There are many who don't want to believe what MMT is advocating. I was just like them for some time having been convinced so by major economists, especially when there was no internet since those are the only guys our corporate owned media let us listen to. But thanks to Internet I discovered MMT and as I see it, what they put forward are the most rational and logical theories. The nation's budget is not like the budget of an individual and there is no need to balance it and there won't be any inflation as long as the money being created being used to produce goods so there won't be a lack of demand. The current system makes wealth only for a few and these few also own the media and they pay their spokesmen really well to come up with theories that only benefit this small group. But MMT exposes those fallacies. I hope people would really take the time to listen to them instead of having knee-jerk reactions since they tend to let them know that all these years they have been believing BS that make no sense. It is not your fault you did not know this, but that is all you have been taught who you considered are brilliant people.
Andrew Weeraratne I agree. But taxes are still likely a useful thing, as they are a tool to control inflation. They probably don't need to be as high, and certainly one would be foolish to pull them all away suddenly.
@Adolf Hitler you are a dolt. There are oodles of incentives to produce goods efficiently. Most people do not like to spend all day at their job, so they do not want to waste time. They have to pay taxes, so they want to get the job done in good time and get remunerated for it, not penalised or doing a poor job. People like myself love doing things (sometimes gratis) with good quality for the pleasure (creating free open source software). Some people love working and care less about the money, provided they get a living wage, they get more pleasure form living life than from hoarding money. So making money scarce is not always the bes incentive to get people working, it is also a blunt and dehumanising tool to use.
"Zero interest rates aren't normal"? LOL It's 8 years later, and interest rates are STILL zero. So I guess they're "normal" now, huh? You're all Statist Keynesians on steroids. And the day of reckoning is coming very very soon. Viva Mises and Hayek and Rothbard, you socialist jackasses.
0:05:00 - Modern Money : The Way a Sovereign Currency Works 0:43:35 - Professor Michael Hudson ___________ Which is Real : History ? Or Classical Economic's Model ? 0:45:30 - Impolite in low-surplus social network . . . 0:45:55 - Australian Story : The Nail that stands up gets hit down . 0:34:00 -
It was unfortunate that the speakers did not get a chance to respond and engage at the end - we will try not to let that happen again in the future! That said, Professor Harris's actual scholarship on Ancient Greek and Roman Money is not dissimilar from Professor Hudson's own work, from my understanding.
sorry to be off topic but does any of you know of a method to get back into an instagram account..? I was dumb lost the login password. I appreciate any tips you can offer me.
43:45: Excellent point on the difference between Economics and History -- Profesor Hudson comes out swinging and just puts Professor Wray's historical examples/analysis in the dirt.
For those interested in this apparent point of contention: Wray shows a picture of a bone and says it is apx. 50,000 years old. It has markings on it. He says he DOESN'T know what it's for however the implication is that it COULD be a recording of money/debt as he nexts show tally sticks which are definitely a record of money/debt at a later time in history. Hudson says the picture of the bone is apx. 28,000 years old as his colleague has studied it. Apparently the markings are a record of time (calendar/moon cycle). The two professors are basically in 100% general aggreement. Wray and Hudson are both critiques of neo-classical economics (i.e. current mainstream economics) and the politics surrounding this. Wray is saying there is no budgetary contraint if we desire to adress social problems, contrary to what is consitently portrayed in public debate. Hudson is saying private debt accumlation to provision the population of its basic needs in the absence of social spending is unsustainabe and crushing. Both profs. spent time supporting their analysis by enquiring into the orgins of money itself. This is becuase the foundation of 'free market' economics is based on a made up origin story of money being invented as a medium of exchange because barter was ineffecient. It is a really big deal to undermine this myth. The State Theory of Money reminds us underlings that we can make changes to our system which, I don't know, benefit the majority of us. I know, I concede, it's a really wacky idea. My apologies.
Awesome discussion. I've read Mr. Hudson's articles on Counterpunch for years, so it was very interesting to hear him speak his thoughts. Highly educational.
Great lecture. Having read prof. Wray's MMT Primer, his succinct points came as no surprise. It's issues and topics prof. Hudson spoke about that were most interesting to me, making his books and blogs next on my reading list. On a side note, funny how everybody laughed when he spoke about USA imperialism on 1:36:45
Thanks for the heads up - we will try not to make that mistake with the next video! The attendance is a bit deceptive in the video - we had about 85 people in attendance spread over the room. We hope to have more in the future (please spread the word!), but as you noted, the web-presence is the long-term aim with this series.
One of the biggest obstacles is getting people to even listen about this, they are fully convinced of what they have been told for so long about federal debt that to turn them around is a daunting task. You start to talk to them about this and they just turn off seemingly willing to believe what they have been told and will not listen to an alternative view. The big bother syndrome.. Many in congress don’t really understand how it works and don’t want to listen either. They are also willing to accept the narrative without question.. Truth is those in positions of power are don’t want the truth to be known, that no one needs to live in poverty, no one. The government’s ability to spend without limit could house everyone and feed everyone that needs it. Homelessness, drug addiction, prostitution would drop dramatically, and as a result of that so would the crime rate. But as always it is politics that prevent this from happening.Ideology and greed is stopping this. No one that employes people want their workers to have a public option. The ability to make choice about the job they do to survive the ability to say no, the ability to live free. Instead those employers would much rather have you live in fear of losing your job, being thrown in the street. Fear is how they rule, how they keep you line. Hell of a way to live isn’t it. In fear!
As Michael Hudson so eloquently explains, what is believed by many (perhaps most economists) and taught to students is a gross misrepresentation of reality. Our reliance on economists to provide policy advice to elected representatives has had a devastating impact on monetary and fiscal policies and on the design of our banking regulations and tax policies.
Yeah, I know. But if your even going to bother, you MUST, MUST, MUST be gentle & patient (very patient), going one slow step at a time, and listen carefully to want they ssay and not all to understand more than one really does. Also check that they are even open to reconsidering that what they have been already taught might be based on false or incomplete assumptions. Otherwise, your wasting your time, and the penny will never drop. That's what I think anyway. And very, ever resort to insults or project anger or annoyance.
+Vilhemo De Okcidento. Thank you for your last post. People have been repeating that "banks create money" trope when banks create only credit in proportion to their necessary reserves. It is the government alone that creates interest-free money / currency.
But when you get a loan from a bank you create the dollars/data/credits. For if you did not need the loan the money would have never have been created.
***** - "Monetary policy (crediting) does NOT lead to the creation of net financial assets." Just a minor quibble. Typical Monetary Policy, such as when the CB conducts OMO (buying/selling government bonds), alters the composition, not quantity, of net Government Financial Assets. Atypical Monetary Policy, such as when, in QE, the CB buys non-government financial assets (corporate bonds, mortgage backed securities, fraudulent junk bonds, cash for trash, etc) alters the quantity of net Government financial assets (increase). However, it did NOT alter the quantity of net financial assets, only the composition, exchanging Private Sector Financial Assets for Public Sector (Government) Financial Assets. So far, so good. Here's the exception. An example of Monetary Policy that leads to the creation of Net Financial Assets. If the CB, instead of buying Financial Assets, bought Real Assets (oil, coal, cheese, steel, molybdenum, etc) it would, by exchanging Government Financial Assets for Real Assets (a commodity), alter the quantity (increasing) of Net Financial Assets.
