@@aaronfreeman5264 Unless the buyer buys the house outright the buyer has a mortgage. A mortgage is a liability for the buyer not an asset. However the mortgage ( in the form of mortgage payments ) does become an asset to the bank that has lent the money. but, Even if the buyer buys outright the house only becomes an asset after the bank that foreclosed on the original mortgage has sold its “asset” to the buyer.
I only had $0.0000008 in an account, but I had a talk with the branch manager, turned the statement upside down, and she agreed and fixed the computer, I'm a multimillionaire now. It's all about communication skills.
@@thedave7760 Assuming you mean who owns how many dollars to whom, the first question has to be how did these dollars come in to existence in the first place? How can a dollar come into existence without somebody owing somebody something? That has to be fully understood before this topic can be rationally discussed.
A corporation creates the value that money is a unit of, are you really this stupid? Our current monetary system literally turned US dollars into US stock shares minus the owner rights.
Any system can work if you have vast amounts of oil wealth. Saudi Arabia is a dictatorship or a kingdom depending on your perspective and they have a pretty good quality of life.
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@@danparish1344 Depending on your class. Outsiders don't find it so good.
@@willnitschke If there was Person A who started out as a scammer, then it is fair to scam him. In this case, people who supported Taxation prior to learning its MMT role.
I’m 70 years old and retired. I’ve become more cynical and listening to things like MMT over the past years. The main reason the government doesn’t have to worry about where the money comes from. Is they can always take it. They have law enforcement and jails to put you in if you don’t give the government the money.
it used to be working coz china and japan were buying up all the excess bond. create a cheap cost of borrowing and avoiding high inflation. but now no foreign country buying up the excess bond, hence it will cost inflation.
This is 100% correct! Even worse these people believe in Keynesian economics but they only follow the part about deficit spending during a recession. They will never stop spending so we will never have a baseline on the economy to know if we should be running deficits or surpluses.
@@Richest_Person_in_the_World No, a fiscal surplus can be used to pay down the national debt. But you are correct if we didn't have 35 trillion in debt.
@@Richest_Person_in_the_World What you say is undoubtedly true and bad for you, but this is supposed to be from the government's POV. Whoa - that rhymed!
I knew that lady was nuts when she used that "6 or 9" analogy. Someone drew that 6 or 9, so someone knows which one it is, therefore there is an objective right and wrong answer. Subjective morality is poison to ethics. Didn't know subjective economy was a thing.
@@theGefilteFist "Subjective: characteristic of or belonging to reality as perceived rather than as independent of mind". Price is subjective. Value is not. The circumstances in which an item is presented determine if it has value or not. Gold has objectively no value, outside of computer chipping and electronics. Its price is based entirely on subjective assumption rather than objective utility like steel or gasoline.
@@1krani price is literally printed on the price tag (where applicable). Everyone has to decide for themselves if the value they get out of something is worth the price cuz the value only exists in their heads
@@vulgoalias4050 For morality to be subjective, one would have to believe that certain ideas or actions are not inherently hypocritical or self-destructive. Rape springs to mind.
@@coolbanana165 Then it's a description, not a theory. Theories should allow for prediction, and description just says how things are, and not how they will be or should be. Not that description aren't useful, but they're useful in a different way than theories.
She talks about not being in full employment and that we have the capacity to rebuild the infrastructure. But, so what if we have unemployed people. Do they know how to use a hammer, or build a train track, or lay concrete?
Frankly speaking, in all likelihood yes, they can. Employment in Construction seems to vary most much more than average with recessions. Many recessions are primarily a result of a building collapse, 2007, Savings and Loans Crisis, the Great Depression, etc. But more to the point, you are correct that not every unemployment individual will end up working in construction. But I do support the concept of a Guaranteed Employment scheme. I would suggest keeping the federal government, which responds slowly and bluntly, largely out of the operation. Instead I would have a federally funded program wherein Municipal governments and Charities can pay people minimum wage for 8 hours a day 5 days a week. I would also open it up to Manufacturing companies to cover up to 6 months of training, although half the cost would have to be repaid if the trainee wasn't employed there a year later. Smaller and generally financially strained entities will react much more quickly and efficiently to the available labour pool. They aren't stealing jobs from the private sector because of the limits on hours available and wage. But it would keep employment up in a recession while getting things done.
or want to? full employment is only possible when you remove welfare (besides disability) i work in construction management in DC area which have a hiring law called First Source. we have to hire DC residents to fill our jobsites in DC that receive public money. the problem is many people would rather not work and live on public assistance, than sweat on jobsites and earn 20% more. welfare creates generational poverty and rob them of motivation to reach their potential. it is insidious and a tragedy
Listening to her speak is like listening to a teenager talk about credit cards. "Yeah, you just use the piece of plastic and it pays for whatever you want! its free money!"
@@Richest_Person_in_the_World What do you think happens when we run a deficit? We raise the national debt. If we default on that debt, it can be catastrophic to the entire country.
@@novacorponlinewe don't default on the debt, we print more money, which can or cannot cause inflation depending on where the money goes and what is available and needed in the economy
The Richest Person In The World is right; don't insult teenagers, by comparing them to Kelton. At least a teenager will bear the cost of their debts themselves, or maybe with their parents' help. The government makes 7 billion innocent 3rd parties pay for their handouts to weapons manufacturers and government contractors and bankers.
@@novacorponline If the government loads my account with $1,000,000 yes that is public debt now, but it's my asset as a citizen. Therefore you should rejoice at the realization that the deficit clock is your savings clock
97% of our currency is created by commercial banks. When a bank issues a loan, it creates new money digitally and charges interest on it. For a 30-year mortgage, you’d work about 15 years to pay off the interest alone, all for money created with a few keystrokes. Let that reality sink in, and you’ll begin to understand the flaws in our financial system.
First, don't tell the MMT crowd that private commercial banks create most of the currency, as they all think 100% of it is created by their all powerful government. 😉 Secondly, what is the alternative to loaning money? Nobody is going to give you their savings for free. People aren't stupid. Are we supposed to rent for 60 years and buy our home for cash at age 70?
@@charlesloucks1840 The people who 'benefit' from MMT are the wealthy. The people who are screwed by it the most, what I call the "useful idiots of MMT" are the bottom tiers.
It’s actually not necessarily bad for laborers. A devalued dollar means labor can be more competitive at home in the USA. We’ll see a lot of factories spring up at home rather than manufacture everything overseas.
An important point for anyone to understand is that money itself is not wealth; it's merely a tool, a medium of exchange for goods and services. A good currency, like gold or silver, will also have other properties and can be a store of wealth, but ultimately, it's the exchange function that's the most important. Wealth is actual goods, services, and resources utilized for goods and services. It should be obvious that merely printing more money not only doesn't create new wealth in the form of goods and services, it dilutes the rest of the currency in circulation, devaluing the currency and causing price inflation. Borrowing money is trickier, especially when the government's doing it. Still, like any borrower, the government either has to pay it back or default on the loan. They often get a pass because it's the government borrowing the money, but they shouldn't. The money government borrows has to come from somewhere, and the question is where would the money have gone if government hadn't borrowed it? Either way, printing or borrowing, the government isn't "stimulating" the economy into creating more goods and services, it is merely redirecting the economy into whatever industries or sectors they think need 'stimulating'. The government can never run out of money, but the more that they borrow or print, the more bad consequences they create. That's why it's not "free" money! Stephanie Kelton is wrong to say that it would be inflationary for government to spend only during "full employment". How many concrete workers and architects does she think are unemployed? And government spending rarely targets specific groups of people in such a way. She's just expecting, or perhaps *hoping* that those unemployed people will become employed due to government spending. This is reckless thinking when you can't explain how it will happen.
MMT'ers will respond by noting the difference between the money supply and the money supply as measured against economic output. But, 1-2% inflation is still inflation, and the Federal Reserve understood this when their inflation target used to be 0%. Heck, Hanke says the target should still be 0%; it's a fair issue to debate. But even if there are some MMT'ers who want 0% inflation, they are still ignoring the counter-factual inflation which comes in the form of central banks preventing slight deflation----technological/growth deflation, which is OBVIOUSLY good deflation.
