60]

Rob and Joe you indicate to me that you have misunderstood Randall Wray and have misrepresented what he is saying.

[@joebhed1]

how so? misunderstood ? i've read all his books cover to cover. whaddaya think he knows best? taxation drives money ? or, money IS debt? or, what?

[@waynemcmillan5970]

Joe Can I ask you seriously in a spirit of unbiased intellectual enquiry, what you primarily believe is wrong with MMT? To me Mosler and Wray represent an understanding of what actually happen in the financial sector, not what is taught in the academic textbooks which is fallacious.

[@joebhed1]

Wayne, thanks. lad to. And you would know what I think if NakedCapitalism, and others had not blocked me from commenting and deleted several years of my comments.MMT is rather thin-skinned when it comes to criticism, but, for good reason. So, first…. - The Government DOES NOT create money when it spends, or, by spending ….. our limited experience with Guv-issued money was Greenbacks (and they circulated freely in our national economy for 135 years and were 'accounted 'for throughout). - Of modern economies, only Canada and Germany had any experience with “public “ money…. Canada from ’35 to ’76, and Germany from ’35 to 45. The BIS shut down the McGeer-Canadian system, and the war ended Feder-Germany one. - So, there’s no such thing as “A sovereign government THAT issues its own money(currency in MMT parlance) - Taxes do NOT drive money; national money statutes drive money. - Meaning, Public money does NOT need to be issued by Gov BEFORE the Guv can tax it back for spending. We don’t pay taxes with Guv-issued monies; we pay taxes with bank-issued ‘credit, and that whole ‘taxes-drive-money’notion is a charade. - Government NEEDS money (bank-credits) in its TGA before spending and that ‘money’ must come from taxes and borrowings (both borrowed from the national economy, with taxes paid back in the same year and borrowings when the note is ‘re-funded) - The government does NOT shred your cash-tax payments when received, because …. See above. Shall I keep counting the ways, or do you care to posit any credible tenet of MMT for consideration, and I don’t mean “Post-Keynesian economics (job-guarantee or Basic Income), which I fully support. Thanks.

[@waynemcmillan5970]

Thanks Joe for your reply, I appreciate that and look forward to reading more from you. Have you written any essays or books on how sovereign fiat currency governments operate in the 21 st century that I could read?

[@waynemcmillan5970]

Joe I am aware that you are connected with the American Monetary Institute and belong to the New Currency School, which is very close in its thinking to MMT, but certainly has some differences of opinion about fractional reserve lending, govt debt and the purpose of taxes. I have read Joe Huber"s critiques of MMT and I think it gets down to a matter of opinion and ideology. Which school of monetary thought is the more accurate and has the best policies for the majority of citizens?, well time will tell which school gains in popularity among citizens. In the mean time I think we should keep an open dialogue going..

[@paulwary]

My (untutored) impression is that this is similar in principle to mass or energy balances of a system, as used in eg chemical engineering. Seems strange to me that this seemingly foundational material is still a matter of debate in economics. I am also left wondering what 'theory' means in this context, when everything under discussion is man-made. Seems that several things are conflated - how the system ought to function, theory of function in the abstract, and how it actually behaves empirically.

[@robinswamidasan]

"Seems strange to me that this seemingly foundational material is still a matter of debate in economics." As a scientist and engineer (I studied Chemical Engg.), I concur wholeheartedly.

[@fachriranu1041]

Exactly......

[@cdub9510]

It's historical fact that cannot be refuted.

[@kainalrik]

taxes, especially in a fiat system, are used for social manipulation and often subjugation, like regulations and laws can. the best practice taxes can accomplish, however, is to remove idle wealth that has no velocity and leakages from the local market. a majority of people crave dollars to pay for necessities and other resources, not to pay taxes. It's to cover demand for the output of resources, that's why they take out personal loans. banks make the money through personal loans to cover demand, that's called cost-push inflation. m(v)= p(q) too much federal spending only causes inflation if spending is persistently higher than output of resources. that's called demand-pull inflation. this is most likely to happen when there is austerity, gov surpluses and outlandish spending on things such as defense and other things that produce very little output of recourse. inflation in and of itself is not bad. There is cost-push inflation and demand-pull inflation. these can result in stable inflation, acceleration inflation, deceleration inflation, and hyper inflation. the goal is usually stable inflation. The Fed only controls (p)price through interest rates.

[@talkingcloud740]

If the government can and should take up the slack from an economy in which tech robotisation & AI software is replacing & preferred to human waged labour in buying the "burgeoning unemployed" surely this should be in the form of an adequate basic income that would allow for costs of new skills training and where applicable - mandated work in the environmental sector such as brown field recovery, wild places management, roadside gardens? etc. (all manner of necessarily yet not easily privatised for profit work) this would not cause any drain on tax, and if it will then clearly a new system is required. (there being no taxes from waged workers available, or hardly any)

[@kainalrik]

taxes are used for social manipulation. the best practice taxes can accomplish is to remove idle wealth that has no velocity. a majority of people crave dollars to pay to necessities and other resources, not to pay taxes. too much spending only causes inflation if spending is persistently higher than output of resources. that's called demand pull inflation. this is most likely to happen when there is austerity and outlandish spending on things such as defense. inflation in and of itself is not bad. There is stable inflation, acceleration inflation, deceleration inflation, and hyper inflation. the goal is usually stable inflation.

[@qones3574]

Don't we want there to be a balance between labourers and capitalists? We use savings to loan entrepreneurs money, and then a portion of them default if their business fails.

[@wuyeelok]

Loan create deposit, not the other way around. www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2014/qb14q1prereleasemoneycreation.pdf

[@ArilandoArilando]

51:00

[@inspiringhuman-being184]

Can I every be at least a millionaire?