***** - "First, the CB does not print any money under the policy of 'quantitative easing'. What it does is buy from private banks all kinds of paper securities (derivatives, bonds, mortgages) and, in return, credits the accounts of these banks amounts to which banks can not directly use (eg lending to us)." What? These statements seem to contradict one another. When the CB credits their reserve accounts in exchange for securities this IS "money printing".
I think you mean 1:35:00. Agreed, he's special :-) If you liked that, try "Michael Hudson - Life and Thought 20180507" (the crème de la crème of MH): th-cam.com/video/hH9pzzIIEj4/w-d-xo.html You will find his comments on working for the CIA enlightening, shocking, disturbing, and humorous...
hi people, I just wanted to say thanks modern money network for sharing these lectures, also I really enjoyed L. Randall Wray's lecture simple, to the point and easy to understand. just a question for whomever, is Canada's financial system the same as the usa credit debit financial system? one last thing to contemplate on, why is it, a subject of such importance pulls in only 27,089 views? why is it, so many people would rather watch a bunch of miss guided losers on a reality tv show wherein the loser whom is the most selfish the best lair and all around acts the worst, wins a few thousand dollars that last maybe 1 year. its shameful what we have let society become. goodnight
The NTCY Canadian has a fiat currency so much of the same stuff would apply directly to them, just depends on the constraints they impose on themselves, e.g. finance their deficits by bonds (not necessary but Aus requires the same)
+The NTCY - " Canada's financial system the same as the usa credit debit financial system?" All financial systems are based on credit/debit. But yes, like the US, Canada is a Monetarily Sovereign Nation.
I'll have to check them out. Nonetheless I find Ron Paul's anti-war stance very appealing. He's the only one to draw a distinction a serious between offense and defense.
So if the government can just print money indefinitely, why ask for taxes? The argument does not pan out. There must be something the currency is based on. If everything is free, why would anyone work? Again the argument does not pan out.
@@erikjohansson4275 Totally wrong. MMT says it but it is wrong because taxes themselves do not reduce inflation and the purpose of taxes are as Molser said previously "to provision government". "To move resources from the private sector to the public sector" (see:- th-cam.com/video/HxcZBmUzplk/w-d-xo.html). What they do is transfer money from the private sector to the government sector so government can spend them again. That money is the major part of the federal budget spending. The taxes collected are not destroyed and the proof of that is the factual history of the records of yearly federal budget spending which are available on line in the Whitehouse historical records. Without those taxes the federal deficit would be almost all of the government spending which has never been the case and seldom is more than 5%. It would require the government treasury department to sell enough treasuries to get almost all of the whole amount of the budget to replace the taxes that are presently funding the government budget. Again deficits of nearly all of the government spending have never been the case and that is proof of the fallacy of the MMT idea of taxes being destroyed and not used by government to spend again.
If I'm understanding what MMT says, it's that taxes imposed on things like property ownership is the incentive to work for dollars. This is why guys like Mosler argue to eliminate income taxes if favor of property tax. What he doesn't really address as far as ive heard is, what about renters? How do they pay tax and what is the incentive to work for dollars?
The profits of the Fed are rebated to the treasury so in what way is it effectively different than internally held debt? Increasing that debt actually dilutes the share of externally held debt with no change to buying power if added productively or diluted with loss of buying power if unproductively.
Auguste Dupin yeah wtf is this Coke's subliminal marketing? So annoying! This makes me want to punch my own face for being so anti-corporation obsessed, but it made me a little sad that even in a group of people inquisitive and progressive enough to be in this lecture, a large portion were still be persuaded to buy a can of shithealtt & repulsive business practices on the way in because it tastes good. I'm such an unpleasant dweeb I know I'm sorry!
The audio is horrible because the person speaking is so far from the microphone, therefore as much room reflection from the original person speaking and what is coming out of the PA speakers is getting into the mic than the original source. Were the person within 4" of the mic the mic gain could be lowered and we would hear little room reflection so the recording would be much less harsh and also clearer. Fault - AV Department.
If you're interested in this line of thought, Peter Cooper at Heteconomist blog has a piece called "Fiat Money Socialism vs Lower Form Communism" that addresses this issue.
The next seminar is Friday, October 5th at 6.15pm EST, on the Eurozone. It will be streamed live on the main page of the series website, which is listed above in the video description.
S10 of the Federal Reserve Act states: "Nothing in this Act contained shall be construed as taking away any powers heretofore vested by law in the Secretary of the Treasury which relate to the supervision, management, and control of the Treasury Department... wherever any power vested by this Act in the ... Federal Reserve System ... appears to conflict with the powers of the Secretary of the Treasury, such powers shall be exercised subject to the supervision and control of the Secretary."
Scott - "owing money on currency" does not make sense for $US. All forms of U.S. currency are only promises to pay other forms of U.S. currency. As Wray says, they are all "debts" of the government, in that they promise to be redeemable in payment of taxes. They are a private sector tax-credit, and a public sector tax-extinguishing liability. It is-as Wray suggests-bad to pay interest to banks unnecessarily, but the Federal Reserve can set the rate and "owing big" doesn't apply (see above).
I would urge students of monetary policy and monetary history to read what Adam Smith had to say about the Bank of Amsterdam and its impact on the international economy of that era. The Bank at that time was publicly owned, was a deposit bank and not a lending institution, and issued receipt money fully backed by coinage of a standard weight and measure.
The Federal Reserve is created by an Act of Congress - all of its profits are remitted back to the Treasury, and . Distinctions between the Federal Reserve and the Treasury exist legally, but all liabilities of both bodies are liabilities of the U.S. Government. You can even see this if you look at a $1 Federal Reserve note!
FYI, the speakers are listed in the wrong order in the video description. Wray spoke first. The MMT summit in Italy was heavily attended, presumably because more Italians are aware that the system they belong to is in crisis, and they're ready to hear explanations and alternatives. At first sight the low attendance at Columbia is disheartening. Then again, there are already more yt views than there were people in attendance. Here's hoping the momentum picks up.
If a sovereign government issuing its own currency cannot default on its debt, why have so many states (having their own national currencies) defaulted on their debt throughout history, incl. e.g. Russia in 1998?
This is too easy. Russia defaulted on its debt because it pegged its currency to the dollar. It was the *dollar* debt it defaulted on, not the ruble. If you look at other countries that had debt in other currencies, they were not *sovereign* in the way we’re defining it. You’ve got to read at least the basics before making comments like this.
The government should only "spend more" if the upshot of its spending will be a larger national capital stock. If it spends its money producing "public relations gurus", "diversity consultants" and "economists" (people and/or agencies that continue consuming resources while producing nothing) national wealth will be run down. If (best case scenario) its spending produces a larger stock relative to the amount by which the money proxy increased (negative net dilution), this (given reasonable dispersal of said monies) is guaranteed to crowd in private sector investment as entrepreneurs note the higher real returns available. You will have GDP growth and some amount of price deflation, determined by levels of wage stickiness and marketization and the extent to which capital generation outstrips its proxy. Longer term patterns dependent on structural and sustainability issues, resource monetization versus collective commons sentiments. If it generates some increase in the capital stock lower than the increase in the money stock, resultant growth will be determined predominantly by how close the economy had been previous to its PPF. Short term growth inevitable while prices indeterminable, with longer term trends again determined by the above considerations, but with "false boom" concerns borne more in mind by monetary policy makers. Somewhat paradoxically, politically the hardest price inflation to combat. If the net effect is simple currency dilution this is guaranteed to crowd out private sector investment, as increased aggregate demand met only by stagnant production. You will be left with a national capital stock priced (in its various incarnations) more dearly, and likely lower average consumer wealth, depending on how painful remedial measures to combat the price inflation are and how much entrepreneurs' animal spirits are dampened. Stagflation likely.
