Unpacking Modern Monetary Theory w/ Warren Mosler

How does one of the leading voices of Modern Monetary Theory think about the macro environment today?
Warren Mosler, president of Valance Company and the economist considered the father of Modern Monetary Theory (MMT), joins Maggie Lake to discuss what MMT is, how it relates to inflation, and the ramifications of current Fed policy.
CHAPTERS:
1 The MMT Framework and How It's Talked About Now 00:31
2 What Are We Getting Wrong About the Relationship Between Policy and Inflation? 0:12:59
3 Do the Fed Rate Hikes Actually Have a Stimulatory Effect? 0:24:09
4 What Causes Recessions If It's Not Hiking Rates? 0:34:37
5 Why is MMT so Misunderstood? 0:43:25
6 Viewer Questions 0:51:18
7 Final Thoughts 01:01:50
👉 Do you want even more content like this? And to see this video before we release it here? Become a member of Real Vision -- get started here: rvtv.io/membership
Thanks for watching Real Vision Finance!
# #
About Real Vision™:
Real Vision™ is where you can gain an understanding of the complex world of finance, business, and the global economy with real in-depth analysis from real experts.
🔥 𝗚𝗘𝗧 𝟳 𝗗𝗔𝗬𝗦 of Real Vision’s insights for only $𝟭 (seriously!) rvtv.io/RVfor1dollar
🚀 Want to become a better investor or start from scratch? 👉 Join the Real Investing course now! rvtv.io/RVAcademy
Connect with Real Vision™ Online:
RV Crypto: rvtv.io/RealVisionCrypto
Twitter: rvtv.io/twitter
Instagram: rvtv.io/instagram
Facebook: rvtv.io/facebook
Linkedin: rvtv.io/linkedin​​​​​​​​​​​​​​​​
#Macro #finance #macroeconomy #markets #financialmarkets #bonds #stocks #oil #gas #commodities #equities #gold
Disclaimer:
This is pretty obvious, but we should probably say it anyway so there is no confusion…The material in REAL VISION GROUP video programs and publications {collectively referred to as “RV RELEASES”} is provided for informational purposes only and is NOT investment advice. The information in RV RELEASES has been obtained from sources believed to be reliable, but Real Vision and its contributors, distributors and/or publisher, licensors, and their respective employees, contractors, agents, suppliers, and vendors { collectively, “Affiliated Parties”} make no representation or warranty as to the accuracy, timeliness or completeness of the content in RV RELEASES. Any data included in RV RELEASES are illustrative only and not for investment purposes. Any opinion or recommendation expressed in RV RELEASES is subject to change without notice. RV Releases do not recommend, explicitly nor implicitly, nor suggest or recommend any investment strategy. Real Vision Group and its Affiliated Parties disclaim all liability for any loss that may arise (whether direct indirect, consequential, incidental, punitive, or otherwise) from any use of the information in RV RELEASES. Real Vision Group and its Affiliated Parties do not have regard for any individual, group of individuals, or entity’s specific investment objectives, financial situation, or circumstance. RV RELEASES do not express any opinion on the future value of any security, currency, or other investment instruments. You should seek expert financial and other advice regarding the appropriateness of the material discussed or recommended in RV RELEASES and should note that investment values may fall, you may receive less back than originally invested and past performances are not necessarily reflective of future performances. Well, that was pretty intense! We hope you got all of that - now stop reading the small print and go and enjoy Real Vision.

[@RealVisionFinance]

🔥 𝗚𝗘𝗧 𝟳 𝗗𝗔𝗬𝗦 of Real Vision Premium access & insights for only $𝟭 (seriously!) rvtv.io/RVfor1dollar CHAPTERS: 1 The MMT Framework and How It's Talked About Now 00:31 2 What Are We Getting Wrong About the Relationship Between Policy and Inflation? 0:12:59 3 Do the Fed Rate Hikes Actually Have a Stimulatory Effect? 0:24:09 4 What Causes Recessions If It's Not Hiking Rates? 0:34:37 5 Why is MMT so Misunderstood? 0:43:25 6 Viewer Questions 0:51:18 7 Final Thoughts 01:01:50

[@RuinDweller]