[@isawaturtle]

Rob Mews you take easy to understand ideas and confuse yourself and try to confuse others ... I don,t know if its because you want to sound clever but you've failed ... that is a whole lot of your time that you're never going to get back.

[@mikewatson2270]

Rob with the empty channel, writing comment after senseless comment, misspelled and incoherent. Rob is a TROLL. Skip reading Rob's arguments and save some time. Or, spend the time conscious that you are reading the work product of a TROLL.

[@neilanderson891]

@Mike Watson - Comments posted by Robert Franks aren't senseless. He's thinking "critically" to see if MMT makes sense. Obviously, you don't have anything sensible to say in defense of MMT, so you resort to name calling.

[@thomasd2444]

0:00:00 - No Transcript. Oh Noooooo Mr. Billllllllll ! 0:03:34 - One idea: Fed Bonds = Monetary policy / Treasury Bonds = Borrowing = Fiscal policy 0:04:13 - C-Bank Branch & Treasury Branch . . . affect Private sector identically 0:04:45 - Pamphlet SOFT CURRENCY ECONOMICS

[@gg_rider]

Modern Money is modern in the sense that we say agriculture was created by "modern man", after hunter-gatherer man. @1:31:00 discussion of taxes and why taxing WORK is very bad. Besides serious unfairness, it directly cuts into consumer spending power at the bottom, where people spend 100% of their take-home or more. Therefore, it directly cuts into GDP. Yet at higher income levels and capital gains where there is much more unspent income (savings), the payroll tax stops and disappears. So that tax is a massive unnecessary drag on the economy. Taxing work, disincentivizes or devalues work. But we want people to work. Payroll tax taxes employers, but we want people to employ workers, not disincentivize hiring. Why taxing corporations is a bad idea. (explained) Tax "bads" instead of taxing "goods".

[@Rob-fx2dw]

dilbertgeg - you are right - taxing work is a big disincetive to work. How many times have I heard "it's a waste working any longer because you just pay way too much tax and get virtually nothing out of it." or words like that.

[@gg_rider]

Rob Mews which is why Wray and Mosler etc want to untax labor, esp Payroll tax. Also, Wray wants to abolish corp tax. I'm sure stop general retail sales tax too, tho that's state level. If general consumers get TOO rich, then impose some tax increases to slow down. All to make capitalism more user-friendly. I say, we're all stuck at a poker table, playing against high stakes experts, never asked if we wanted to play, can't leave, seldom win a hand. Casino Capitalism.

[@Rob-fx2dw]

dilberteg. That reduction in tax may be so but his MMT system is so faulted on so many aspects that it will fail for other reasons. That includes it's lack of understanding of inflationary causes, it's lack of consideration of the power to expand the currency which it places more in the hands of politicians who we know act in their own interests rather than the community's interest and the lack of and misinterpretation of the details that need to be understood and taken into account before it is applied. Pesently the theory fails to address many existing details and glosses over others.

[@Herbwise]

@@Rob-fx2dw It has been in place for years. Only the language about it has not caught up.

[@Rob-fx2dw]

@@Herbwise It has not been in place because it is a false description of the money situation. Parts of it have been and those parts are the reason for failures in the economy particularly the recent inflation which started well before the war in Ukraine. You need to examine the correct description of how money is created rather than this mathematically inept self promoting group of so called economists who put across a misleading wrong description of how money is created and gets it's value and how inflation occurs. Their description of the process even contradict the explanations of the very institutions who create money like for instance the bank of England and the bank of Canada who have posted their explanation online.

[@clarestucki5151]

Govt debt is only creating private sector savings so long as the gov't is borrowing from the private sector. Now, 5 yrs later (2021), the debt is being financed by new Fed Res Bank money created out of thin air. That is simply a tax on savings, and will inevitably lead to price inflation, thw way monetary inflation inevitably must. Law of economics, Econ 101.

[@Alaplaya9]

Damn, I have never heard of this "law of economics". Is that in the textbook?

[@stevenhail2837]

Joe. Your self confidence is only matched by your lack of understanding. When you pay your taxes using private bank money, the reserves of that private bank at the central bank are debited by the same amount. These reserves are government money - created by the central government and/or central bank. They only exist because of government net spending, or central bank lending to commercial banks.

[@joebhed1]

Interesting. So, the connection between privately-issued central bank / interbank reserves and our sovereign government lies where? esp. from the perspective of the sovereign's money powers. Please don't drag us through 'functional finance'. Thanks.

[@joebhed1]

And my confidence comes from being a money system student for 40+ years, having the benefit of my Father's learning of the monetary understandings of dr. Frederick Soddy, whom we are about to discover here. And MMT will be in the dust.

[@Jeevanm71]

I think more time needs to be spent explaining why this doesn't cause inflation

[@MrKongatthegates]

In a depression, you have deflation . caused by a deflating bubble. Printing money in these times ofsets the deflation. Otherwise is does indeed dilute the purchacing power of a dollar. Only to be employed in times of high and rising unemployment. (And deflation/disinflation)

[@thomasd2444]

See Japan's rate of inflation

[@cdub9510]

If resources are available in the denominated currency, then inflation won't happen without market manipulation

[@kathyheyne3489]

Unbelievable! I've watched two lectures by Bill Mitchell tonight and now one by L.Randall Wray and on each lecture I've come across comments by one Rob Mews attacking the lecturers. I can't say he's attacking MMT because he's full of opinions but short on facts. On this lecture, this Rob Mews has commented FIFTEEN times! I didn't count the comments on the Bill Mitchell lectures but there were a lot of them and each comment was the length of an essay. So. You don't agree with MMT, Rob Mews. Fine. STOP WATCHING THE LECTURES.