Finally something on economics that makes any sense. Everything I read on economics up until now sounds more like secular religion than anything else. The Historical Evolution of Money and Debt modernmoneynetwork.org/symposia/historical-evolution-money-and-debt My notes: To pay a person/institution the government commands a bank to credits the bank's reserves & credits his eaccount To pay the government a person/institution commands a bank to debits his eaccount & debits the bank's reserves Note the bank is the official intermediary & record keeper of $ transactions between the government & person/insitution. Desposit spending: spending > tax income & causes excess reserves the crux of loan interest rate A bond is a loan repayed with periodic fixed interest payments & then return of principal ?Bonds are to adjust the interest rate? Surplus spending: tax income > spending
6:15 Q1:Just like a household, a nation has to raise money to finance its spending through income or borrowing. Q2:The role of taxes is to provide finance for government spending Q3:The national government borrows money from the private sector to finance the budget deficit Q4:By running budget surpluses, the government takes pressure off the interest rates because more money is available to the private sector for investment projects Q5:Persistent budget deficits will burden future generations with inflation and higher taxes Q6:Running budget surpluses will provide the government with the resources needed to finance spending on retirement benefits for the ageing population in the future ABC's of Modern Monetary Theory (MMT) | WEA Pedagogy Blog weapedagogy.wordpress.com/2020/12/11/abcs-of-modern-monetary-theory-mmt/ 8:50 PAUL SAMUELSON ON DEFICIT MYTHS - New Economic Perspectives neweconomicperspectives.org/2010/04/paul-samuelson-on-deficit-myths.html John Maynard Keynes - Life, Ideas, Legacy 1995 th-cam.com/video/JpIJvAt3dTc/w-d-xo.htmlm49s 1:18:23
VERY few people understand what Michael Hudson is discussing when it comes to Middle Eastern Societies. They basically just fell apart. Before that time, their libraries, scientific advacements, mathematics, astronomy, linguistical research ... was just _ stunning _ The Middle East before the rise of the West, rivaled China as a center of learning, science and technology ...
In “Occupying Chairlifts” a simple rule tweak on inheritance ends up changing the direction and purpose of modern human life! Here’s a fair way to transition forward to where we’re rewarded for cooperating and creating instead of competing and conquering. It's something specific we can demand. If this isnt the best answer, at least we’re thinking about what might be. Are we really just this close to having it work right? Oh yeah, it's a Ski movie! “Occupying Chairlifts” on TH-cam!
.. "is the debt in which other debts are denominated" .... Does it add 4th characteristic of money (mean of exchange, mean for value storage , measure of value)? Please point me if you can to Modern Monetary Theory here on YT or somewhere else.
Which means without banks loaning to us, there weren't be enough means to trade, which means we will always pay interest on our money whether through our government, industries or home loans. That means banks will ALWAYS make a lot of money by doing nothing, is it fare?
That oft-repeated provision bears deeper analysis. The Fed is now the largest purchaser of Treasuries-a historical anomaly. “It’s interest that the Treasury didn’t have to pay to the Chinese,” Bernanke, told Congress last year. This may change when the Fed finally raises interest rates & treasuries become more attractive to others again. What other agency gets to cost the gov't more at its whim? See: Fed Turns Over $77 Billion in Profits to the Treasury in the NY Times archives.
I really like Micheal Hudson google MMT Rimini Summit Italy you'll be surprised to hear what a great lecture he did in here together whit M. Auerback,S.Kelton W.Black and Parguez from France andBonny Falkner from the radio guns & butter. we were more than two thousand people. to bad Wray could not come.
Money should food standard viz Rs 100/- equivalent to 3 kg rice of certain quality. It is because if labor cost increase due labor standard remuneration, but due technology improvement food price will (rather should) remain same. Commodity standard money ( like gold standard) has certain flaw as natural source will has limitation. Hence fix value currency is must
How do bankers become so powerful that 'governments depend on bankers to lend them money so that they can wage war'? Given that the money is supported by the taxation power, how do the money lenders infiltrate the system and become so powerful, when at the outset they themselves have no (taxation) power?
We are in the biggest balance sheet recession in history. Governments, banks and corporations are bankrupt on paper but have the cash flow to keep running their operations. When corporations and individuals lose their cash flow, they go out of business or are reorganized somehow. When the govt runs out of cash they print it up. When banks run out of cash they may or may not get bailed out one way or another. It depends on what politicians the banks own.The risk seems always to be transferred to the unwary individuals. The profits are always head to the top and loss always run to the people. With govt supposedly of, by and for the people, I like the way we have been screwing ourselves by allowing this arrangement. Great scam supported by great propaganda. We were warned by our forefathers about the banking scam and went right ahead with it anyway. They predicted all of us being slaves on the plantation we used to own. They told us how it would happen and we volunteered to be in this system. If you apply the concept of not understanding the laws or mechanism by which you ended up holding the liability, do you think you might have been swindled? Its all in the fine print. We are responsible, not them. They took advantage with the power which we gave them, and hid behind the laws we allowed them to write.
outofmage Feng - "Which means without banks loaning to us, there weren't be enough means to trade, which means we will always pay interest on our money whether through our government, industries or home loans. I think what you are saying is that all money creation occurs through lending at interest. While bank credit creation certainly occurs this way, government money creation via Federal spending does not. Federal spending issues new money into the economy by crediting accounts. Money is a non-interest bearing debt of the Federal Government. - "That means banks will ALWAYS make a lot of money by doing nothing, is it fare?" Banks don't "do nothing", they, in fact, do do something & for that something there is nothing wrong with a bank earning a normal rate of return.
Vilhelmo De Okcidento false. Money spent for goods and services by the government only has interest because of the sale of bonds which Congress Chooses to pay back through taxation. This is a political choice not inherent. If Congress chose to, they could spend money into existence without selling bonds. And the bond backed government money has an extremely low interest rate, which is worth noting.
Vilhelmo De Okcidento the credit to accounts is interest free until loaned out. If the government purchases a contractor's services, the digital credit to the account is just money created. No interest is created until Congress decides to back that expense with a Treasury bond, which carries interest.
I wish they would have gotten into the exact numbers that the Chinese hold ... people may be surprised at how small a % of they actually hold, and how quickly it bleeds off, and who actually owns - in terms of BPS - US Credit Instruments ...
The national debt does allow people to buy tax exemptions into the future and to store wealth in taxing power. Its not necessarily a good thing to allow unlimited stores of wealth and stores of wealth are in many ways just debt instruments on productive economy. Allowing someone a 40 year mortgage allows more total debt absorption than a 30 year mortgage. According to the same principle the more government debt , the more the top 1% can buy tax exemptions which is to say "earning interest".
As my friend, Ron, was trying to get at in the first question, the Federal Reserve is NOT the gov't, and debt is only owed to external bodies incl. the Fed reserve. It doesn't owe money on currency issued in coins or U.S. Notes. The interest rate will not be near zero forever, and then we will owe big (and the Federal reserve chooses the interest rate, not the gov't). Wray is Wrong.