@@macsnafu and that is only credit deflation, particularly when wages fall more. But there's nothing bad in itself with falling prices, because a growing economy brings prices down, particularly in terms of our wages. That's capitalism
The problem with MMT is that they believe the relationship between inflation and employment is a step function. Everything else is main stream econ. Your post assumes people are rational, but they change their work and investment patterns based on feelings. The government can change people’s behavior (feelings) so they work more and make more stuff.
Mac Look up goldsilver money or Mike Maloney. He does have some good videos on money. There’s a reason and historical reason he always says gold or silver is money but the U.S. dollar today is fiat. Currency doesn’t preserve purchasing power. Money has like five key tenets that a good money must have and preserving purchase power is one of those. You’re right. If gold is found in mass quantities it’s inflationary. Now gold is a good or product in itself as it’s more rare. So even if it wasn’t money it’s worth something unless if you’re a Native American or some tribe using other things for barter. Some tribes used gold for barter but some used sea shells etc. and Polynesians on one island rowed 200 miles to another island to bring back a rock and that rock was considered money. So ya people should distinguish between money and currency.
Creating more money is necessary when your real economy is growing. More cash is needed to complete the increased growth in transactions. But supporters of MMT mistakenly believe this relationship also works the other way around. That if you increase the amount of cash circulating, this automatically increases economic activity. In real life this doesn't work. What happens is that sellers of non-discretionary goods elevate their prices rather than creating more goods and services. There is no growth in real economic activity, just inflated prices.
With respect, i agree completely with the second statement you made, but i disagree with the first. Why must monetary expansion match real growth? Surely, deflation is THE point of an economy? Who cares if my salary is decreasing in the actual figure, if my purchasing power remains the same, because goods are becoming cheaper?
What you're describing in those sellers of non-discretionary goods are monopolies. Break up the monopolies and prices will start to come down as suppliers compete for business.
@@garethbarry3825 I agree with you, but I accept Milton’s approach of “at least don’t inflate the currency” instead of trying to argue Schiff’s position of allow it to deflate.
@@charlesloucks1840 Great idea, except private sector monopolies don't exist, only government ones. I can't shop around to get a driving license renewal for a better price.
@@jsbrads1 It's not clear to me that Schiff's position is wrong and you presented no arguments as to why he is wrong. Pragmatically, deflation is undesirable primarily because it would cause the government to collapse.
1. To create demand for that currency 2. Tax can be used to control inflation 3. Tax can be used to create more equality 4. To exercise nation-state power, monopoly of violence and taxation (death & taxes) PS. I'm not MMT supporter!
@@pnc1358 Tax cannot be used to control inflation. This MMT brain fart is among the dumbest offered by the ideology. If poor people are struggling to pay rent or buy food, you can't just raise taxes on them so they become homeless and starve to death. Technically, that will 'fix' the inflation problem, sure. By creating a lot of dead people. Or you could raise taxes on Corporations instead, which will be passed through to consumers (as all operating costs must be), and this will cause even worse inflation.
MMT is so full of holes it's hard to believe it's still taken seriously, especially considering the inflation we've seen across the world since that TED talk was given.
Techincally its not inflation. It's a price shock, triggered by the ukrainian war and the loss of russian gas from the world economy. Inflation happens when the price of everything, including wages goes up in a spiral like in the 70s.
This is the first time I've heard MMT described by a proponent as a matter of perspective treating deficit spending like double entry bookkeeping. And it's still stupid...
Well, the science of it is 100% accurate. The implications of using it is a different question. That's why you should never listen to economist who don't understand money and banking, including this clown economist.
@@Richest_Person_in_the_World Oh look, anonymous nitwit babbling shit on the intertubes pretends to be smarter than a guy who has written whole books on topics he doesn't remotely understand. 😂
@@Richest_Person_in_the_World Imagine an anonymous half wit on the intertubes who doesn't understand what debits and credits are, or who thinks Yugoslavia currently enjoys single digit inflation, who then goes on to cluelessly attack a PhD who has written whole books on topics he doesn't begin to grasp...
This feels like your projecting your bias onto what people say. It is literally true that the US government, as the sovereign issuer of money, is able to create and spend money on whatever it wishes. But that’s not the whole story. Every MMT’er, Kelton included, caveats that with the limit being the inflationary pressure of that spending. Don’t let bias hold you back from steal manning the arguments of others.
@@timgwallisSo how do we just create all the money we need for free healthcare, college, etc etc and deal with the inflation? That’s the missing piece of the puzzle. Monetary systems can only handle so much inflationary growth at a time.
@@januarysson5633 totally agree with the last part of your statement. However I disagree that the “how to handle” part is missing. MMT’ers make it clear that the means to deal with inflation is taxation. Creating new money increases the money supply in circulation, taxation reduces the money supply in circulation. Personally I favor a progress consumption tax. The more you spend, the higher the tax rate you pay. With a digital dollar the rates could be programmatically set to ensure the money supply in circulation new grows faster than 2% annually.
January In the past miners of silver and gold brought metals to mints and the mints made coin money that would be given to the miner. ZERO NEW DEBT is made when mints would convert metal into coins. Today fiat currency has made the system so when a new mortgage is made new dollars are also made. That is a totally different system.
All of the interest paid on the National Debt does go to someone as Stephanie Kelton stated. This issue is it is govt. money paid that does not come back into the system in fair taxes or production. For the system to work that has to be the case.
That's just one major hole in her "logic". A lot of that debt is paid to foreigners, such as the Chinese. The bigger hole in her "logic" is she assumes all government debt balances to assets on the other side of the ledger. It doesn't. Entitlements are expenses, not assets.
@ Entitlements like Social Security don’t add to the National Debt. SS is still in the black so no debt. Incurred. Also, SS recipients spend it back into the system which ends up working for all. Basically put, the money stays at work and causes no debt. Interest paid to China on the other hand is production lost.
@orangeofmars2835 entitlements don't add to the national debt. 😅🤣😂 Consumption = production 😅🤣😍 We should all be on welfare bro. The more we consume the richer we are! 'Cause "the money's at work". The more I max out my credit card the wealthier i become. 🤣
You think you're calling their bluff, but MMTers, Thomas Pikkety and others have said that taxes should be understood as a social engineering tool rather than a finance tool. The point of taxes is to punish you for behaviors the regime doesn't like, and to control the flow of resources so that wealth is distributed according to what the regime thinks people deserve instead of according to what they earn through voluntary exchange.
She's dishonest. She was telling us that inflation is the worry, and when it got here in 2021/2022 she told us that inflation was transitory. That's an ad hoc excuse because she knows inflation means there should be no more handouts. Having the reserve currency isn't a difference in kind, it's just a difference in the amount of time the U.S. Government has. Guess what happens when you print too much? Well, then you don't have the reserve currency anymore! No duh
Yes, an industrious counterfeiter will never run out of money. But a big enough counterfeiting operation can lower the value of everyone else's money to finance itself. Even if it's spending its funny money on roads and bridges, it is impoverishing citizens by reducing the value of their holdings in money. Am I missing something? If printing money is harmless, why shouldn't everyone do it?
The trick is that "the private sector" includes the entire economy minus the government. So of course all government spending goes to the private sector, because that's the only other party to trade in this simplified model. Nevermind the massive wealth transfer from the average person to weapons manufacturers, bankers, government contractors, bureaucrats, politicians' private stock portfolios, welfare recipients, etc. That's all technically part of "the private sector."
Wouldn't it occur to the MMT proponents that, if they "only" have to monitor inflation, at the very least, the debt and deficit are metrics you'd use as early indicators of when you're about to enter inflationary levels of spending? IOW, even if you try look at it from their perverse perspective, the debt and deficit should still be very meaningful (and very distressing at current levels).
Stephanie Kelton said "Just as a 6 becomes a 9 when looked at from a different angle..." THAT is the crux of the problem of MMT. A 6 NEVER becomes a 9, no matter which angle you look at it from.
She should’ve explained why the government cares so much about collecting my taxes if they can just print all the money needed for high speed rail, free housing, and foreign wars.
@@Richest_Person_in_the_World Bit didn’t those dollars I sent the IRS have value back when they were in my wallet? How does me giving them to the government give them value?
@@theybrokemywatchThe fact that They (dollars) are the thing which saves you from tax punishments. As in "Give us $100 or we'll jail you," you react: "Whew thank god I do have $100 here."