[@joebhed1]

But, is it not OK to criticize MMT ? Or is there a guiding tenet that says, "Understand, or leave, (stupid)"? I can only see the criticism as of MMT and not the lecturers who are simply doing their best to explain. Because, this is a serious subject that needs discussing. And to me should never be moved to behind any type of curtain.

[@Rob-fx2dw]

Kathy Heyne :-- What is your role here? Are you Just another attempt to silence critics - Just a tactic to avoid facing the fallacies and misinformation that abounds in the MMT ?? Can you answer some of or any of the questions that I have put about the failings of MMT ? I think that's a big NO. What about the sovereign currency 'issuer' who is not just the issuer but the First sovereign currency USER of the currency when the governemnt sells the currency and takes goods and services from he private sector. Government First Currency User !! Not an issuer but a commercial transaction financed by fiat money with the private sector. One of the First fatal errors of Randal Wray's argument but by far Not the last. But MMT wants to ignore that reality. . Just another attempt to silence critics - Just a tactic to avoid facing the fallacies and misinformation that abounds in the MMT. You want to have a video but you don't want any one to find the many incorrect beliefs contradictions and false statements and other problems that render the whole theory as rubbish. -

[@seanoleary2348]

You just said they were the issuer ("who is not just the issuer but the First sovereign currency USER"), and then you said that they weren't the issuer (because they use the money they issue I guess? sounds like a strawman argument). Are you trying to say that they can't issue AND use currency? BTW, it shouldn't JUST be the government that profits from the private sector. The government should represent the population as a whole, which I honestly do not see happening enough. Do you? Or should we bail out some more billionaires?

[@Rob-fx2dw]

Sean O'Leary - Central governments are involved in creating new currency in their economies depending on whether other organisations are involved like the US Federal Reserve or not.. There are minor differences in the details of how that happens depending on the country's arrangements. If you see what I said it was in italics - giving that word emphasis. To clarify what said I will spell it out differently. MMT says the government 'issues' new fiat money to the private sector and they "provide" new fiat money to the private sector. Both descriptions are short of the truth since because a transaction takes place in exchange for things the private sector must make by working to have any entry of new fiat money into the economy or the private sector. It is short of the reality since they don't' issue' it but they buy things with it be that services or goods. The central government is the first user of that new money. There is no strawman argument since someone issuing or providing something is far different from using it for their own gain to obtain something which they could not otherwise have had. You are right in expecting that government should be acting in the interest of the population as a whole not just some organisations who have overspent and continued to do so and expected bailouts. The problem is central governments have got so much power that they do what is good for their personal politics not what is good for the community. In short they have too much power.

[@seanoleary2348]

The idea of issuing vs buying is that issuing means you can create a virtually unlimited amount of spending money. Obviously this can effect inflation, but there is no limit to the amount that the government can ISSUE. And obviously the government can't just issue money and line their own pockets with it, because that would be ILLEGAL. So that's when we use the word "issue" vs the word "buy." You can only buy something with a limited amount of money. You can issue an unlimited supply. And the reason why it is not merely for the central government's "own gain" is because they are beholden to the people who have voted them into office. So if they want to keep their jobs, they had better get with the bigger picture. Just like if we want to offset inflation, we ALL need to get with the bigger picture and pay our fair share of taxes (not to mention the IRS will come knocking). The problem is that the central government is now being influenced by the private sector, which influences where the money goes. The central government is not SUPPOSED to be personally profiting off of where they issue the money, so as it stands, there is a revolving doorway between the private sector and our government, which you might trace all the way back to when big advertising firms started getting involved with politics. What we need now is public funded elections, and a bold separation between the private sector and the government so that the government is not influenced by big-money. We need to lock that revolving door. Obviously we need to keep the election process democratic at the same time and audit our government officials, so that we can vote people out if they direct government spending towards selfish means while in office and so that we can slap them with the right kinds of penalties for doing so. This is not an act of aggression against the private sector if this is done, because people still get their jobs from the private sector, and so the government still has incentive to keep an appropriate amount of money funding them (because people get angry when they are put out of work and will vote their representatives out of office, not to mention that whole systems are funded by banking institutions and loans and whatnot).

[@thomasd2444]

1:43:54 - 40% of the $29 TRILLION went to Europe 1:43:58 - Is China going to issue that much in loans as the lender of last resort? 1:44:05 - Britain did. Now USA does. 1:44:10 - Because our Federal Reserve Board is willing & able to be the lender of last resort

[@Rob-fx2dw]

From 17:25 onwards Wray talks about reaosons why one accepts a currency. He fails to say (why) that people only accept a currency because it buys goods and services with that currency. As soon as it doesn't there is nobody who will want it and nobody who will accept it , Not even the government which printed it into existence. If you argue against that then you must argue that governments which have replaced their currencies with others will still acept the original as payment. They won't.

[@Rob-fx2dw]

Misleading again: Wray says " you can't pay your dollar tax unless the governemnt has provided some dollars" But that is misleading since the governemnt trades those dollars for goods and services and does not "provide them". Important ? yes since he later states the governemnt must "spend" those dollars. Not so since they could just provide them. It's a deiberate change of phrase to to confuse despite the fact he motle likely aware of this since it has already been pointed out . .

[@jb4127]

If the US government is taxing you in dollars, you wouldn't be able to pay that tax unless you had dollars. And you wouldn't have dollars unless you have them in your possession, which you could only have because the US government issued/provided those dollars in the economy.

[@Rob-fx2dw]

The cup of sugar example (13:25 on). Not an accurate analogy at all since the IOU is what you need back to retain your credibility. Also to retain the risk of default (on value) that your lender attributes to the willingness to lend you that sugar. Excesive notes will decrease his willingness to lend you anything at all.