Harris : my education was free, and a good investment for the govt, except that I emigrated in which case it was just a subsidy paid by the people of my country to the USA where I emigrated to 🤣
Why have government deficits been rising at the same time private sector savings have went down in America. Shouldn’t the deficits caused the household savings to go up.
It depends on the size of the government deficits compared to the amount of aggregate spending on goods and services in the economy. Apparently the aggregate spending has outstripped deficit spending.
if your countrys balance of payment is negative that means that ure currency is loosing value or ure country can purchase less goods,if it is loosing value or if it is purchasing less goods it means that the purchasing power of the citizens of the country rellay more and more in domestic production,witch means fewer goods witch means INFLATION...simple concept
Congress self-imposing a debt ceiling is even worse than Wray suggests. Since to fuel an economy the government must deficit spend into it, over time the deficit should naturally grow and accumulate each year if you have a productive economy. So it should naturally grow without limit. The critical number is the *rate of change of the deficit*, not the absolute value (which is meaningless without historical context). So a debt ceiling effectively says, "we _want_ people to be unemployed, we _want_ less growth than sustainably possible". So deficit hawkery is worse than wrong, it is sheer impoverishing *madness*.
"the mathematics of 2000 BC were superior to todays mathematics" ... that is what Michael Hudson said ... is he affirming the so much maligned theory of prehistoric civilizations like the ones Graham Hancock and others speak about ?... because it would answer a lot of questions that were, to this day, relegated to the category of mysteries ...
Education as an asset is going to be available from the virtual classroom soon. When this happens the brick and mortar school is going to be obsolete. Can you imagine the resistance of the educational system to this? Only the very best teachers will be needed. How many "teachers" do we have that will be out of a job. Maybe we should have taken more interest in math.
Randall, the economic system is not slightly off course...were destroying the planets ecosystems, fiddling with antiquated monetary design beliefs is not going to cut it.
We are all sheep... or at least I am. The first speaker showed us the bone with the notches and said he did not know what it was but when he followed up with the notches on wood, I imagined the bone might be a type of tally for goods. Next speaker comes up and we find out the bone was likely for tracking moon cycles. I listen, think about it, and if it makes sort-of sense I take it. I am a sheep because I do not know more than I am told or shown or find.
The fact remains it would be much cheaper & we would benefit form the seigniorage, if we simply produced debt-free U.S. Notes direct from Treasury instead of paying interest for our own currency.
I understand the the mass amount of credit being created by the private sector banks and the burden it places on the people and the economy. Yet if government spends money on things such as war or even giving welfare isn’t that just a tax on the productive economy to pay for the unproductive economy. The money needs to go into productive things not destructive things. If the government prints money and doesn’t spend it on productive things is it not as bad as the banks doing it? Say with education if the government prints money so everyone can get an education but the education is unproductive or their are no jobs to support the education is it not hidden inflation or a tax on the rest of the economy?
When government makes more money say to pay for FDIC or any other program they make more debt and the taxpayer has to pay that debt because the bonds created to fund the new money mature and the taxpayers are the only ones who can pay for it. The public pay in real terms with the burden of that payment decreasing their ability to pay for anything else. There is no magic funding of the economy but there is a belief that some self promoting politically biased economists push (like here) to deceptive to people whom they prey on and who are unfortunately easily deceived because they are not aware of the way it operates and are drawn in by the cruel deception.
It's easier for Americans to have a confused view of debt because they see China (for example) as giving the USA goods in return for bonds (which MMTers basically say have no value, so they get goods for... free! As Mosler said 'all we owe China is a bank statement' ). This is nuts from a common sense perspective. Most countries require payment in their own currency, not in YOUR currency. As you require more Yuan to buy Chinese goods the $ depreciates relatively - with help from MMT it can soon depreciate to zero. Only reasons this has not happened is because 1) China happy to own America by taking more and more credit (for now) 2) China keeping Yuan artificially low - playing the long game - subsiding US purchases from China until US manufacturing capacity is completely dead and China owns global productive capacity.
I did NOT appreciate the moderator's comments after M Hudson's presentation, saying the problems in the EMU were OVER-stated and that the eurozone is "doing rather well, for some of its components"(!!) Exactly which components would that be? Appalling. If one man chops off his entire hand, and another man only chops off one of his fingers, I wouldn't praise the latter for doing "rather well".
He’s wrong. Central banks do create private wealth with its operations. They can lower rates thus expanding credit for asset purchases. Asset purchases push asset prices up. Those who were holding assets prior to the fed operations become wealthier as their assets are valued higher. They can tap this wealth through more collateralization of their assets or asset sales. The former is more common in the housing market.
But the interest free money lies on the "issue of money" liability takes only 3% of the whole money supply. 97% of them are created by the private banks, and need interest payment.
Hudson again wrong at 1.13 when he says equity is on the liabilities side of the balance sheet. He fails to understand that someone's liabilty is another's asset because that is the way pure financial assets exist. It cannot exist any other way.
I don't know what we would do without Michael Hudson.
Here for The Hudson!! 💕💕💕
Michael Hudson is amazing! Give 'em hell!
He is a force of nature. Relentless logic and knowledge.
Hudson is always on point. His take on junk bonds will blow you away.
There are many who don't want to believe what MMT is advocating. I was just like them for some time having been convinced so by major economists, especially when there was no internet since those are the only guys our corporate owned media let us listen to. But thanks to Internet I discovered MMT and as I see it, what they put forward are the most rational and logical theories. The nation's budget is not like the budget of an individual and there is no need to balance it and there won't be any inflation as long as the money being created being used to produce goods so there won't be a lack of demand. The current system makes wealth only for a few and these few also own the media and they pay their spokesmen really well to come up with theories that only benefit this small group. But MMT exposes those fallacies. I hope people would really take the time to listen to them instead of having knee-jerk reactions since they tend to let them know that all these years they have been believing BS that make no sense. It is not your fault you did not know this, but that is all you have been taught who you considered are brilliant people.
Andrew Weeraratne
I agree. But taxes are still likely a useful thing, as they are a tool to control inflation. They probably don't need to be as high, and certainly one would be foolish to pull them all away suddenly.
One Day & Two TH-cam Lectures & one night's sleep & One Thought-Game of Monopoly was all I needed
@Adolf Hitler you are a dolt. There are oodles of incentives to produce goods efficiently. Most people do not like to spend all day at their job, so they do not want to waste time. They have to pay taxes, so they want to get the job done in good time and get remunerated for it, not penalised or doing a poor job. People like myself love doing things (sometimes gratis) with good quality for the pleasure (creating free open source software). Some people love working and care less about the money, provided they get a living wage, they get more pleasure form living life than from hoarding money. So making money scarce is not always the bes incentive to get people working, it is also a blunt and dehumanising tool to use.
"Zero interest rates aren't normal"? LOL It's 8 years later, and interest rates are STILL zero. So I guess they're "normal" now, huh? You're all Statist Keynesians on steroids. And the day of reckoning is coming very very soon. Viva Mises and Hayek and Rothbard, you socialist jackasses.
LOL! I remember running into you ay least 6 years ago. And today, you have managed to accrue TWELVE subscribers! LMAO! You idiot!