I had a discussion with some friends who seemed to want to champion MMT. What they failed to recognize is that inflation is the real killer of MMT, and you can't print your way out of it. The latest round of money printing by the government, where they increased the money supply to the tune of 30%, led to approximately 20% cumulative inflation from the time they started printing the money. Not good at all.
Hello. Have your friends learn Quantitative Monetary Theory. MV=PY. What MMT is stating is that instead of issuing Treasuries to be purchased by various investors, the Fed can just buy all of them instead of the fraction they do now. This would create an increase in the money supply multiple times over. Once they recognize that and understand the Quantitative Monetary Theory, they will get it. That is unless they like hyperinflation. Assuming friends aren't morons though. Lol
@@imrangul6750 MMT argues that the value of a Fiat currency is derived from the acceptance of the currency in payment of taxes. Consider how long you think the USD would last if the IRS switched to only accepting Pesos. Taxes drive demand for a Fiat currency. They are essential to it's function. The stance MMT takes is that because of this, it's okay to spend more USD in a given year than it collects in taxes, as people will save some for future tax payments or to buy things from someone who will have to pay taxes. And as the economy grows in size, ideally due to rapid growth but probably due to inflation, the amount expected to be collected in the future grows, and so more overspending can occur as more money will be saved.
@@scottcincinnatikid9804 No, what MMT is arguing is that when you increase M, you get a rise in P and/or Q. And that you should focus spending on sectors that raise Q. This is widely accepted in QMT, banks increase M1 and M2 by issuing loans, and the productivity of those loans increases Q enough to compensate. But I agree they can't just liquidate all outstanding debt. I would say selling government debt will always be an important anti inflationary tool, in the same way the Fed pays interest on reserve balances. I would like to see public banking with the Fed, so that people can get the same interest rate on savings as commerical banks do. Or likely, lower rates to take more money out of the economy.
Bond holders, primarily. Foreign sovereigns, pension funds, individual investors, etc. If they don't honour their debts, the US economy would be destroyed over night. Hence why over 1 trillion is now being funneled into debt servicing, away from schools, hospitals, infrastructure, etc. Yeah, so the debt load is pretty devastating right now. (To consider how bad it is, the US Federal government only collects 4.5 trillion in taxes. In other words, about 25% of all tax dollars are sent elsewhere, instead of being used productively. And it's rapidly getting even worse.) Thanks for asking.
@@willnitschkeYou are so clueless lol Supposing 28T is owed to bondholders and another 28 is needed for hospitals. What's to stop Jerome Powell from just printing 56 trillion. So there is no Crowding Out as you claimed
@@Richest_Person_in_the_World *You are so clueless lol* No I'm not, you're the idiot in this exchange. *Supposing 28T is owed to bondholders and another 28 is needed for hospitals. What's to stop Jerome Powell from just printing 56 trillion.* Hyper inflation would result, assuming the 56 trillion was pumped into the economy, Professor Sh*t For Brains.
China already pushed back on accepting new US debt, German bonds pay interest lower than the rate of inflation. Interest rates rose on our debt and if we don’t get our spending under control, our government can collapse. Inflation can run out of control and the flow of the economy can break. Retirees won’t be able to pay for medicine, housing, food… Reality can foreclose the US.
Simple thing to remember, if you hear the terms "deficit", "print money", "borrow", "quantitative eas" these are the same things at government level, and it all leads to the same thing: inflation.
@@Richest_Person_in_the_World The price level is 30% higher than 3 years ago. Thanks for asking. If inflation is 50% for 1 year, then everyone is twice as poor. Even if the rate of change _then_ drops to zero, people are still twice as poor, knucklehead.
A government could in theory buy everything. Society may collapse around it, but the government, if backed by a sufficiently capable military, would not. What's not to like?
Under a fiat currency the point of the dollar (or euro etc) is to pay taxes. If the federal government said "We will no longer accept USD for paying taxes, from now on only Mexican Pasos will be accepted" people would stop usong the dollar very quickly, and move to the new currency that they cam use to pay thoer taxes and avoid punishment for failing to do so. MMT is saying its okay to spend more of these than you are accepting in a given year, because you are collecting enough to maintain a demand in the market for them.
@@neolithictransitrevolution427 No it isn't. That's just a retarded line of Molser scripture. 😅 The point of any currency (whether it's fiat or not is irrelevant) is to efficiently facilitate exchange. BTW, I can hold my entire net worth in Swiss Francs, and if I was a US citizen, and had some tax to pay, I'd just transfer my Swiss Francs using telegraphic transfer to pay the bill. This is all sooooooooo stupid. 😂
@@neolithictransitrevolution427 This is all so stupid. I can keep all my currency units in Swiss Franc's and if I'm obligated to pay US taxes, do a telegraphic transfer, in Franc's, to pay that. Everything MMT "says" is nonsensical, hence irrelevant. Demand for a currency is derived from the fact that dollar denominated debts are loaned and leveraged. There is always more leveraged debt than dollars. This is "OK" until there is an unwind and then a liquidity and/or collateral crisis follows. Printing more dollars does not fix anything, it makes everything worse.
It's shocking. MMT is not that complicated, though it does uproot a lot of concepts we grew up with. Everyone first encountered paper currency at age 3
@@willnitschke good luck learning about anything worth learning from a TED talk video, much less from a commentary video. As a description of the current macroeconomic system we live in, MMT is spot on. Anyone who says otherwise is referring to a system that is a century old, like the guy in beard is, or just referring to a fantasy island economy.
The general public now accepts all other forms of taxation as legitimate means of operating government. I’m sure the general public will accept direct inflationary money printing as a legitimate government operation in the near future as well.
I wonder where the data came from to correlate deficit to the surplus. How do we know there wouldn't still be a surplus without the deficit? Considering the government is very inefficient, her graph pretends its a 1:1 correlation. Did she factor in the surplus there would of been if there wasn't inflation from deficits from increasing the money supply?
The main problem that is not addressed is the fact that managing inflation of a massive system is like trying to dock the Seawise Giant while she’s at full speed! That level of accuracy and control is not easy to attain in a moving economy!!! 😅
Which is why there should be no attempt to 'manage' it, because it can't be done anyway. The free market should price the cost of money. The only reason why the free market is hindered from doing that most of the time, is because half wits control the printing press and introduce distortions all the time.
@@willnitschke But the problem with the free market is it creates excess inequality; which leads to revolutions. How do you suppose the free market can create a stable society under modern expectations of the Democratic population?
@@RadicalModeration The free market doesn't do that, your government does. 😅 Here is an example, the Fed engages in QE. This is a massive asset purchasing program, which causes the price of assets to rise. Who owns most of the assets? Rich people, of course. So the rich get richer. But all in the name of helping the middle class, of course. 😉 *How do you suppose the free market can create a stable society under modern expectations of the Democratic population?* By having more of it, and less government 'help'.
BTW, I don't see what you follow-on comment (assertion) has to do with your original point about how the government has a hard time managing inflation. It's of course understandable that it would, as it's the primary producer of inflation to begin with.
Is there a limiting principle? Ask yourself: Would it then be fine to run $100 trillion deficit every year? How about a quadrillion? If it really is a perpetual motion machine, it’s all benefit at no cost.
@@VeniVidiVid no one is arguing there are no limits. Banks borrow and use that to leverage investments, and increase the money supply while doing so by making loans. But because they make productive investments, this is not inflationary. The point is only that the government can create money to make an investment or fund a program, and the economic growth will expand the tax base enough to collect the created money. That doesn't mean there is an infinite number of productive spending activities. It doesn't mean that the returns will fully cover the program. It just means that if economic activity and the tax base expand because of the spending, the increased demand for dollars can balance out the money creation. Again, as banks do when making loans. The dialogue around MMT is mainly to push the idea that we should focus more on the productivity of our spending programs rather than looking at the deficit or surplus in a tax and spending plan.
"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless" -Thomas Jefferson
Where does he think the $100 dollars came from for the robber to steal? Somebody had to print it didn't they? If the Gov didn't print money, he wouldn't have his $100 in the first place.
Except when the red ink gets put, not into black ink, but cronies, war and losing enterprise (eg Solyndra,etc). She’s making a grandiose assumption that “government” makes perfect, unbiased decisions. History and current experience suggest otherwise. Especially the more removed spending is from accountability.