[@joebhed1]

MMT "Conclusions" "The first is ....... Sovereign governments ...... issue their own currency ..... and this makes a big difference."" Well, it WOULD make a big difference if ANY sovereign government issued its own currency (money), but early on, Wray identified the underpinnings of MMT as based fully on the Bankers' Money School - which is a money system model based on the private bankers issuing national monies. So, we have NO GOVERNMENT that issues its own money. What else do you conclude?

[@thomasd2444]

I conclude you did not listen Congress buys an aircraft carrier and credits the boat builder's bank account & issue goes the currency into circulation

[@joebhed1]

@@thomasd2444 Yeah, that's a good one. Cogress credits the boat-builder's account. Nice work if you can get it. Always a wrinkle in the MMT argument. Separation of Powers. It's not Congress that HAS the power to CREDIT the account of the boat builder. It's Treasury. And, unlike some MMT wild-assed-notions around, Treasury actually needs to get money into its account in order to spend it. Do I need their financial report to prove that ? So. Back to you.

[@joebhed1]

@@thomasd2444 1. Congress does NOT buy aircraft carriers, Treasury does, per "authorization" from the Defense Dept. approved Budget. Congress buys nothing under the Separation of Powers construct. 2. Treasury does not, and can not, purchase a carrier, or a box of nails, unless it has the "money" in its account at the Fed, which "money" and not currency, must come from taxation and borrowing. Let me know if you need the audited financial statement of the government. 3.There exists in the world only the tiniest, infinitesimal fraction of "currency" - do you know what currency means(?) - needed to buy a carrier, and Congress is not in control of any of our currency. Who told you that? So, poof, Thomas. You got nothing. Please feel free to challenge any word I've written. Thanks..

[@thomasd2444]

1:26:47 - First book draft 1:27:30 - Money scares economists 1:27:40 - First reaction ought to be relief; we can afford full employment but instead 1:27:56 - Fear representatives will spend

[@Rob-fx2dw]

Did I say that Wray states that government needs taxes to raise money? I think I said the opposite. Creating an artificial demand for it is not wealth producing. It is another form of tax and tax is by operation just wealth transfer. When sovereign government Spends (not prides and not issues) new money to get goods / services that people have had to worked to make it is taxing not creating wealth. More tax means more work people have had to do not get a choice to spend on their needs.

[@jb4127]

I feel like tax is more something a government uses to implement policies and create incentives. Basically it's just a tool for engineering/controlling a country.

[@antontzenev9707]

Wray explains MMT in a so simple and brilliant manner, that even average brainwashed Americans can comprehend. And MMT is mathematically simple and 100% correct. However, he is intentionally or unintentionally missing a point, which if added would make a huge difference. As a simple example of 100% mathematical accuracy I can give the mathematical expression of calculating the ballistic trajectory of a missile. Although the mathematics included would perfectly describe the physical movement of the missile, mathematics fail to explain the consequences. Similarly, MMT is simple and explanatory and working great. However, MMT is a method for transferring wealth from a person(s) to another person(s). And it is of course easy for the managing authority (the FED) to manipulate the rates in such a way as to expand and contract monetary reserves and thereafter, when the Treasury issues bonds, the FED directs the newly created liquidity into its shareholders banks (the banks which own the FED). With this newly created liquidity, these privileged banks create new bank instruments which they sell to other banks at profit and also loan new loans at interest. Thus the owners of the FED use the liquidity to create new money and profit. The profit is then circulated into specially created entities, mostly registered on off shore locations, where they are transferred into off shore trusts (so that the trail is hopelessly lost) and ultimately transferred into fiduciary acco,unts of a few European families. That is how the USA is being robbed and how the whole world is being robbed - through wealth transfer based on MMT. So, the math equations which perfectly explain the ballistics of a launched missile, do not explain the consequences of the explosion of this missile - the thousands of lives lost and thousands crippled - much as the MMT perfectly explained by Wray, does not uncover the implications of the wealth transfer, which is why MMT was created in the first place!!!

[@brodyalden]

Subtle point.

[@buckeye200175]

U S is a corporation , not a sovereign nation , therefore has to borrow its ...money , hence the national debt ...of the corporation of which , we the people belong to , they own your title your birth certificate is collateral for your and their ...debt

[@cdub9510]

Nope....not even close. Article 1 Sec 8 and subsequent laws gives Congress the power to spend by law.

[@muhammadm4582]

Nicolas Maduro: “I’ve tried this shit”

[@Rob-fx2dw]

(At 1.01 onward ) Was Wray born yesterday ? He must have been if he needs Ruml to point out that government doesn't need tax to raise revenue for government spending. Of course not and neither does a counterfeiter. But to not tax and heavily deficit budget to pay for spending means lack of the financial accountability which negates the stable currency which any economy needs for optimum growth. That's why government insists that ALL other organisations can't deficit budget !!

[@memeoverlord-pz5ns]

This all sounds so well, until he starts talking about reducing taxes for corporations.

[@bobby33x97]

Why are so many Jews pushing MMT???

[@buckeye200175]

Soft currency is debt not money ...hard currency , gold and silver is hard currency , money backed by hard assets , something real and valued , like the U S military that makes our currency appear to be a hard asset ....but it is still just ...debt

[@Rob-fx2dw]

Wrong assumption about wages and floating a currency. There is no need that makes a country running a trade surplus keep some sort of austerity policy. He omits (maybe reveals ignorance of) the critical factors which determine the wealth countries. You do not have to keep wages low, you do not have to keep domestic aggregate demand low so the population will not buy imports. That may be what Wray beliefs but among other beliefs he is wrong on this. Wray says that China will become a

[@mrzack888]

ruling elites don't want a full employment jobs program because it would compete for workers. workers would not be willing to slave for slave wages doing something they dont like. Workers would rather take lower pay at a govt works program doing something they are good at and to train their skills.