45:50 People have been told that up is down when it comes to government spending for their entire lives. Their parents' knowledge base was also founded on these same fallacies. There was and still is a longstanding precedent of established dogma when it comes to the subject - this dogma is more than casual understanding, it was academic. We've all been raised to believe that the government needs our tax dollars in order to spend. To directly counter it was literally to challenge the idea that water was wet, in the minds of most people. To let go of those comfortable (and more importantly fundamental) ideologies is hard for most people, it requires a HUGE leap of faith. Couple that with a relentless assault on MMT from every angle, by people who either don't understand it, or don't want you to - people that are widely trusted, and it's no wonder people have had MMT mischaracterized for them. When you try to explain how something like that could remain hidden in plain sight for so long, they assume it's "black helicopters", when in reality orthodox econ made a whole lot more sense under the gold standard - it just needs a "modern" adjustment. It's like we got a hardware upgrade, but are still waiting for the software upgrade so that we can actually make the most of it. That's NOT to say there aren't those who intentionally keep MMT knowledge as far away from us as possible because they benefit from our ignorance, but there's a whole lot of useful idiocy going on.

[@user-tw2oe6zi6q]

Warren Mosler is the Best.

[@smoothacceleration437]

Why don't we get the full interview?? Very frustrating.

[@randallstephens1680]

The video is incomplete and cuts off abruptly at the end. Please repair the vide or upload again.

[@nopulpapple991]

The video script discusses Modern Monetary Theory (MMT) and its implications for government spending and monetary policy. Warren Mosler, a proponent of MMT, explains that the government can spend first and then collect taxes, challenging the traditional view of government spending. He also discusses the potential impact of hitting the debt ceiling and the relationship between fiscal and monetary policy. 00:00 Understanding Modern Monetary Theory and the Implications of Government Spending 05:52 Debunking Solvency Concerns and Exploring the Risks of Hitting the Debt Ceiling 11:46 Understanding the Risks of Government Spending and Inflation 17:38 Understanding the Government's Role in Monetary Policy and Inflation 23:33 Understanding Inflation, Debt, and Monetary Policy 29:25 Impact of Deficit Spending and Rate Hikes on the Economy 35:18 The Impact of Interest Rates and Fiscal Policy on the Economy 41:12 Understanding MMT Theory and Its Implications on Monetary Policy 47:06 The Misconception of Redistributing Wealth and Environmental Concerns Crafted by Sider AI.

[@detectiveofmoneypolitics]

Economic investigator Frank G Melbourne Australia is following this content cheers Frank

[@RuinDweller]

"They're drilling holes in the boat to let the water out." - Warren Mosler Couldn't have said it better...

[@MrReconjon]

Can we have Warren debate Jeff Snider?

[@Ggianni10]

What would they be debating?

[@MrReconjon]

@@Ggianni10 how money is created.

[@Ggianni10]

@@MrReconjon I can see them debating the consequences of the printing of (fake) money, but it seems like they would agree on money creation itself. Jeff talks about international printing (or the lack of), and warren talks about domestic printing. They both know "printing" is handwaving.

[@MrReconjon]

@@Ggianni10 yes but they both discuss it in a manner that diminishes the impact of the others belief of the primary source of money. Warren says money originates from the state and Jeff says it originates from the private Eurodollar system. At least that's how I currently understand their positions. Happy to be corrected though.

[@Jesus-kt5dc]

​@@Ggianni10 😂 Fake money? I guess I miss the part where I stop paying my taxes in the government's unit of account, without going to prison and losing my assets. I also miss the part where uncle sam made it illegal to own gold at one point.

[@jimmyolsenblues]

This is a great video.

[@hunglukenguyen]

Full employment just for the sake of full employment is nuts/crazy!

[@richcherwalk6349]

@@hunglukenguyen yes it would shift the balance of power away from capitalists, imagine them actually having to compete for the commodity of labor.

[@yoiyomismo]

Very interesting, thank you!

[@bumandy]

great insight on the debt ceiling. should have used the gdp drop in your video title - would get more views

[@tomcop668]

Kind of an arbitrary finish. Warren is the best.