In the discussion of full employment, do economists ever take into account the mismatch between the job vacancies employers want filled and the pool of workers who are qualified to perform those jobs? The Army only needs a few tens of thousands of recruits annually. However, 71% of youth do not qualify for military service because of obesity, drugs, physical and mental health problems, misconduct, and aptitude. Given the casual effort of our public education systems, there are probably no categories of employment where corresponding labor resources are readily available.
@@macsnafu I mean in cuba they train doctors by the tens or hundreds of thousands but sure you can't do if if you want to keep doctors in short supply and medical cost so expensive that it is the leading cause of personal bankruptcy . Not a person in this comment section understand money or economics and that's how you get to the point where you claim not teaching and educating people who can't afford it will lead to a shortage of relevant skills and pretend that's not just a funny commentry on capitalist extraction.
I have viewed many of Murphy's criticisms of MMT. They are all presented in a manner that one would believe that we are still under the Gold Standard. He offers no good explanations because he reverts right to that era, where Fiat currency did not exist and we still had commodity backed money which is no longer true. He can't seem to accept the fact that our currency has value because our government mandates it and that is good enough for almost all of us. Under our fiat system we have to accept this because nothing else has been proven to be better certainly not commodity backed money. If we were the only country with fiat money and the rest of the world still backed their currency with a commodity like gold, Murphy's argument might have more value. But the fact is that the rest of the world is on the same fiat system we use here. Listen to him and count the number of times he compares government finance to our personal finance or the finances of corporations. None of those arguments are legitimate under our current fiat system.
And he uses patently wrong examples. "Oh it's the same with my debit card when I buy spinach. If my account is empty, according to Mosler I can just take it." Facepalms galore
Your attempts at criticism are laughably ignorant, sorry. Murphy has written books on money mechanics. People like you wouldn't even get past chapter 1. 😂
Google will actually have to pay back its “debts”. For the federal government’s “debt”, all they owe us is not to take our heads if we pay our taxes. Come on guys.
Bob, how can you think the government owes anyone the amount of the deficit? It’s simply an accounting of how much they have spent into the economy that hasn’t been taxed back out.
@@murp0443It's amazing how people don't grasp that simple thing. "Look, the $5 in your pocket is yours!" -"When are they gonna pay me that $5 tho? And where dey gun git da money?"
@@murp0443 *Bob, how can you think the government owes anyone the amount of the deficit?* Because the debt is owed typically as bonds, which pay interest. And the government has to repay the principle and interest in full, sh*t for brains. 😂
Schiff definitely does not support MMT and doesn't acknowledge anything good about it. Is why lije many others who have staked out positions in the past and resist anything new that might be better.
@@tonysu8860Yeah he opposes it, but also Gets the part where USD is a tax credit. So it is actually bizarre that Schiff as a Dollar Hater actually thinks there "more to it" than what MMT says
We run this experiment in NZ. The results are in and it has been a disaster. Access to cheap money at 0.25% OCR through the 2020 Quantitive Easing drove up house prices 30% by the end of 2021. It also drove up prices everywhere else within economy especially raw materials first as my encounters in the market place showed by the end of 2021. Now this timeline is interesting for one good particular reason as it is Milton Friedman’s predicted inflationary timeline taking 18 months to two years to really show itself. It was spot on and things have been a struggle ever since. Fortunately I as able to fix my rate for a few years in mid 21 as I saw it coming. We have been dealing with inflation ever since since at the time they called it “transitory”. And now the vast majority of it is local inflation. I see MMT as the height of government corruption as far as I am concerned. The way our government here used excuses like “child poverty” and “climate change” to just waste money and throw it at people to buy votes. Covid also, was not an issue here until 2022 and by then had mutated to a milder form. Government here employed thousands of people more on its coercion efforts. I would think it was a bad dream if I had not been awake.
I don't know if MMT is correct or not but your guest Bob Murphy immediately discredits himself with his initial analogy of Google issuing bonds. One of the fundamental parts of MMT is that when the government issues bonds it issues bonds in its own currency. The government also controls the currency so it can also print money to cover its debts. By printing money the government could cause inflation. That's why there's an emphasis on controlling inflation in MMT. In MMT you control inflation by raising taxes and raising interest rates. The closest comparison for a corporation is probably Google issuing more stock. Google controls its stock so it can always issue more stock, but by issuing that stock it devalues the stock of the existing stockholders. So either your guest just doesn't know what he's talking about or he's being intentionally misleading. I find in a lot of these conversations about MMT, the people who are trying to discredit it don't really take it seriously enough to actually study it so they can refute it.
*That's why there's an emphasis on controlling inflation in MMT. In MMT you control inflation by raising taxes and raising interest rates.* No there isn't... So the "fix" for the inflation that has crushed poor people in the US in recent years was to raise their taxes? Do they even pay taxes? Or is the fix to raise taxes on the productive segments of the economy and cause a depression? MMT theology is completely moronic... 😅🤣😂
@@willnitschke we don't have an administration that is practicing MMT right now. So the poor and middle class are just suffering under the current system. If you really want to understand MMT then I suggest you read Stephanie kelton's the deficit myth. Like I mentioned before, I don't know if the theory holds up. I think there are a lot of questions around if the government would actually respond if inflation got out of control under MMT. But what I see is a lot of lazy responses to why MMT wouldn't work. Especially with so much dissatisfaction with the current system.
@@klf9161 I've looked at. It's nonsense. I have better uses of my time. This stuff is ideology. I'd ask you to ask yourself, why are you taking seriously the incoherent writings of a self published crank (Mosler) and grifters like Stephanie Kelton who is primarily out there promoting this stuff to achieve power and prestige. Now Kelton is no fool, but she's been serially wrong about the economic consequences of her ideas. What's happened in 2021-24 essentially refutes her.
At around 3:45 Bob is saying "Fine, so she claims govt debt is our asset! But wait, how do they intend to pay it to us!" Not understanding that it's already in your pocket 🤦♀️
Professor Sh*t For Brains, just because he notes what she claims, it doesn't follow that he agrees with it, obviously. Well, that's obvious to everyone except you.
The real issue is commercial banks create money out of thin air and then charge interest on it lot of people don't realize this they think Banks loan out customers deposits but that's not how it works it's the craziest system. Banks should be 100% full reserve banking meaning they can't loan out the money from deposits now there's other ways that they can loan out money but they will only have to loan out from funds and certain savings accounts credit for that. Then what we could do is have the government print the money they need to run the office as a percentage of GDP maybe there'd have to be a lot of discussion on this but at that point if the government's going to print what they need we don't have to take out any more loans and pay interest on those loans then we could get rid of the Federal reserve we could get rid of the IRS and it would be a streamline good system. And then the money that is print into circulation by the government for roads or bridges or government pay or whatever they need then that money would be the inflation that you would see and then that inflation would be the tax but there would be to be some heavy constraints put on exactly how much money they could print each year. And since they can only print so much per year they should also Congress should make it illegal for them to go ahead and sell bonds or treasury bonds so if they can't live within their means they can't just go and go oh you know we got a crisis or this happened or that happen we need to print money cuz there's always some crisis that they're having to print money for so that's going to come back to Congress and it should be on Congress not the Federal reserve
*The real issue is commercial banks create money out of thin air and then charge interest on it lot of people don't realize this they think Banks loan out customers deposits but that's not how it works it's the craziest system.* Why is it "crazy" ? This is an assertion, not an argument. And why should the cost of money be free anyway? Loaning money involves risk. Why should risk not be rewarded? Isn't expecting free money, more reasonably, "crazy" ? *Banks should be 100% full reserve banking meaning they can't loan out the money from deposits now there's other ways that they can loan out money but they will only have to loan out from funds and certain savings accounts credit for that.* Why? *Then what we could do is have the government print the money they need to run the office as a percentage of GDP* And if there is an economic crisis and GDP shrinks and there is a lack of liquidity in the system, and we're heading into Great Depression 2.0, then the governments hands are tied, and it can't actually react in the _one case_ where it might actually be able to do something useful, correct?
@@JohnDaniels Unfortunately for you, you don't get to decide what the facts are. Now you can _argue your case_ but since you've failed to do that, my observations stand, as you're unable to refute it.