[@ricklarsen7477]

Dang, this guy thinks like a libertarian when it comes to taxes but not like a libertarian when it comes to monetary policy.

[@Rob-fx2dw]

L Randal Wray is misleading people again. - He makes the assumption that if you want to buy something that it is the obligation to pay tax that drives the nescessity of having the currency. That is clearly not the case. The fact is that your limited ability to acquire the currency and the limited ability to acquire the goods and services is the motivatiing factor in accepting any currency as payment for your services. Wray leaves the exchange factor of goods and services out. Why?

[@jb4127]

Saying if you are being taxed in Euro's you must pay in Euro's is not misleading. Or just do a experiment - try to pay a US government tax in euro's and see what happens :)

[@seandonovan4186]

This is an economic "theory" that fails to incorporate the glaringly large parts of an economy: Production and real capital. as well as other drivers. The focus on taxes as being a driver is like focusing on the sensors of the auto rather than the engine. Taxes are not the largest driver of demand for dollars simply because they are only a smaller percentage of what is generated even long term! The combustion of the fuel and power of the system is not mentioned. Merely sensor talk.

[@cdub9510]

Five thousand years of written history proves the theory is sound and correct. That you don't understand it is the real problem

[@communistfun]

Well here's an alternative to always playing capitalism. I think MMT has a lot of good points but why not simply replace all the capitalist businesses with worker cooperatives and make the banking public?

[@joebhed1]

"Permit to issue the nation's money, and I care not who makes its laws." Brer Rothschild Banker And, thus, it has come to pass. All power is to the issuer, and not the borrower. Yes even worker cooperative and public banking laws do not matter. Private Bank Money Issuers WIN. That's all there is to it. Change that, or change nothing.

[@itube0047]

Because it wouldn't work, you idiot.

[@huehuecoyotl2]

Because that isn't simple to do politically or economically and isn't necessarily a great across the board thing to do. Better to let those things develop voluntarily and organically on a local level. If they work, and I think they can, they will thrive of their own accord.

[@cdub9510]

How could the oligarchy remain in power that way? Don't be silly

[@Rob-fx2dw]

The governent almost always runs a deficit . Why ? because they are bailed out by the private sector when they run a deficit. When the private sector run a deficit continually or over time they go out of business through being bankrupt. Wray says that deficits are bad for the private sector but doesn't seem to be able to put the two together as to why government can run a deficit and private cannot continue to do so. The reason that government can is government monetary expansion.

[@cdub9510]

The private sector cannot issue currency...that's counterfeiting and illegal

[@soulfuzz368]

“If I keep filling this ballon up slow enough, it will never pop.”

[@Rob-fx2dw]

Yes again at 51:30 on) - Wray says that money is debt and the issuer must take it back. So what does governmet do ? 'Issues" debt and takes back tax. The so called "issuing" that Wray talks about is Not issuing as we know it. In reality it is Spending to take goods and services. Government does Not just "Issue" money at all. If Wray's version of issuing reallly was so then people would get back goods and services directly when they 'issued' their tax to government. They don't.

[@Rob-fx2dw]

At 51.00 - "all money is debt" . So how is the government that creates more debt to fund their deficits actually going to pay for anything or fund anything out of creating more debt ? That is a real problem for everyone since government debt is created by selling treasury bonds and the government debt has to be paid for by the people in the private sector since government itself never pays he interest on that debt (e.g treasury bond interest and never can fund the payout on maturity of the debt (treasury bonds) but is forced to do it by paying with tax money. The answer is the government can't fund anything with the debt they create. It can only force people to pay for more debt by doing more work to earn more and pay more tax. So when Kelton (who is one of the other MMT team and part of the group that is pushing the so called theory) says "we can all have nice things" with MMT she is really saying is you can all have more debt. Just what nobody wants. It is fairly apparent that Randal Wray does Not know how to follow a money trail or follow the whole life of government debt but looks only at the initial part of funding government expenditure and ignoring what happens to the bonds that fund it when he makes statements like he does about debt. He in effect ignores or denies the reality of government debt.

[@MichaelHabner]

Totally agree. Money as defined by MMT is actually credit. Of the lowest quality imaginable. Money extinguishes debt, credit cannot extinguish itself.

[@Rob-fx2dw]

@@MichaelHabner I am happy you understand that and have replied. You are so far ahead of the MMTers and many others in understanding what is to me a straight forward financial concept that enables you to see through the messy confused thinking that backs MMT's belief about the nature of fiat money.

[@luckylui3282]

True. It appears they convolute the notion of the gov issuing a sovereign currency with how things actually work. No?

[@MichaelHabner]

Jusy saw these responses now. Its incorrect of fact to say that all money is debt. Even Ben Bernanke admits that gold is an asset. It has no counterparty liability, it is not debt. For that reason, it is debt free money. This is where MMT is blatantly and dangerously wrong imo. Money is not exclusively debt.

[@Rob-fx2dw]

@@luckylui3282 They confuse one thing with another more often than most.