[@thomasd2444]

End of conversation cuts off

[@stevefitt9538]

To answer that last question [why do MS economists resists MMT so much?] is that 1] MS Econ. helps the rich get richer, and 2] nobody wants to admit they were wrong. MS Economists are stooges who work for the rich, so they deny MMT. MMT wants to have the JGP that will functionally increase the min. wage to close to $25/hr, and will undercut the health insurance industry, by providing healthcare to those with a public JGP job. The rich think this will reduce their incomes.

[@richcherwalk6349]

And by definition it will, in order to be “rich” a lot of other people need to be poor.

[@stevefitt9538]

@@richcherwalk6349 Not necessarily. the incomes of some rich people can increase because the workers have more money to spend, they will spend it, and this will trickle or gush up into the bank accounts of the rich. So, they get less in the short run but can get more in the long run. The MMT Job Guarantee Program will feed new additional money into the economy and this adds to the total of everyone's income, including the rich who always end up with the money in the end.

[@thomasd2444]

CHAPTERS: 0:00:31 - 1 The MMT Framework and How It's Talked About Now 0:12:59 - 2 What Are We Getting Wrong About the Relationship Between Policy and Inflation? 0:24:09 - 3 Do the Fed Rate Hikes Actually Have a Stimulatory Effect? 0:34:37 - 4 What Causes Recessions If It's Not Hiking Rates? 0:43:25 - 5 Why is MMT so Misunderstood? 0:51:18 - 6 Viewer Questions 1:01:50 - 7 Final Thoughts

[@clarestucki5151]

It's true that in the age of fiat money the gov't does not need to collect taxes in order to spend money, but it's also true that if the gov't spends money without collecting taxes (thereby raising the ratio of amount of money in circulation to the amount of goods and services available (GDP), normally defined as 'monetary inflation', that price inflation will be the inevitable result.

[@ryanandre3556]

No, not when more production results. You're only looking at the supply of money, not the supply of labor and goods, and or efficiency of delivering those things.

[@hunglukenguyen]

government will abuse their power, nothing prevents that, MMT is trash in real life (due to government will corrupt)

[@J0HN3]

If this is true, why do we collect taxes at all?

[@thomasd2444]

00:00 - Hit debt ceiling & stop Currency-Issuing-Self-Government paying to pensioners & vendors & creditors 01:31 - Q :

[@J0HN3]

Isn’t a fundamental problem with MMT is that there’s an assumption that all money is created through govt spending? Due to fractional reserve banking, more money is created through the issuance of credit from the banks? Also this doesn’t work if inflation can’t be kept in check. Just modifying the interest rates seems like something that isn’t sufficient.

[@RuinDweller]

33:00 The people involved with the operational side of the FED know, the elected public officials pretty much unilaterally do not.

[@chriskenney4377]

I understand that Real Vision Finance strives to tell the story from many different sides. However, there is always the human transaction side. Manipulation is never conducive to clear vision of the meaning of the transaction. In short, apologists for government action doesn't have any respect for the individual.

[@richiedubs1062]

The problem with the term MMT is the T... it's not a theory. It's how the monetary system functions. The T is a question of philosophy (e.g., maybe it shouldn't work this way, maybe there's a better way, maybe it's the root cause of all of our ills, etc). The term should be MMP: Modern Monetary PRACTICE.

[@ariesbull]

Agree 💯 - well said

[@leightonwatkins9486]

Exactly

[@barryweiss9977]

So the big revelation of MMT or P that is sweeping the nation is the discovery that we work on a fiat currency system? It doesn't explain anything new.

[@brycehoener5610]

If only saying things made them true....

[@leightonwatkins9486]

@@brycehoener5610 saying is not a "thing' its sound

[@dwaindibley4137]

The problem with MMT is that it is so far outside the relm of reality, that it defies debate.

[@richcherwalk6349]

Yea but it is how our system works

[@donkeybus]

​@richcherwalk6349 more like how our system fails to work

[@MengerMania]

Why do these people who preach Modern Monetary Hypothesis never stop to define "money" and what role it plays in individual exchanges.

[@richcherwalk6349]

Money is merely a political system to corral society into producing, money could be anything those in power want it to be. Money has no inherent value it’s just inert

[@nellyx8051]

I'm not sure why he thinks raising rates "juices the economy." Sure you're paying people with money even more money but at the same time you're paying them to not spend that money now. Those tend to be the same people that own stocks and bonds and which fall in value when rates go up so they won't be feeling "juiced" lol.