0:05:00 - Modern Money : The Way a Sovereign Currency Works
0:43:35 - Professor Michael Hudson
___________ Which is Real : History ? Or Classical Economic's Model ?
0:45:30 - Impolite in low-surplus social network . . .
0:45:55 - Australian Story : The Nail that stands up gets hit down
.
0:34:00 -
It was unfortunate that the speakers did not get a chance to respond and engage at the end - we will try not to let that happen again in the future!
That said, Professor Harris's actual scholarship on Ancient Greek and Roman Money is not dissimilar from Professor Hudson's own work, from my understanding.
sorry to be off topic but does any of you know of a method to get back into an instagram account..?
I was dumb lost the login password. I appreciate any tips you can offer me.
43:45: Excellent point on the difference between Economics and History -- Profesor Hudson comes out swinging and just puts Professor Wray's historical examples/analysis in the dirt.
No he doesn't.
For those interested in this apparent point of contention: Wray shows a picture of a bone and says it is apx. 50,000 years old. It has markings on it. He says he DOESN'T know what it's for however the implication is that it COULD be a recording of money/debt as he nexts show tally sticks which are definitely a record of money/debt at a later time in history. Hudson says the picture of the bone is apx. 28,000 years old as his colleague has studied it. Apparently the markings are a record of time (calendar/moon cycle).
The two professors are basically in 100% general aggreement. Wray and Hudson are both critiques of neo-classical economics (i.e. current mainstream economics) and the politics surrounding this. Wray is saying there is no budgetary contraint if we desire to adress social problems, contrary to what is consitently portrayed in public debate. Hudson is saying private debt accumlation to provision the population of its basic needs in the absence of social spending is unsustainabe and crushing. Both profs. spent time supporting their analysis by enquiring into the orgins of money itself. This is becuase the foundation of 'free market' economics is based on a made up origin story of money being invented as a medium of exchange because barter was ineffecient. It is a really big deal to undermine this myth. The State Theory of Money reminds us underlings that we can make changes to our system which, I don't know, benefit the majority of us. I know, I concede, it's a really wacky idea. My apologies.
the answer to the first question approx 34mins... mind blown, I clearly had no idea how the monetary system works, this is really good content
Awesome discussion. I've read Mr. Hudson's articles on Counterpunch for years, so it was very interesting to hear him speak his thoughts. Highly educational.
Great lecture. Having read prof. Wray's MMT Primer, his succinct points came as no surprise. It's issues and topics prof. Hudson spoke about that were most interesting to me, making his books and blogs next on my reading list.
On a side note, funny how everybody laughed when he spoke about USA imperialism on 1:36:45
I guess they don't care about other people.
Hi,
We are working on a transcript - We will put it up as soon as possible. Thank you in advance for your patience.
waiting
LOL! It's EIGHT YEARS LATER! You're all Statist Keynesian Communist Fascists.
@@soapbxprod, can you say “Oxymorons”?
Fascinating!
@@soapbxprod okay, libertarian. go worship at the Altar of Friedman or smth
Thanks for the heads up - we will try not to make that mistake with the next video!
The attendance is a bit deceptive in the video - we had about 85 people in attendance spread over the room. We hope to have more in the future (please spread the word!), but as you noted, the web-presence is the long-term aim with this series.
One of the biggest obstacles is getting people to even listen about this, they are fully convinced of what they have been told for so long about federal debt that to turn them around is a daunting task.
You start to talk to them about this and they just turn off seemingly willing to believe what they have been told and will not listen to an alternative view. The big bother syndrome..
Many in congress don’t really understand how it works and don’t want to listen either.
They are also willing to accept the narrative without question..
Truth is those in positions of power are don’t want the truth to be known, that no one needs to live in poverty, no one.
The government’s ability to spend without limit could house everyone and feed everyone that needs it.
Homelessness, drug addiction, prostitution would drop dramatically, and as a result of that so would the crime rate.
But as always it is politics that prevent this from happening.Ideology and greed is stopping this. No one that employes people want their workers to have a public option.
The ability to make choice about the job they do to survive the ability to say no, the ability to live free.
Instead those employers would much rather have you live in fear of losing your job, being thrown in the street.
Fear is how they rule, how they keep you line. Hell of a way to live isn’t it. In fear!
As Michael Hudson so eloquently explains, what is believed by many (perhaps most economists) and taught to students is a gross misrepresentation of reality. Our reliance on economists to provide policy advice to elected representatives has had a devastating impact on monetary and fiscal policies and on the design of our banking regulations and tax policies.
BuddhaNature c
Yeah, I know.
But if your even going to bother, you MUST, MUST, MUST be gentle & patient (very patient), going one slow step at a time, and listen carefully to want they ssay and not all to understand more than one really does.
Also check that they are even open to reconsidering that what they have been already taught might be based on false or incomplete assumptions.
Otherwise, your wasting your time, and the penny will never drop. That's what I think anyway.
And very, ever resort to insults or project anger or annoyance.
Getting people to listen about fascism? You and your three subscribers. LMAO
+Vilhemo De Okcidento. Thank you for your last post. People have been repeating that "banks create money" trope when banks create only credit in proportion to their necessary reserves. It is the government alone that creates interest-free money / currency.
I would only add that RR don't limit bank credit creation. They only increase the cost.
But when you get a loan from a bank you create the dollars/data/credits. For if you did not need the loan the money would have never have been created.
CosmosPrivateer
Yes, loans create deposits.
It is the supply of good borrowers that restricts credit creation.
***** - "Monetary policy (crediting) does NOT lead to the creation of net financial assets."
Just a minor quibble.
Typical Monetary Policy, such as when the CB conducts OMO (buying/selling government bonds), alters the composition, not quantity, of net Government Financial Assets.
Atypical Monetary Policy, such as when, in QE, the CB buys non-government financial assets (corporate bonds, mortgage backed securities, fraudulent junk bonds, cash for trash, etc) alters the quantity of net Government financial assets (increase).
However, it did NOT alter the quantity of net financial assets, only the composition, exchanging Private Sector Financial Assets for Public Sector (Government) Financial Assets.
So far, so good.
Here's the exception.
An example of Monetary Policy that leads to the creation of Net Financial Assets.
If the CB, instead of buying Financial Assets, bought Real Assets (oil, coal, cheese, steel, molybdenum, etc) it would, by exchanging Government Financial Assets for Real Assets (a commodity), alter the quantity (increasing) of Net Financial Assets.
***** - "First, the CB does not print any money under the policy of 'quantitative easing'. What it does is buy from private banks all kinds of paper securities (derivatives, bonds, mortgages) and, in return, credits the accounts of these banks amounts to which banks can not directly use (eg lending to us)."
What?
These statements seem to contradict one another.
When the CB credits their reserve accounts in exchange for securities this IS "money printing".
Thank you for uploading, this information is vital.
Michael Hudson at 1:35 pure brilliance
I think you mean 1:35:00.
Agreed, he's special :-)
If you liked that, try "Michael Hudson - Life and Thought 20180507" (the crème de la crème of MH):
th-cam.com/video/hH9pzzIIEj4/w-d-xo.html
You will find his comments on working for the CIA enlightening, shocking, disturbing, and humorous...