[@joebhed1]

Not to repeat myself.. As to commercial bank account balances at the Fed, So what? Who cares? Not me. Not the Treasury. Not the Restofus. “”These reserves are government money - created by the central government and/or central bank.”” CB reserves are not government money. They are NEVER created by the government. They NEVER show up on the Treasury’s financials and have zero effect on Treasury operations. Ever. They are not affected by government spending any more than by my spending. Thanks

[@daveroy1066]

Thought provoking,witch is good. I would say that this seems to be not so much a theory but a clearer view of the current system and the highlighting of the possible tweaks we could do to great effect. However, there are many problems with this system as a whole and the current situation society finds itself.He mentioned Soro's taking down Britian and dynasty families. An inheritance tax would not have prevented Soros as he accumulated that in his lifetime. Bill Gates is said to be worth 90 billion (2016). Weather you think he is good or not, our system is clearly unjust and broken. He was driven like all others of history and the future, by an idea,curiosity and confidence. This gross misrepresentation of entitlement/reward is powerfully destabilizing. He is worth more than whole nations. Power of this magnitude in one man or small clique is not good for society. _I have no private interest in the reception of my inventions by the world, having never made, nor proposed to make, the least profit by any of them._ Benjamin Franklin A medium of exchange is a tool needed in society. An understanding of its primary function as well as its other possible function(s) and or hazards is a good place to start a "New Theory of Money". Seems to me that only that witch is valued and desired by another is considered wealth worthy of allowing you to gain your sustenance. For most that would be there "job"and property. Jobs are becoming fewer. A fundamental look at the idea of society and what constitutes wealth worthy of earning the basic necessities of life needs to be discussed. If I learn the piano, I have improved myself. Even if I don't rise to the level of skill that anyone would want to listen, I have still improved myself. Self improvement by people the world over would make this world better. Our society is just as it was back in history with chrome and some bells and whistles. We now have the understanding capable of inventing our future. Not merely tweaking what was handed down to us but creating our own idea of what society we want and what we will need to get there. It won't be Utopia as ego, evil and selfishness will always be with us but dam....we are capable of so much more.

[@bethanyhunt2704]

Higher wealth tax, property tax, capital gains tax would address the inequality. As would democratic ownership and control of businesses!

[@daveroy1066]

Bethany Hunt If only it were that simple.

[@Rob-fx2dw]

Now at 18:06 Wray jumps from his previous assertion that government needs to "Provide" the dollars so people can pay tax to his new assertion that governemnt needs to "Spend" . To him "Provide" and "Spend" are the same thing. Yet that is clearly not so . The definition of "spend" - Yet he pesrists with "the government needs to "spend" before you can pay your taxes. - Totally twisted logic from an initial explanation based on substituion of words from "Provide" to "Spend".

[@Rob-fx2dw]

Now Wray hides behind the legal definition of bankruptcy and insolvency. What happens in excess government money expansion is government's failure to be able to pay bills in foreign currency when their sovereign currency becomes so worthless that nobody else wants it and the exchange rate is so adverse that foreign investers will not invest. That is the danger, not some technical insolvency term he uses. That happened in Germany and Zimbabwe. The people (not the politicians) suffered.

[@Rob-fx2dw]

At 16:40 onward Wray makes the case that taxes 'drive the currency' in order to create a demand for the currency. Totally wrong logic. It cannot be so since higher taxes would drive more demand for the currency and this is not the case for the very reason that a little thinking would tell anyone that a firstly a tax approaching 100% would make the currency almost infinitely more valuable. The evidence is tat governments with a higher proportion of tax do not have higher valued currencies as a result of increased demand imposed by those higher taxes. Not only that Wray also fails to take into account the thinking and policy of his fellow MMT advocates including one of the founders he has mentioned - Warren Mosler- who a states that a sovereign currency issuing government does not need to tax. So by Wray's logic which opposes Mosler's logic about taxes 'driving the demand' for that currency the thinking behind the MMT theory is shown to be confused, contradictory and therefore suitable for the garbage bin. He aslo tries to back away from what he says by the qualification - "They may not be a necessary condition" and "you may be able to come up with another explanation ". and " I haven't heard any " . Where has this guy been hiding - What world ?? How ridiculous that an economist has not heard of any reason you might need a currency like needing another currency (not taxed in the USA so by his logic worthless in the USA) to pay for some goods you bought from another country or like needing somewhere to invest some savings instead of in land, housing or shares to have a part of owning or legally controlling a company. Those shares are Not a taxed commodity that you pay but are so often traded to get something other than money, something like control over another business. There are a thousand reasons why a currency has value yet he has not thought of or heard of one despite such crypto currencies like Bitcoin or currencies like gold or silver or even tea or cotton which have been used as currency.

[@bluecamus5162]

No, your logic is flawed. You contradicted yourself by saying that Wray contradicts Mosler, but then you follow that with Wray saying " they may not be a necessary condition" meaning that Wray didn't contradict Mosler after all, but you threw out the entire MMT story based on your flawed argument. --- Now I kinda' see how one would get confused over what he said about reasons for demanding a currency, but what I took that to mean, when I took it in context, which you did not, is that Wray couldn't think of any other thing that would drive the currency the way taxes do. How or why would you demand a dollar or any currency enough to drive it other than through taxes. He didn't know of one.

[@Rob-fx2dw]

David Smith - There is no rational logic in a belief that taxes drive currencies. It may see to someone who has some irrational belief that taxes drive currencies or drive value into currencies make a currency worth more in terms of value but it is all based on unreasoned logic. The reality is it cannot be so just as moving currency from one pocket to another makes it worth more. The failure of that logic can be explained by the philosophical reality that any axiom cannot prove itself to be true. Therefore something cannot make itself worth more . To make it more then there must be an action that attaches it to something else not just a change of ownership. For instance if I own something that can be exchanged for a kilo of silver then that is it's price and that does not change if someone else own the silver - It still has an exchange value ( price ) that is the same. You must be able to understand that if taxes drove a currency then higher taxes would drive it higher. That has historically been proven wrong.