[@ninefox344]

? It's pretty simple. Now everyone's savings accounts and money market accounts are making 5% when it used to be less than 1%. It's literally free money ("risk free rate"). It's not locked up like a bond. I can spend the interest I'm making right now. If you have a million dollars in a money market account, you're making over 4000 dollars a month for free.

[@nellyx8051]

@@ninefox344 If you're sitting in cash you are loosing nearly all of the interest to inflation. If you're in stocks and bonds you lost 15-20% from when rates started rising. Either way you're not any richer.

[@barryweiss9977]

@@ninefox344 if inflation is higher than 5%, your losing money.

[@Basta11]

Imagine owning stocks at a company. You and a few select people get newly issued stocks every 6 months for doing absolutely nothing. The value of each stock goes down since there is more stock but the equity remains the same. You still had more shares and so still got a bigger percent of the company. The people who didn’t get new share lost value. So high interest rates cause higher deficits which cause inflation for everybody while paying people who bought higher yielding securities. It’s basically tax for everyone to benefit rich people. Yes, people who owned stocks and bonds did lose value in their portfolios. However, so long as they didn’t sell their assets at a loss, they’ll be fine. Unless you sell all your stocks in a panic, stock prices will eventually normalize. Bond prices will eventually converge to par value as you hold them to maturity so there is no loss if you don’t sell before then. Stocks and bonds are risky assets and at any given moment in time you can lose a lot of money by trading badly. Everybody loses in some way with inflation but high interest rates benefit those who can take advantage of them.

[@nellyx8051]

@@Basta11 Nice explanation. In the real world though higher rates bring down inflation because less new credit is issued. Maybe it's more accurate to say it's a tax on borrowers and a reward for savers. Since inflation works against savers maybe they're the ones who finally deserve the reward.

[@wanderingfido]

Guys. Seriously. How do you expect a different outcome than what happened with Venezuela, Germany after WWII, or Jimmy Carter in the 1970s? Life doesn't work that way. Get real.

[@miguelferrigno]

Bahahaha this guy needs to get bulldozed over... his answer 5 years ago was "no problem inflation, just raise taxes!"

[@MC-oo4pk]

This is not true

[@miguelferrigno]

@@MC-oo4pk youre right it was her copundit stephanie kelton

[@mutton_man]

Raising taxes can curb inflation. What makes you say it doesn't?

[@Richest_Person_in_the_World]

@@miguelferrigno Kelton is really dumb but Warren is a genius

[@leightonwatkins9486]

things change ,life isn't static ,,your getting older yourself look ..what someone said 5yrs ago may not apply now

[@randallolgers8314]

I don't think I've ever seen a better backflip with double pike followed by a belly flop. Towards the end Mosler boasts that if we just listened to him real wealth would double in a few years. Then he realizes that he bats for the other team, so he stresses that all that growth could be "non-disruptive" to the environment and we would actually all be better off back in permanent lock-down. I love your stuff Maggie and appreciate that you tackled the topic and were kind, but this was a comedy piece.

[@Basta11]

I don’t see a contradiction. An increase in real wealth doesn’t have to come with more environmental destruction. It’s a matter of policy. Not saying I know the right policies, just that there are more optimal decisions over the once we currently have.

[@richcherwalk6349]

He’s saying we are the makers of our own destiny not some mysterious market forces, that’s the myth he’s trying to expose. The wealthy and powerful want everyone to believe the economy is some black box that shouldn’t be tampered with🤣

[@barryweiss9977]

So full of analogies but doesn't understand economics. Basic economics.

[@Richest_Person_in_the_World]

And yet, you thought revenues came before govt spending

[@tobymatus7481]

Or maybe he's a couple of streets ahead of you?

[@barryweiss9977]

@@Richest_Person_in_the_World what does it matter? It's the total quantity of money that is important.

[@barryweiss9977]

@@tobymatus7481 nope. He's at a dead end

[@Richest_Person_in_the_World]

@@barryweiss9977 It matters because the mainstream insists that Public Debt is horrendous but Mosler explains it's just the money supply