Thank you very much. It clarifies my thinking on 'money'. The conclusion is where we are today . . what next . . Michael Hudson ascends ...
hi people, I just wanted to say thanks modern money network for sharing these lectures, also I really enjoyed L. Randall Wray's lecture simple, to the point and easy to understand.
just a question for whomever, is Canada's financial system the same as the usa credit debit financial system?
one last thing to contemplate on, why is it, a subject of such importance pulls in only 27,089 views? why is it, so many people would rather watch a bunch of miss guided losers on a reality tv show wherein the loser whom is the most selfish the best lair and all around acts the worst, wins a few thousand dollars that last maybe 1 year. its shameful what we have let society become. goodnight
The NTCY Canadian has a fiat currency so much of the same stuff would apply directly to them, just depends on the constraints they impose on themselves, e.g. finance their deficits by bonds (not necessary but Aus requires the same)
+The NTCY - " Canada's financial system the same as the usa credit debit financial system?"
All financial systems are based on credit/debit.
But yes, like the US, Canada is a Monetarily Sovereign Nation.
I'll have to check them out. Nonetheless I find Ron Paul's anti-war stance very appealing. He's the only one to draw a distinction a serious between offense and defense.
Thank you for making this information accessible :)
So if the government can just print money indefinitely, why ask for taxes? The argument does not pan out. There must be something the currency is based on. If everything is free, why would anyone work? Again the argument does not pan out.
To reduce inflation, primarily.
@@erikjohansson4275 Totally wrong. MMT says it but it is wrong because taxes themselves do not reduce inflation and the purpose of taxes are as Molser said previously "to provision government". "To move resources from the private sector to the public sector" (see:- th-cam.com/video/HxcZBmUzplk/w-d-xo.html).
What they do is transfer money from the private sector to the government sector so government can spend them again. That money is the major part of the federal budget spending.
The taxes collected are not destroyed and the proof of that is the factual history of the records of yearly federal budget spending which are available on line in the Whitehouse historical records. Without those taxes the federal deficit would be almost all of the government spending which has never been the case and seldom is more than 5%.
It would require the government treasury department to sell enough treasuries to get almost all of the whole amount of the budget to replace the taxes that are presently funding the government budget. Again deficits of nearly all of the government spending have never been the case and that is proof of the fallacy of the MMT idea of taxes being destroyed and not used by government to spend again.
If I'm understanding what MMT says, it's that taxes imposed on things like property ownership is the incentive to work for dollars. This is why guys like Mosler argue to eliminate income taxes if favor of property tax. What he doesn't really address as far as ive heard is, what about renters? How do they pay tax and what is the incentive to work for dollars?
1:19:00 crazy to hear the media say russia defaulted on us debt, when its us who defaulted by not accepting payment
someone drinking a lot of beer in the background?
Where are you this Is an awesome coversation
The profits of the Fed are rebated to the treasury so in what way is it effectively different than internally held debt? Increasing that debt actually dilutes the share of externally held debt with no change to buying power if added productively or diluted with loss of buying power if unproductively.
Was it BYOB? I've never heard so many cans being opened. ::Cah-snick::
Just saying...
Auguste Dupin yeah wtf is this Coke's subliminal marketing? So annoying! This makes me want to punch my own face for being so anti-corporation obsessed, but it made me a little sad that even in a group of people inquisitive and progressive enough to be in this lecture, a large portion were still be persuaded to buy a can of shithealtt & repulsive business practices on the way in because it tastes good. I'm such an unpleasant dweeb I know I'm sorry!
hahahahaha I love coke to death
Next seminar on the Eurozone is now up for viewing!
The audio is horrible because the person speaking is so far from the microphone, therefore as much room reflection from the original person speaking and what is coming out of the PA speakers is getting into the mic than the original source. Were the person within 4" of the mic the mic gain could be lowered and we would hear little room reflection so the recording would be much less harsh and also clearer. Fault - AV Department.
If you're interested in this line of thought, Peter Cooper at Heteconomist blog has a piece called "Fiat Money Socialism vs Lower Form Communism" that addresses this issue.
OMG, the last 3 minutes of the video shows the moderator didn't listen to a single word Dr. Wray said!!!
Wray is a Keynesian Statist jackass
Michael Hudson gives so many pearls of wisdom so quickly its hard to keep up with him
cant scud the hud!!
The next seminar is Friday, October 5th at 6.15pm EST, on the Eurozone. It will be streamed live on the main page of the series website, which is listed above in the video description.
S10 of the Federal Reserve Act states:
"Nothing in this Act contained shall be construed as taking away any powers heretofore vested by law in the Secretary of the Treasury which relate to the supervision, management, and control of the Treasury Department... wherever any power vested by this Act in the ... Federal Reserve System ... appears to conflict with the powers of the Secretary of the Treasury, such powers shall be exercised subject to the supervision and control of the Secretary."
Scott - "owing money on currency" does not make sense for $US. All forms of U.S. currency are only promises to pay other forms of U.S. currency. As Wray says, they are all "debts" of the government, in that they promise to be redeemable in payment of taxes. They are a private sector tax-credit, and a public sector tax-extinguishing liability.
It is-as Wray suggests-bad to pay interest to banks unnecessarily, but the Federal Reserve can set the rate and "owing big" doesn't apply (see above).
I would urge students of monetary policy and monetary history to read what Adam Smith had to say about the Bank of Amsterdam and its impact on the international economy of that era. The Bank at that time was publicly owned, was a deposit bank and not a lending institution, and issued receipt money fully backed by coinage of a standard weight and measure.
The Federal Reserve is created by an Act of Congress - all of its profits are remitted back to the Treasury, and . Distinctions between the Federal Reserve and the Treasury exist legally, but all liabilities of both bodies are liabilities of the U.S. Government. You can even see this if you look at a $1 Federal Reserve note!
Feels like five (5) episodes of the Oddysey.
An episode for a day (eight hours) of educational games/competitions.
Yes, it was unfortunate - We will try harder next time.
Love how Michael Hudson lead with guns and bombs with what government spends money on -.-
FYI, the speakers are listed in the wrong order in the video description. Wray spoke first.
The MMT summit in Italy was heavily attended, presumably because more Italians are aware that the system they belong to is in crisis, and they're ready to hear explanations and alternatives.
At first sight the low attendance at Columbia is disheartening. Then again, there are already more yt views than there were people in attendance. Here's hoping the momentum picks up.
MICHAEL HUDSON wat a genius
If a sovereign government issuing its own currency cannot default on its debt, why have so many states (having their own national currencies) defaulted on their debt throughout history, incl. e.g. Russia in 1998?
This is too easy.
Russia defaulted on its debt because it pegged its currency to the dollar. It was the *dollar* debt it defaulted on, not the ruble. If you look at other countries that had debt in other currencies, they were not *sovereign* in the way we’re defining it. You’ve got to read at least the basics before making comments like this.
The government should only "spend more" if the upshot of its spending will be a larger national capital stock. If it spends its money producing "public relations gurus", "diversity consultants" and "economists" (people and/or agencies that continue consuming resources while producing nothing) national wealth will be run down.
If (best case scenario) its spending produces a larger stock relative to the amount by which the money proxy increased (negative net dilution), this (given reasonable dispersal of said monies) is guaranteed to crowd in private sector investment as entrepreneurs note the higher real returns available. You will have GDP growth and some amount of price deflation, determined by levels of wage stickiness and marketization and the extent to which capital generation outstrips its proxy. Longer term patterns dependent on structural and sustainability issues, resource monetization versus collective commons sentiments.