She already lost me right at the beginning, a six is still a six and a nine remains a nine no matter what angle you look at it. Just because you look at a six upside down, does not make it a nine, that is not how maths works, it the same way that having a 80085 on your calculator does not suddenly give you boobs. A trick of the mind does not suddenly represent reality. Try is with actual real things, try looking at 6 cows at a different angle and see if you magically get 9, if you claim that people would call you crazy yet some people think MMT is sane.
@@theBear89451 The person who actually spells out the right number, whatever the number is, a six CAN NOT be a 9 at the same time, that is a contradiction. It can either be a 6 or a 9, not matter what angle you look at it from, but not both. The angle you view it from is completely irrelevant to whether a 6 is a 6 or a 9 If one is stating otherwise, they are at best performing voodo or at worst they are grifting, but they are NOT speaking truth. If type a 6 on your laptop, and then turn the display around so it now looks like a 9, does that make it a 9? Of course not, its still a 6, you just have the display upside down. The computer will still interpret it as a 6, if you ad 1 to it you will get 7 and NOT 11 !!! And the truth is, MMT is BS! They are just Grifters trying to confuse people with a economic sleight of hand (i.e. they are pretending that a 6 is a upside down 9, when it never was), its just designed to confuse people.
Abraham Lincoln once posed the question: 'If you call a dog's tail a leg, how many legs does it have? ' and then answered his own query: 'Four, because calling a tail a leg doesn't make it one,'
The TED speaker is flat wrong, but is also deceptively clever and 100% correct. Flat wrong about large Deficits being productive (scale matters here). Correct about concern about inflation. But implicitly the speaker is saying that deficits should be financed through higher taxes. That’s one way to do it, of course, and it results in a massive productivity drain on the economy. Politically, because of the scale of the deficit, it has to be addressed with economic growth (low taxes), some modest fiscal restraint given our constitutional republic and inability to address entitlement programs, and price changes that are below the rate of economic growth, i.e. real growth must be positive. The USA does have the benefit of being the reserve currency for the world and there is nothing on the horizon currently to replace it. This actually helps the U.S. manage the problem.
@@johndelia9408 Not her, but Warren Mosler (arguably the founder of MMT) has a debate on TH-cam against Bob Murphy. It's very good and a much better discussion around the merits and flaws.
3:40 Absolutely amazing how Bob Murphy still doesn't get it. MMT explains that if the government "owes" $10,000 that is just the other side of your $10,000 checking account. But Murphy shouts: "And HOW do they plan to pay us then??" 🤦♀️
MMT doesn't "explain" anything. It's just absurd Statist theology. If the government goes into debt to issue food stamps, there is no asset to balance the debt. The poo in the toilet the next day, is not an asset that can zero the debt. This stuff is sooooooooooo stupid. 😅🤣😂
@@Richest_Person_in_the_World the government doesnt need to be in debt for me to get paid tho lol. there's a neat thing called a bond, and it's similar to holding stock in a company. The company doesn't need to go into debt to pay its workers.
MMT means that the govt limit on spending is inflation effects, not budgets and debt. BUT, inflation is a tax on the poor, inequality grows with each fiscal stimulus. AND, the people have to believe that spending by fiscal policy is helping people more effectively than they can help themselves. Insanity.
No, the issue is that the government created demand for fiat, by imposing taxes in fiat. Therefore it has to make sure there are sufficient amounts of currency to cover the liability they legislated
Correct, MMT is essentially a flat tax on everyone, so the "poor" pay in equal measure to the wealthy. Given that the definition of "money printing" is creation of inflation, when MMTers claims inflation is a limit, the actual limit is the level of inflation the public will tolerate. What is most curious about MMT ideology is that it's typically championed by Leftist types, although they are the very people being screwed by it. I would therefore speculate Leftism is a marker of low intelligence.
There is so much straw manning in this conversation from Bob Murphy. You should really get Stephanie Kelton on. That would be a great episode. A remember watching a debate years ago between Bob Murphy and a MMT proponent and Bob Murphy lost badly. It's like his neural pathways are so hardwired to see the world in a certain way that he doesn't have the mental agility to entertain any other perspective. It just doesn't compute for him. I remember when I came across MMT for the first time after I had been wrestling to make sense of quantitative easing after the 2008 financial crisis. Using an MMT lens suddenly everything makes sense once you properly understand it, and you can't understand it listening to a second hand critique. Of course MMT economists can be wrong. They can make misjudgements like anyone else. But they do have the right framework for understanding how modern money works and not having that understanding can lead to big mistakes in policy making.
Totally agree, but with respect to this video and countless others on the internet. The world would be such a better place - and people better informed - if there was more healthy debate, rather than one side poo pooing the other and vice versa. So I vote for inviting Stephanie onto the show.
Hello. I have to say that you are making a big mistake if you think they the proponents of MMT have a good understanding of the framework of modern money. Refer to my comment made in main chat. In essence they ignore the second side of the creation on money on the banks' Balance Sheet. Thanks
The only thing misleading here is your intentional misrepresentation of MMT. You clipped the most counterintuitive points of MMT and cut out the parts where she explained what she meant. You said there's "nothing special" about the government compared to Apple. Yes there is! The United States is the issuer of the USD. USD is to the government as United Airlines flight miles are to United Airlines. If United Airlines dumps flight miles on into their market, it would reduce the value of the points only if United runs out of seats to sell. The number of planes they have is the limiting factor. This would equate to productive utility in the US economy. I'm not holding my breath given the other comments in this thread, but I'd encourage your viewers to be more critical and learn MMT from actual modern monetary theorists.
The United States does not issue USD. The federal reserve does and it is not publicly owned nor does it provide a reserve. How can people claiming to understand economics not get this?
Recessions are part of the economic cycle, all you can do is make sure you're prepared and plan accordingly. I graduated into a recession (2009). My 1st job after college was aerial acrobat on cruise ships. Today I'm a VP at a global company, own 3 rental properties, invest in stocks and biz, built my own business, and have my net worth increase by $500k in the last 4 years.Read more
Let's face it... buying more stocks & index funds during stock market corrections and bear markets is scary. Which makes it really hard to do for most people like me. I have 260k i want to transfer into an s&p but it’s hard to bite the bullet and do it.
I agree, that's the more reason I prefer my day to day investment decisions being guided by an advisor seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not out-perform, been using my advisor for over 2years+ and I've netted over 2.8million.Read more
I agree, that's the more reason I prefer my day to day investment decisions being guided by an advisor seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not out-perform, been using my advisor for over 2years+ and I've netted over 2.8million.Read more
I agree, that's the more reason I prefer my day to day investment decisions being guided by an advisor seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not out-perform, been using my advisor for over 2years+ and I've netted over 2.8million.
I actually subscribed for a few trading courses but it didn't help much, been getting suggestions to use a proper financial advisor, how did you go about touching base with your coach?
If Modern Monetary Theory worked, Venezuela would be the richest country in the world. Didn't Zimbabwe try MMT under its dictator, Robert Mugabe? The result: history's greatest hyperinflation.
Nobody said printing money produced real wealth. However that equation works backwards too: real wealth is not a constraint on printing dollars, therefore stop saying stuff like "We've run out of dollars."
@@ngana8755Not sure what you mean, but you certainly dodged the point. If moneyprinting is disconnected from real wealth creation, that only proves the U.S. can pay its bills.
@@Whowhatwherewhen5 The only reason you have Dollars in your pocket is, because someone else is willing to take a loan. (The central bank for high powered money, others for other money). If nobody is willing to take a loan, you wouldn't have any money.
How can there be no inflation? If you put ten dollars under your mattress in 1980 that ten dollars will not buy you the same goods and services in 2024. The sky falls for countries that print their way out of financial troubles. The US has inflation it’s just not 1000% and crippling society.
@@E2680-l5yThe government aims to have 2% inflation and in reality they have 3%. Big whoopty doo. Can't you make an additional 3% annually?
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@@Richest_Person_in_the_World 3% after 50%+... Perhaps you don't understand how compounding works... the effective rate since 2020 is way higher. Just because it went up 50 and then only 3% more of that...
It’s not about what is happening today it is about what could be if governments are irresponsible. Thats the entire argument, she said governments should spend without concern for consequences. There are consequences and examples are countries like Argentina. This isn’t about getting an extra percent return in personal finance, that is narrow minded thinking. This is about policy and the impacts it has on society.