[@james13r15]

You are wrong Rob. 1) He does not contradict himself. It is true that the government does not need taxation to pay for government spending, HOWEVER, it does need taxation to control inflation. Therefore, it is entirely logical for Wray to suggest that the value of the currency is ensured by the government accepting it for the payment of taxes. This is what makes it legal tender and why people are willing to exchange it between themselves for goods and services. 2) You argue: 'You might need... another currency to pay for some goods... from another country'. You might, and therefore the value of this currency to you would be that you can exchange it for a foreign good or service. But what gives it value to the individual you have purchased it from in this foreign country? The fact they can pay their taxes in this currency and be accepted by their domestic government. This is what secures its underlying value. 3) With regards to your comparison to Gold, Silver, Tea, Cotton - these are commodities. Currency is not; if it was not required for paying taxes it would have no value. (If you are wondering how exchange rate determination works under MMT I can help to explain that too.) After making these 3 points, and for clarity, here is a simple example: The exchange of goods and services using a currency is underpinned by trust, as a 1$ bill passes hands from one person to the next through transactions each individual trusts that it is worth 1$. Who ensures and determines that it is worth 1$? The government, because the individual who has the 1$ at the end of the year, knows he can pay the 20% tax (20 cents) using this currency. And cryptocurrency - it will collapse. What gives cryptocurrency value is that it can be used for illicit activity (drug dealing, money laundering, etc) as it is anonymous and untraceable. The decentralisation is an interesting prospect, but the currencies will fail once governments regulate its use.

[@cdub9510]

Taxes cause unemployment.

[@lowersaxon]

Nonsense.

[@Rob-fx2dw]

Again at 18 15 "you can't pay your taxes unless you have the dollars" - He has the cart before the horse. The reality is you don't have any taxes before you have earned the dollars which you work for. He has a jumbled confused understanding of the timeline of what happens. Like saying you cannot pay your taxes so you have to work for money when the Reality in proper sequence is you have to work for the money before you actually get paid. Until then you have No tax liability !! But the sequencing of what MMT preached is all jumbled up throughout as if no time line or sequencing actually exists.

[@kathleensmith2184]

Why does this guy say things that the US government issues the money -- IT DOESNT. US cental bank called the Federal Reserve is actually not part of the government -- it is a private bank that makes money out of nothing and lends it to the US government, which the US populatin has to pay interest on -- since the interest doesn't exist int the money supply that is borrowed it has to endless increase, this is why our monetary system is really just one big PONZI scheme. . It is the biggest con and criminal fraud ever -- Bank of England and all the other central banks around the world do this and they all collude together.

[@nthperson]

Your observation is extremely important. My own comment above raises the same issue. The definite I use of a Federal Reserve Note is "a promise to pay nothing in particular." The model of banking that needs to be re-examined is how the Bank of Amsterdam operated as a deposit bank issuing "receipt money" that circulated throughout the global economy. Importantly, the Bank of Amsterdam was not authorized to act as a lending institution, although it did earn revenue from the services it performed, and this revenue they could invest or make available as loans.

[@zackidoozacoou3164]

What u must understand is that the government gave the fed that privileged by law under the circumstances of that era. As a lawyer once told me... What good is a law if society is never allowed to change it. Fiat money is the most wonderful invention ever made by man. Human are so close to living in a Utopia. Even if the word Utopia has a bad PR.

[@TTalkWithTaylor]

They're allowing the Central Bank to create the money and distribute it. They're still the one with the power. They still give the Central Bank the authority. Our Federal Government has simply legislated it out...nothing that couldn't be undone tomorrow - there just isn't a need for it.The US doesn't pay interest. It creates currency.

[@Jeevanm71]

With modern monetary theory, we need to abandon the private nature of the federal reserve

[@billcarson185]

I could only stand 42 minutes of this BS. Here's why: 1) Having the Fed “print and loan” money to the Treasury should not be considered in the same desirable light as citizens working for their money and then saving it because private savings are invested more productively into the economy than is politicized federal spending. 2) Printing money is not benign because it eventually devalues our currency, and that dis-incentivizes private savings and their careful investments. 3) MMT promoters are con-men promoting a pyramid scheme. Correction, it WORSE that that because at least pyramid schemes victims had a choice. With MMT, those who get in early, AKA: this generation, get “free” money for lavish federal funded goodies. Our decedents who follow get left exponentially growing interest payments on the debt followed by a loss of confidence in currency resulting in Venezuelan style economic and social collapse of civilization. 4) This sh~t’s evil!

[@Rob-fx2dw]

You are right - It's sh..t and evil and insulting to anyone with an ounce of financial ability. They not only claim they know how the present system works which they have a gross misunderstanding of they but can't even answer as to why their theory claims tax collections are destroyed and not used as revenue to spend in the federal busget. Of course this claim is utterly false since there never could be a federal busget surplus if that were the case but defying historical fact is only a part of MMT (Much Muddled Theory) .

[@bobby33x97]

Wray is a super-slick Snake-Oil Salesman because MMT is Snake Oil!

[@cdub9510]

Yeah five thousand years of written historical records are snake oil....?? Jfc

[@isaiahberlin37]

If you have a valid criticism, make it, add to the discussion not to the divisiveness.

[@Rob-fx2dw]

So again Wray is wrong. He uses as a reason that taxes drive a demand for a currency is also incorrect in that the US dollar is used as a currency in other countries alongside their own with No tax obligation for anyone to pay. So tax obligation is not in the mind of either trading party at all. Also it is used as an intermediary as the world reserve in freight contracts for the same reason without any tax obligation at all in the minds of it's users since there is no hint of tax involved.