If it generates some increase in the capital stock lower than the increase in the money stock, resultant growth will be determined predominantly by how close the economy had been previous to its PPF. Short term growth inevitable while prices indeterminable, with longer term trends again determined by the above considerations, but with "false boom" concerns borne more in mind by monetary policy makers. Somewhat paradoxically, politically the hardest price inflation to combat.
If the net effect is simple currency dilution this is guaranteed to crowd out private sector investment, as increased aggregate demand met only by stagnant production. You will be left with a national capital stock priced (in its various incarnations) more dearly, and likely lower average consumer wealth, depending on how painful remedial measures to combat the price inflation are and how much entrepreneurs' animal spirits are dampened. Stagflation likely.
The "government" has no money of its own. It only takes what it has by force from the citizenry. Imbecile.
Please could you explain how is money=debt from accounting perspective?
If I find a piece of gold by the river and buy loaf of bread, who is indebted?
Randall Wray = a genius. One of my intellectual heroes.
Finally something on economics that makes any sense. Everything I read on economics up until now sounds more like secular religion than anything else.
The Historical Evolution of Money and Debt modernmoneynetwork.org/symposia/historical-evolution-money-and-debt
My notes:
To pay a person/institution the government commands a bank to credits the bank's reserves & credits his eaccount
To pay the government a person/institution commands a bank to debits his eaccount & debits the bank's reserves
Note the bank is the official intermediary & record keeper of $ transactions between the government & person/insitution.
Desposit spending: spending > tax income & causes excess reserves the crux of loan interest rate
A bond is a loan repayed with periodic fixed interest payments & then return of principal
?Bonds are to adjust the interest rate?
Surplus spending: tax income > spending
Great upload thanks.
6:15
Q1:Just like a household, a nation has to raise money to finance its spending through income or borrowing.
Q2:The role of taxes is to provide finance for government spending
Q3:The national government borrows money from the private sector to finance the budget deficit
Q4:By running budget surpluses, the government takes pressure off the interest rates because more money is available to the private sector for investment projects
Q5:Persistent budget deficits will burden future generations with inflation and higher taxes
Q6:Running budget surpluses will provide the government with the resources needed to finance spending on retirement benefits for the ageing population in the future
ABC's of Modern Monetary Theory (MMT) | WEA Pedagogy Blog weapedagogy.wordpress.com/2020/12/11/abcs-of-modern-monetary-theory-mmt/
8:50
PAUL SAMUELSON ON DEFICIT MYTHS - New Economic Perspectives
neweconomicperspectives.org/2010/04/paul-samuelson-on-deficit-myths.html
John Maynard Keynes - Life, Ideas, Legacy 1995
th-cam.com/video/JpIJvAt3dTc/w-d-xo.htmlm49s
1:18:23
VERY few people understand what Michael Hudson is discussing when it comes to Middle Eastern Societies. They basically just fell apart. Before that time, their libraries, scientific advacements, mathematics, astronomy, linguistical research ... was just _ stunning _
The Middle East before the rise of the West, rivaled China as a center of learning, science and technology ...
1:18 we should not sell real estate to anyone but citizens. Do you want to rent your home from foreigners?
Saudis own alot of us real estate
In “Occupying Chairlifts” a simple rule tweak on inheritance ends up changing the direction and purpose of modern human life! Here’s a fair way to transition forward to where we’re rewarded for cooperating and creating instead of competing and conquering.
It's something specific we can demand. If this isnt the best answer, at least we’re thinking about what might be. Are we really just this close to having it work right?
Oh yeah, it's a Ski movie! “Occupying Chairlifts” on TH-cam!
How did these Chinese predictions pan out?
Google for "energy backed money", what do you think?
2022 glad TH-cam suggested this. Randall Wray starts this with a "bang." As a Modern Money 101, this remains entirely relevant.
Very relevant
.. "is the debt in which other debts are denominated" ....
Does it add 4th characteristic of money (mean of exchange, mean for value storage , measure of value)?
Please point me if you can to Modern Monetary Theory here on YT or somewhere else.
Which means without banks loaning to us, there weren't be enough means to trade, which means we will always pay interest on our money whether through our government, industries or home loans. That means banks will ALWAYS make a lot of money by doing nothing, is it fare?
Hi, is there a transcript of this anywhere?
The moderator said you're not taking away someone's livelihood by burdening them with debt? That's exactly what's happening.
That oft-repeated provision bears deeper analysis. The Fed is now the largest purchaser of Treasuries-a historical anomaly. “It’s interest that the Treasury didn’t have to pay to the Chinese,” Bernanke, told Congress last year. This may change when the Fed finally raises interest rates & treasuries become more attractive to others again. What other agency gets to cost the gov't more at its whim? See: Fed Turns Over $77 Billion in Profits to the Treasury in the NY Times archives.
I really like Micheal Hudson
google
MMT Rimini Summit Italy
you'll be surprised to hear what a great lecture he did in here together whit M. Auerback,S.Kelton W.Black and Parguez from France andBonny Falkner from the radio guns & butter.
we were more than two thousand people.
to bad Wray could not come.
Harris seemed to have issues with Hudson's interpretation/narrative of history, anyone know what they might be?
Money should food standard viz Rs
100/- equivalent to 3 kg rice of certain quality. It is because if labor cost increase due labor standard remuneration, but due technology improvement food price will (rather should) remain same. Commodity standard money ( like gold standard) has certain flaw as natural source will has limitation. Hence fix value currency is must
How do bankers become so powerful that 'governments depend on bankers to lend them money so that they can wage war'? Given that the money is supported by the taxation power, how do the money lenders infiltrate the system and become so powerful, when at the outset they themselves have no (taxation) power?
We are in the biggest balance sheet recession in history. Governments, banks and corporations are bankrupt on paper but have the cash flow to keep running their operations. When corporations and individuals lose their cash flow, they go out of business or are reorganized somehow. When the govt runs out of cash they print it up. When banks run out of cash they may or may not get bailed out one way or another. It depends on what politicians the banks own.The risk seems always to be transferred to the unwary individuals. The profits are always head to the top and loss always run to the people. With govt supposedly of, by and for the people, I like the way we have been screwing ourselves by allowing this arrangement. Great scam supported by great propaganda. We were warned by our forefathers about the banking scam and went right ahead with it anyway. They predicted all of us being slaves on the plantation we used to own. They told us how it would happen and we volunteered to be in this system. If you apply the concept of not understanding the laws or mechanism by which you ended up holding the liability, do you think you might have been swindled? Its all in the fine print. We are responsible, not them. They took advantage with the power which we gave them, and hid behind the laws we allowed them to write.
outofmage Feng
- "Which means without banks loaning to us, there weren't be enough means to trade, which means we will always pay interest on our money whether through our government, industries or home loans.
I think what you are saying is that all money creation occurs through lending at interest.
While bank credit creation certainly occurs this way, government money creation via Federal spending does not.
Federal spending issues new money into the economy by crediting accounts.
Money is a non-interest bearing debt of the Federal Government.
- "That means banks will ALWAYS make a lot of money by doing nothing, is it fare?"
Banks don't "do nothing", they, in fact, do do something & for that something there is nothing wrong with a bank earning a normal rate of return.