I don't think theres any surprise this thinking would come from the US, the country with millions of overweight people that flock to any drug that will promise weight loss with no exercise or dieting. MMT is the drug that promises pizza and icecream for all without austerity.
you're absolutely spot-on. That is the modern American thinking: don't bother checking the nutrition of your soda, otherwise you might see that chugging sodas 24/7 is why you're overweight. Don't bother dieting or exercising, as that requires real effort... instead, just believe what the "experts" tell you to believe.
I’ve read Stephanie Kelton’s book, the deficit myth, and I have watched the documentary called finding the money which is about MMT. I encourage people to read it and watch it have a Copernicus moment.
You might also want to then explore Dianetics by L. Ron Hubbard and Chariots of the Gods by Erich von Däniken. That way you're won the trifecta. You'll remain totally ignorant of how anything in the real world works of course, but this won't stop you from writing lots of utube comments about how you're now an expert in economics, psychology and archaeology.
We are being colonized by Global corporations who only think about maximizing profits. We will be taxed into poverty to pay for the infrastructure and services for these millions of new consumers. They will get UBi to buy clothes and iPhones. We pay for the healthcare and daycare of the low wage employees of Costco and McDonalds. We subsidize the profits of Global corporations. The goal is to make us all poor through inflation so that we have to sell our homes at a discount. Then we will own nothing. We will have no economic leverage against Global corporations who own Western governments. We will all be ens/aved. Mass immigration is the path to neo-feudalism. When we live from paycheck to paycheck, we have no way to resists against corporations sending our kids to fight their imperial wars.
Host, is this channel receiving any financial incentive to put out this video by anyone other than TH-cam advertising (assuming you’re not allowed to chose the advertising, save maybe for eliminating certain advertising categories like Manscapers, etc)?
@@Richest_Person_in_the_World Professor Sh*t For Brains, that's like saying because the government stole 90% the money in your bank account, it's OK, because they're only stealing a smaller amount this year. 😅
She is not insane.... Advocating for this sort of nonsense gives her status, power, influence, etc. It actually takes a great deal of intelligence and sanity to argue for something as dumb as MMT. Probably something along the lines of 'evil' or 'corrupt' would be closer to the mark.
Once again Murphy's response is to try to compare government finance to our personal or Google's finance. Neither we nor Google can create money and the government can. We have been doing it since 1790. Just because our government is making an effort to borrow. It really does not have to do it. Why should the government borrow money that only it can produce? We borrow because that is what we did to keep the outstanding money supply equal to gold reserves during the days of the gold standard. We kept doing it because investing in government securities was popular so they just kept it going in order to provide holders of dollars a safe place to keep them. Murphy is quick to mention about the recent bout with inflation without ever talking about what would have happened had we not did the spending. Murphy is not honest with his criticism. Our so-called government debt is nothing more that the amount of money that our government has invested into our economy and not taxed back since 1790. That entire amount of money did not just disappear it still sits in the pockets of the private sector. If the government never spent a dime we would have no money at all. All wealth within our economy was created by government spending (investing). Where else could it have come from?
Yeah. I would phrase a couple of things a bit differently, such as your problematic wording "government has invested into our economy" and "all wealth was created by them." It's actually that they first created Tax Liabilities, and only for that reason we are in need for them to also create the Tokens for Satisfying those liabilities a.k.a. to create enough dollars.
@@Richest_Person_in_the_World Well its good to see that you understand why we are taxed. But that has little to do with what I said. Perhaps you are correct, I could have worded my comment differently. What I should have said is that all wealth in our country originated with our government spending, investing, currency into our economy. That is not to say, that the wealth within our economy is equal to the amount of currency that our government spent. It is just a statement that our economy from the very beginning was fed by our government spending, i.e., our government injecting, investing, currency into it. Once circulating it multiplies. Our money supply is composed of all of the outstanding currency and all the liquid assets held by the private sector. Banks create wealth every time they transact a loan, but the money they lend entered the system through government spending. Wealth created through bank transactions is called credit, credit far exceeds outstanding currency in our country, but it all started with government spending. How else can currency enter our economy. If you think that I am wrong please show me how.
*Once again Murphy's response is to try to compare government finance to our personal or Google's finance.* You have already been spanked on this ideological talking point multiple times. But you refuse to learn. Once again you confuse an abstract concept 'the government' with its actual citizens. Yes a government that prints its own currency can never go 'bankrupt' on its balance sheet. This is because it can simply credit capital and debt assets. Now, if a private entity lodged returns and did that, the CFO would go to jail. So in summary, again, a government's balance sheet can always and at all times look pristine, while at the same time the citizenry are ground into devastating impoverishment. You can recycle this talking point over and over again, but the only people you are going to sell it to, are other morons, sorry.
@@willnitschke Please expound on how our so-called debt impoverishes the citizenry? The abstract concept is not abstract at all. A Fiat system are different from commodity backed system, We are under a Fiat System, a fact that you refuse to accept. All MMT does is tells us that we are not using that system to its fullest advantage. In stead of the CBO worrying about whether a bill adds to our so-called deficit, it would be more effective if its job was figure out if it is inflationary. If there are idle resources available for using, we should use them without causing inflation or crowding out. Tell me where that is incorrect? th-cam.com/video/N8HOWh8HPTo/w-d-xo.html
@@BanBb1 I'm sorry, but you sound literally like a delusional moron. So Wiemar Republic, Zimbabwe, Yugoslavia... massive money printing. What happened to the citizens? MMT doesn't tell us anything. It's just brain dead theology pretending to be economics. Governments, particularly in advanced economies, are always horrifically bad at capital allocation. A government bureaucrat is not going to magically decide what he feels are "idle resources" and "fix" the "problem." That's not the role of the government, and it's only an assertion made by an economically illiterate imbecile. Capital allocation is the role of venture capital, among other entities in the private sector. Some of these people are incredibly smart, but still loose money most of the time. The incompetent clowns with government jobs have no hope.
In 1967 my father bought our first family home for $15,500. He earned $7,500 per year as an autobody repairman. Last year, the house across the street from our old home sold for $989,000. My father would have to earn $450,000 a year to buy the same house in 2024.
I'm not sure that's how it works, that 1/2 of your annual salary has to equal your home. Rather you take a look at which mortgages you and your spouse can afford.
Printing money is used supposedly to make jobs, BUT, we know from global experience that when the economy slows down, that hiring people to dig holes and then paying them to fill them in and then dig again and fill again is what China has been doing since 2015 by building over 200 entire cities that are empty. Now, that has caused a massive bubble that is now bursting and is destroying the economy. That’s what the craziness of MMT does.
The principle of MMT is that you need to manage inflation using taxes and monetary policy. I don’t know anyone who says otherwise. By the way, inflation was not just a US problem, in fact the U.S. managed inflation much better than most other developed countries. I think the bigger problem is the almost Trillion dollars spent on Defence, failing its 7th audit and we are still increasing the Defence budget.
*I don’t know anyone who says otherwise.* Then presumably your bubble consists of idiots. Inflation is created via fiscal policy. Monetary policy is like a sledge hammer that then tries to put a break on what fiscal policy is screwing up. *By the way, inflation was not just a US problem...* True, it was a problem wherever governments copied what the US did. Incredible, huh? *I think the bigger problem is the almost Trillion dollars spent on Defence* Whatever you think of defense, debt servicing (interest payments on the debt) now exceed defense spending. So maybe the _actual_ bigger problem is how we got into this mess, and why we continue to dig ourselves into a deeper hole. Maybe that's what needs to be fixed, first.
@@mandypants226 If you want to debate me, first begin by NOT assigning stupid assertions that I never made, to me, in the desperate hope that I will let that fly. That's the hallmark of a half wit, sorry.
By her logic, there's zero need for taxes. After all, taxes are the result of the government needing money but if the government can just print any amount of money it needs, then there's no need to tax it's people. This woman throws out the entire understanding that scarcity creates value. The more printing, digital or otherwise, of money, reduces it value. I've had discussions with a number of people that refuse to understand this fact. It's the entire reason the government turned to taxation in the first place. It's why people hold value in digital currency like Bitcoin. She talks about how government needs to work on limiting inflation instead of debt, but immediately advocates for a massive factor in creating inflation.