[@Eric1424Dahlen]

This is very sad. Dollars do not come from government spending. They get loaned out to banks through the Federal Reserve System. This man completely ignores that fact. Inflation and deflation are controlled by the federal tax rate. Very very sad.

[@johnellington1932]

Tentacle Monopolitic Insecurity Gains. Center of Inequality. If Know Why So Much Debt. Insanity Economics. Where is Georgia? Little White House.

[@Evaluator3]

Professor Wray needs to do some more research. He is wrong to say the US is the only country with a debt limit. There are several other countries that have government debt limits for example: Denmark,Malaysia,Kenya,Poland,Pakistan,Namibia,....etc...etc.. MMT is a flawed economic program that makes Keynes' theories seem like a conservative. MMT destroys the element of work and saving incentive and removes any credibility to a countries currency and will be the foundational building blocks for hyperinflation. The attitude of who cares about debt we can just print more is a fallacy....Go ask the Germans of Weirmar Germany how MMT philosophy worked out....IT DESTROYED THE COUNTRY AND GAVE RISE TO HITLER!!! Real money creates stable economies and controls inflation....fiat currencies will ALWAYS revert to their true values...............ZERO. MMT is the final act of an empire in decline. Read 'Fate of Empire' by John Glubb (1976) because you need to!

[@Rob-fx2dw]

You are absolutely right and Randal Wray is peddling a false and dangerously wrong understanding of economics. He an his MMT pushers are snake oil salesmen. Fiat money is debt because it is not the result of producing anything. ( hat's why it is the exclusive monopoly of the Federal reserve and government) It just provides the first recipient (government) a monopoly derived ability to spend money to acquire real goods or services in competition with existing buyers in the private sector.

[@Rob-fx2dw]

Wray again contradicts himself. His argument - "the government needs to spend before you can pay your taxes". He is keen to introduce the timeliness factor into his argument - "the government must first sepnd". But the real problem with that is the currency government initially spends is worthless by his earlier argument that it has not been taxed and is not liable for tax at that time and cannot be so since government does not need to tax itself and does not when it is first spent or any time after. One has to ask why is this original money worth anything since there is by his own argument, which involves the timeliness of government spending before anyone else can use it. The currency when first spent has no demand for it that is driven by tax which is the moot point. He has defeated his own first argument by his second argument and boxed himself into a corner from which he has no way to escape from since it is false logic. .

[@bluecamus5162]

You want to be so big on logic, yet yours is so fucked up. You need to take everything in context, yet you want to isolate one thing, erect a strawman and then obfuscate the theory on that strawman. Your logic is only obfuscation, just cloud the issue enough and someone will believe you? The rest of us seem to understand perfectly well what he means, only you have the problem.

[@Rob-fx2dw]

David Smith - You only believe that because you have put aside critical examination of the facts and believed what someone has told you just like someone does in any story where the reader accepts what is said with either no intention of questioning it or no knowledge of what the alternative true facts are or may be. So that approach leads to you being led by the person to whom you have surrendered your mind. The context in which you take what Wray says to be true is that of flatly believing what he says. Flatly accepting what his theory is without examining it deeply and seeing it's faults which are many.

[@james13r15]

You are wrong Rob. 1) He does not contradict himself. It is true that the government does not need taxation to pay for government spending, HOWEVER, it does need taxation to control inflation. Therefore, it is entirely logical for Wray to suggest that the value of the currency is ensured by the government accepting it for the payment of taxes. This is what makes it legal tender and why people are willing to exchange it between themselves for goods and services. 2) You argue: 'You might need... another currency to pay for some goods... from another country'. You might, and therefore the value of this currency to you would be that you can exchange it for a foreign good or service. But what gives it value to the individual you have purchased it from in this foreign country? The fact they can pay their taxes in this currency and be accepted by their domestic government. This is what secures its underlying value. 3) With regards to your comparison to Gold, Silver, Tea, Cotton - these are commodities. Currency is not; if it was not required for paying taxes it would have no value. (If you are wondering how exchange rate determination works under MMT I can help to explain that too.) After making these 3 points, and for clarity, here is a simple example: The exchange of goods and services using a currency is underpinned by trust, as a 1$ bill passes hands from one person to the next through transactions each individual trusts that it is worth 1$. Who ensures and determines that it is worth 1$? The government, because the individual who has the 1$ at the end of the year, knows he can pay the 20% tax (20 cents) using this currency. And cryptocurrency - it will collapse. What gives cryptocurrency value is that it can be used for illicit activity (drug dealing, money laundering, etc) as it is anonymous and untraceable. The decentralisation is an interesting prospect, but the currencies will fail once governments regulate its use.

[@richardmillar2412]

The order of events may be ascertained to take place at the Fed & Treasury; but in this region it is complicated by the occurrence of nodes and internodes, growth in length being confined to the latter, many of which may be growing simultaneously on the balance sheet.

[@drakekoefoed1642]

Rob, suppose nobody had your currency yet. You cannot tax in it. You cannot collect tax in floofads until the government issues some floofads by spending some

[@talkingcloud740]

If the government can and should take up the slack from an economy in which tech robotisation & AI software is replacing & preferred to human waged labour in buying the "burgeoning unemployed" surely this should be in the form of an adequate basic income that would allow for costs of new skills training and where applicable - mandated work in the environmental sector such as brown field recovery, wild places management, roadside gardens? etc. (all manner of necessarily yet not easily privatised for profit work) this would not cause any drain on tax, and if it will then clearly a new system is required. (there being no taxes from waged workers available, or hardly any)

[@fachriranu1041]

Not gonna happen... Every job that lost because of machine there are new job that can only be done by human. Hell after 10-15 year of promised driverless car, we still need some kind of driver in the newest type.

[@bobby33x97]

Why are so many Jews pushing MMT???