Vilhelmo De Okcidento false. Money spent for goods and services by the government only has interest because of the sale of bonds which Congress Chooses to pay back through taxation. This is a political choice not inherent. If Congress chose to, they could spend money into existence without selling bonds. And the bond backed government money has an extremely low interest rate, which is worth noting.
Vilhelmo De Okcidento the credit to accounts is interest free until loaned out. If the government purchases a contractor's services, the digital credit to the account is just money created. No interest is created until Congress decides to back that expense with a Treasury bond, which carries interest.
What was the point of giving free degrees to future teachers...
JUST ADDED TO MY PUBLIC PLAYLIST 'S
I wish they would have gotten into the exact numbers that the Chinese hold ... people may be surprised at how small a % of they actually hold, and how quickly it bleeds off, and who actually owns - in terms of BPS - US Credit Instruments ...
Pretty fucking aggrivating, that, in the us our system completely denies reality. What am I to do as a student?
The national debt does allow people to buy tax exemptions into the future and to store wealth in taxing power. Its not necessarily a good thing to allow unlimited stores of wealth and stores of wealth are in many ways just debt instruments on productive economy. Allowing someone a 40 year mortgage allows more total debt absorption than a 30 year mortgage. According to the same principle the more government debt , the more the top 1% can buy tax exemptions which is to say "earning interest".
As my friend, Ron, was trying to get at in the first question, the Federal Reserve is NOT the gov't, and debt is only owed to external bodies incl. the Fed reserve. It doesn't owe money on currency issued in coins or U.S. Notes. The interest rate will not be near zero forever, and then we will owe big (and the Federal reserve chooses the interest rate, not the gov't). Wray is Wrong.
Harris : my education was free, and a good investment for the govt, except that I emigrated in which case it was just a subsidy paid by the people of my country to the USA where I emigrated to 🤣
Why have government deficits been rising at the same time private sector savings have went down in America. Shouldn’t the deficits caused the household savings to go up.
It depends on the size of the government deficits compared to the amount of aggregate spending on goods and services in the economy. Apparently the aggregate spending has outstripped deficit spending.
Reform- Same provider(s), same product(s), different packaging(s).
if your countrys balance of payment is negative that means that ure currency is loosing value or ure country can purchase less goods,if it is loosing value or if it is purchasing less goods it means that the purchasing power of the citizens of the country rellay more and more in domestic production,witch means fewer goods witch means INFLATION...simple concept
Up to 01:23:57, I was horrified ... that someone is either that a) evil or b) naive
I'm glad sense started to be discussed after 01:24:00 ...
4:45 wasted on babble. Introductions should be done by the guy. I'm so and so, get on with it!
Congress self-imposing a debt ceiling is even worse than Wray suggests. Since to fuel an economy the government must deficit spend into it, over time the deficit should naturally grow and accumulate each year if you have a productive economy. So it should naturally grow without limit. The critical number is the *rate of change of the deficit*, not the absolute value (which is meaningless without historical context). So a debt ceiling effectively says, "we _want_ people to be unemployed, we _want_ less growth than sustainably possible". So deficit hawkery is worse than wrong, it is sheer impoverishing *madness*.
"the mathematics of 2000 BC were superior to todays mathematics" ... that is what Michael Hudson said ... is he affirming the so much maligned theory of prehistoric civilizations like the ones Graham Hancock and others speak about ?... because it would answer a lot of questions that were, to this day, relegated to the category of mysteries ...
No teacher messaged me recently.
-.-
"I Proclaim" I am a disciple of Michael Hudson.
Education as an asset is going to be available from the virtual classroom soon. When this happens the brick and mortar school is going to be obsolete. Can you imagine the resistance of the educational system to this? Only the very best teachers will be needed. How many "teachers" do we have that will be out of a job. Maybe we should have taken more interest in math.
Randall, the economic system is not slightly off course...were destroying the planets ecosystems, fiddling with antiquated monetary design beliefs is not going to cut it.
We are all sheep... or at least I am.
The first speaker showed us the bone with the notches and said he did not know what it was but when he followed up with the notches on wood, I imagined the bone might be a type of tally for goods.
Next speaker comes up and we find out the bone was likely for tracking moon cycles.
I listen, think about it, and if it makes sort-of sense I take it. I am a sheep because I do not know more than I am told or shown or find.
The fact remains it would be much cheaper & we would benefit form the seigniorage, if we simply produced debt-free U.S. Notes direct from Treasury instead of paying interest for our own currency.
Jump to time 00:36:00
You can only buy treasuries, that promises to pay dollars, with dollars.
Nice.
I understand the the mass amount of credit being created by the private sector banks and the burden it places on the people and the economy. Yet if government spends money on things such as war or even giving welfare isn’t that just a tax on the productive economy to pay for the unproductive economy. The money needs to go into productive things not destructive things. If the government prints money and doesn’t spend it on productive things is it not as bad as the banks doing it? Say with education if the government prints money so everyone can get an education but the education is unproductive or their are no jobs to support the education is it not hidden inflation or a tax on the rest of the economy?
Poor acoustics! 😟
The when Sheila Bair says the FDIC is underfunded --- It doesn't really matter because the govt can create the money to make the depositors whole.
When government makes more money say to pay for FDIC or any other program they make more debt and the taxpayer has to pay that debt because the bonds created to fund the new money mature and the taxpayers are the only ones who can pay for it. The public pay in real terms with the burden of that payment decreasing their ability to pay for anything else. There is no magic funding of the economy but there is a belief that some self promoting politically biased economists push (like here) to deceptive to people whom they prey on and who are unfortunately easily deceived because they are not aware of the way it operates and are drawn in by the cruel deception.
It's easier for Americans to have a confused view of debt because they see China (for example) as giving the USA goods in return for bonds (which MMTers basically say have no value, so they get goods for... free! As Mosler said 'all we owe China is a bank statement' ). This is nuts from a common sense perspective. Most countries require payment in their own currency, not in YOUR currency. As you require more Yuan to buy Chinese goods the $ depreciates relatively - with help from MMT it can soon depreciate to zero. Only reasons this has not happened is because 1) China happy to own America by taking more and more credit (for now) 2) China keeping Yuan artificially low - playing the long game - subsiding US purchases from China until US manufacturing capacity is completely dead and China owns global productive capacity.
9:45 „the federal government is like a household“
I did NOT appreciate the moderator's comments after M Hudson's presentation, saying the problems in the EMU were OVER-stated and that the eurozone is "doing rather well, for some of its components"(!!) Exactly which components would that be? Appalling.
If one man chops off his entire hand, and another man only chops off one of his fingers, I wouldn't praise the latter for doing "rather well".
He’s wrong. Central banks do create private wealth with its operations. They can lower rates thus expanding credit for asset purchases. Asset purchases push asset prices up. Those who were holding assets prior to the fed operations become wealthier as their assets are valued higher. They can tap this wealth through more collateralization of their assets or asset sales. The former is more common in the housing market.
That is professor wry is wrong about that part.
They got to get out more :) !
But the interest free money lies on the "issue of money" liability takes only 3% of the whole money supply. 97% of them are created by the private banks, and need interest payment.
Hudson again wrong at 1.13 when he says equity is on the liabilities side of the balance sheet. He fails to understand that someone's liabilty is another's asset because that is the way pure financial assets exist. It cannot exist any other way.
so the central bankers need to cancel all governments and smaller banks debt and then those intuitions can cancel everyone below them debts
Not the debts per se, but the interest on the loans.