Strictly speaking you could replace income and consumption taxes with currency debasement. This approach is not illogical. It's in fact what governments are constantly doing anyway. However, if you are going to switch to currency debasement alone, you've just swapped out one set of taxes for another.
Don't look at foreclosure as losing a home, think of it as a bank gaining an asset.
Bank is not gaining an asset, but whoever buys at auction shold be.
@@aaronfreeman5264
Unless the buyer buys the house outright the buyer has a mortgage.
A mortgage is a liability for the buyer not an asset.
However the mortgage ( in the form of mortgage payments ) does become an asset to the bank that has lent the money.
but,
Even if the buyer buys outright the house only becomes an asset after the bank that foreclosed on the original mortgage has sold its “asset” to the buyer.
Wrong, the bank's asset is having a federal reserve account.
Brilliant!
Let’s hope all Americans are foreclosed on and we can finally save the economy
🤣🤣🤣👊🎯🎯🎯
I only had $0.0000008 in an account, but I had a talk with the branch manager, turned the statement upside down, and she agreed and fixed the computer, I'm a multimillionaire now. It's all about communication skills.
I cannot believe she actually said that, again I ask: where are these “economic” experts coming from?
Why do we even bother to keep a record of who owes what to whom?
@@thedave7760 Assuming you mean who owns how many dollars to whom, the first question has to be how did these dollars come in to existence in the first place? How can a dollar come into existence without somebody owing somebody something? That has to be fully understood before this topic can be rationally discussed.
I had 58008 in an account and turned it upside down.
The Jedi mind trick strikes again.
A corporation, unless it is a commercial bank, does not create money. Is this guy really an economist?
A corporation creates the value that money is a unit of, are you really this stupid? Our current monetary system literally turned US dollars into US stock shares minus the owner rights.
A company can issue bonds for sale, just as the government issues dollar bills for sale. Dollars are iou's to the federal government, same thing.
Money is a liability to the issuer, in the same way corporate bonds are. Do you understand economics?
She advised Bernie Sanders, is there really anything else that needs to be said?
Remember how they loved Venezuela as an example of socialism working...
Any system can work if you have vast amounts of oil wealth. Saudi Arabia is a dictatorship or a kingdom depending on your perspective and they have a pretty good quality of life.
@@danparish1344 Depending on your class. Outsiders don't find it so good.
@@danparish1344 they have low crime because the harsh punishment is a deterent.
Come on, man! Socialism just hasn't been done right.
Ripping people off isn't bad. You need to look at it from the perspective of the scam artist
If the person being ripped off originally intended to rip you off, then I say it's fair
@@Richest_Person_in_the_World Except nobody wants to be ripped off, so not fair. Still.
@@willnitschke If there was Person A who started out as a scammer, then it is fair to scam him. In this case, people who supported Taxation prior to learning its MMT role.
@@Richest_Person_in_the_World People forced to pay taxes are not scammers. Still.
@@willnitschkePeople who advocate Taxation are scammers. Their intent was to rob thy neighbor
I’m 70 years old and retired. I’ve become more cynical and listening to things like MMT over the past years. The main reason the government doesn’t have to worry about where the money comes from. Is they can always take it. They have law enforcement and jails to put you in if you don’t give the government the money.
Exactly. MMT is just a command economy with extra steps.
@@Hydengoseakutter bilge, it explains the system out dullard
Well der... Well done!
She's totally disconnected actual goods and services from the amount of money and increase in productive capacity. A recipe for inflation.
it used to be working coz china and japan were buying up all the excess bond. create a cheap cost of borrowing and avoiding high inflation. but now no foreign country buying up the excess bond, hence it will cost inflation.
This is 100% correct! Even worse these people believe in Keynesian economics but they only follow the part about deficit spending during a recession. They will never stop spending so we will never have a baseline on the economy to know if we should be running deficits or surpluses.
@@objectivethinker3225A government suprlus means your bank account is getting drained. Not ideal
@@Richest_Person_in_the_World No, a fiscal surplus can be used to pay down the national debt. But you are correct if we didn't have 35 trillion in debt.
@@Richest_Person_in_the_World What you say is undoubtedly true and bad for you, but this is supposed to be from the government's POV. Whoa - that rhymed!
I knew that lady was nuts when she used that "6 or 9" analogy. Someone drew that 6 or 9, so someone knows which one it is, therefore there is an objective right and wrong answer.
Subjective morality is poison to ethics. Didn't know subjective economy was a thing.
Its value that’s subjective. “The economy” is a figure of speech.
@@theGefilteFist
"Subjective: characteristic of or belonging to reality as perceived rather than as independent of mind".
Price is subjective. Value is not. The circumstances in which an item is presented determine if it has value or not.
Gold has objectively no value, outside of computer chipping and electronics. Its price is based entirely on subjective assumption rather than objective utility like steel or gasoline.
@@1krani price is literally printed on the price tag (where applicable). Everyone has to decide for themselves if the value they get out of something is worth the price cuz the value only exists in their heads
Subjective morality is the only morality, that actually exists. Subjective economics ofc does doesn't exist.
@@vulgoalias4050
For morality to be subjective, one would have to believe that certain ideas or actions are not inherently hypocritical or self-destructive. Rape springs to mind.
Post-modernist economics :(
Post-common sense economics!
Post intelligence economics.
The real question is why they follow Keynes... he's the one that lost the power for England iirc.
MMT is literally just how the economy works.
It's not making anything up.
@@coolbanana165 Then it's a description, not a theory. Theories should allow for prediction, and description just says how things are, and not how they will be or should be. Not that description aren't useful, but they're useful in a different way than theories.
She talks about not being in full employment and that we have the capacity to rebuild the infrastructure. But, so what if we have unemployed people. Do they know how to use a hammer, or build a train track, or lay concrete?
Frankly speaking, in all likelihood yes, they can. Employment in Construction seems to vary most much more than average with recessions. Many recessions are primarily a result of a building collapse, 2007, Savings and Loans Crisis, the Great Depression, etc.
But more to the point, you are correct that not every unemployment individual will end up working in construction. But I do support the concept of a Guaranteed Employment scheme. I would suggest keeping the federal government, which responds slowly and bluntly, largely out of the operation. Instead I would have a federally funded program wherein Municipal governments and Charities can pay people minimum wage for 8 hours a day 5 days a week. I would also open it up to Manufacturing companies to cover up to 6 months of training, although half the cost would have to be repaid if the trainee wasn't employed there a year later. Smaller and generally financially strained entities will react much more quickly and efficiently to the available labour pool. They aren't stealing jobs from the private sector because of the limits on hours available and wage. But it would keep employment up in a recession while getting things done.
or want to? full employment is only possible when you remove welfare (besides disability)
i work in construction management in DC area which have a hiring law called First Source. we have to hire DC residents to fill our jobsites in DC that receive public money. the problem is many people would rather not work and live on public assistance, than sweat on jobsites and earn 20% more. welfare creates generational poverty and rob them of motivation to reach their potential. it is insidious and a tragedy
We have more important issues to solve than covering the earth in beton.
Listening to her speak is like listening to a teenager talk about credit cards. "Yeah, you just use the piece of plastic and it pays for whatever you want! its free money!"
Not really the same because you owe to your bank, while the government does not owe to that bank
@@Richest_Person_in_the_World What do you think happens when we run a deficit? We raise the national debt. If we default on that debt, it can be catastrophic to the entire country.
@@novacorponlinewe don't default on the debt, we print more money, which can or cannot cause inflation depending on where the money goes and what is available and needed in the economy
The Richest Person In The World is right; don't insult teenagers, by comparing them to Kelton. At least a teenager will bear the cost of their debts themselves, or maybe with their parents' help. The government makes 7 billion innocent 3rd parties pay for their handouts to weapons manufacturers and government contractors and bankers.
@@novacorponline If the government loads my account with $1,000,000 yes that is public debt now, but it's my asset as a citizen. Therefore you should rejoice at the realization that the deficit clock is your savings clock
97% of our currency is created by commercial banks. When a bank issues a loan, it creates new money digitally and charges interest on it.
For a 30-year mortgage, you’d work about 15 years to pay off the interest alone, all for money created with a few keystrokes. Let that reality sink in, and you’ll begin to understand the flaws in our financial system.
First, don't tell the MMT crowd that private commercial banks create most of the currency, as they all think 100% of it is created by their all powerful government. 😉
Secondly, what is the alternative to loaning money? Nobody is going to give you their savings for free. People aren't stupid. Are we supposed to rent for 60 years and buy our home for cash at age 70?
Most people do not understand this. And the people who benefit from this hate MMT.
@@charlesloucks1840 The people who 'benefit' from MMT are the wealthy. The people who are screwed by it the most, what I call the "useful idiots of MMT" are the bottom tiers.
Devaluing the dollar is insane unless you hate citizens.
The world... it's insane that they'd subject everyone to it.
It’s good for asset holders, but bad for laborers. Reference: 2020 to today.
If you want the goverment to Hand you a sound currency, you are asking for a government handout
And love corruption.
It’s actually not necessarily bad for laborers. A devalued dollar means labor can be more competitive at home in the USA. We’ll see a lot of factories spring up at home rather than manufacture everything overseas.
An important point for anyone to understand is that money itself is not wealth; it's merely a tool, a medium of exchange for goods and services. A good currency, like gold or silver, will also have other properties and can be a store of wealth, but ultimately, it's the exchange function that's the most important.
Wealth is actual goods, services, and resources utilized for goods and services. It should be obvious that merely printing more money not only doesn't create new wealth in the form of goods and services, it dilutes the rest of the currency in circulation, devaluing the currency and causing price inflation.
Borrowing money is trickier, especially when the government's doing it. Still, like any borrower, the government either has to pay it back or default on the loan. They often get a pass because it's the government borrowing the money, but they shouldn't. The money government borrows has to come from somewhere, and the question is where would the money have gone if government hadn't borrowed it?
Either way, printing or borrowing, the government isn't "stimulating" the economy into creating more goods and services, it is merely redirecting the economy into whatever industries or sectors they think need 'stimulating'. The government can never run out of money, but the more that they borrow or print, the more bad consequences they create. That's why it's not "free" money!
Stephanie Kelton is wrong to say that it would be inflationary for government to spend only during "full employment". How many concrete workers and architects does she think are unemployed? And government spending rarely targets specific groups of people in such a way. She's just expecting, or perhaps *hoping* that those unemployed people will become employed due to government spending. This is reckless thinking when you can't explain how it will happen.
MMT'ers will respond by noting the difference between the money supply and the money supply as measured against economic output. But, 1-2% inflation is still inflation, and the Federal Reserve understood this when their inflation target used to be 0%. Heck, Hanke says the target should still be 0%; it's a fair issue to debate. But even if there are some MMT'ers who want 0% inflation, they are still ignoring the counter-factual inflation which comes in the form of central banks preventing slight deflation----technological/growth deflation, which is OBVIOUSLY good deflation.
@@MBarberfan4life Right. Deflation is only a problem for people (and governments) in debt!
@@macsnafu and that is only credit deflation, particularly when wages fall more. But there's nothing bad in itself with falling prices, because a growing economy brings prices down, particularly in terms of our wages. That's capitalism
The problem with MMT is that they believe the relationship between inflation and employment is a step function. Everything else is main stream econ. Your post assumes people are rational, but they change their work and investment patterns based on feelings. The government can change people’s behavior (feelings) so they work more and make more stuff.
Mac
Look up goldsilver money or Mike Maloney. He does have some good videos on money. There’s a reason and historical reason he always says gold or silver is money but the U.S. dollar today is fiat.
Currency doesn’t preserve purchasing power. Money has like five key tenets that a good money must have and preserving purchase power is one of those.
You’re right. If gold is found in mass quantities it’s inflationary. Now gold is a good or product in itself as it’s more rare. So even if it wasn’t money it’s worth something unless if you’re a Native American or some tribe using other things for barter. Some tribes used gold for barter but some used sea shells etc. and Polynesians on one island rowed 200 miles to another island to bring back a rock and that rock was considered money.
So ya people should distinguish between money and currency.
Creating more money is necessary when your real economy is growing. More cash is needed to complete the increased growth in transactions. But supporters of MMT mistakenly believe this relationship also works the other way around. That if you increase the amount of cash circulating, this automatically increases economic activity. In real life this doesn't work. What happens is that sellers of non-discretionary goods elevate their prices rather than creating more goods and services. There is no growth in real economic activity, just inflated prices.
With respect, i agree completely with the second statement you made, but i disagree with the first. Why must monetary expansion match real growth? Surely, deflation is THE point of an economy? Who cares if my salary is decreasing in the actual figure, if my purchasing power remains the same, because goods are becoming cheaper?
What you're describing in those sellers of non-discretionary goods are monopolies. Break up the monopolies and prices will start to come down as suppliers compete for business.
@@garethbarry3825 I agree with you, but I accept Milton’s approach of “at least don’t inflate the currency” instead of trying to argue Schiff’s position of allow it to deflate.
@@charlesloucks1840 Great idea, except private sector monopolies don't exist, only government ones. I can't shop around to get a driving license renewal for a better price.
@@jsbrads1 It's not clear to me that Schiff's position is wrong and you presented no arguments as to why he is wrong. Pragmatically, deflation is undesirable primarily because it would cause the government to collapse.
Following Kelton's logic, if deficits don't matter, why bother taxing at all?
Exactly. Just print money
@@goranserka3601 Because taxation gives value to the currency
Keltons what? That woman is delulu
1. To create demand for that currency
2. Tax can be used to control inflation
3. Tax can be used to create more equality
4. To exercise nation-state power, monopoly of violence and taxation (death & taxes)
PS. I'm not MMT supporter!
@@pnc1358 Tax cannot be used to control inflation. This MMT brain fart is among the dumbest offered by the ideology. If poor people are struggling to pay rent or buy food, you can't just raise taxes on them so they become homeless and starve to death. Technically, that will 'fix' the inflation problem, sure. By creating a lot of dead people. Or you could raise taxes on Corporations instead, which will be passed through to consumers (as all operating costs must be), and this will cause even worse inflation.
MMT is so full of holes it's hard to believe it's still taken seriously, especially considering the inflation we've seen across the world since that TED talk was given.
Because it's about turning economics into theology. Hence it doesn't need to agree with empirical observations.
MMT simply explains how money is created and used in the economy. th-cam.com/video/1_vNAY2Nrm0/w-d-xo.html
So you could have Poked 1 Hole with your comment, why didn't you?
Techincally its not inflation. It's a price shock, triggered by the ukrainian war and the loss of russian gas from the world economy. Inflation happens when the price of everything, including wages goes up in a spiral like in the 70s.
@@alexrenn2479 No it doesn't. MMT doesn't "explain" anything. It's just stupid nonsense. 😂
Dont think of an IRS audit as something to dread, think of it as they're your friends coming by for a beer
Your beer and your chips and salsa!
Reminds me of that scene from Wolf of Wallstreet.
That lady is insane. FREE MONEY YOOOOOOOO
Second that.
Insane or evil?
Insanely evil.
And we are supposed to believe your theory that money printing is only done by inserting gold coins into the printing press
@@charliesmash winning!
This is the first time I've heard MMT described by a proponent as a matter of perspective treating deficit spending like double entry bookkeeping. And it's still stupid...
Well, the science of it is 100% accurate. The implications of using it is a different question. That's why you should never listen to economist who don't understand money and banking, including this clown economist.
@@curtbalch2321 It could be worse. Imagine you're Murphy and not learning after 10 years
@@Richest_Person_in_the_World Oh look, anonymous nitwit babbling shit on the intertubes pretends to be smarter than a guy who has written whole books on topics he doesn't remotely understand. 😂
@@Richest_Person_in_the_World Imagine an anonymous half wit on the intertubes who doesn't understand what debits and credits are, or who thinks Yugoslavia currently enjoys single digit inflation, who then goes on to cluelessly attack a PhD who has written whole books on topics he doesn't begin to grasp...
I've seen so many people say the government CAN'T spend too much money. That's an impossibility unless making money worthless is the goal.
This feels like your projecting your bias onto what people say. It is literally true that the US government, as the sovereign issuer of money, is able to create and spend money on whatever it wishes. But that’s not the whole story. Every MMT’er, Kelton included, caveats that with the limit being the inflationary pressure of that spending. Don’t let bias hold you back from steal manning the arguments of others.
@@timgwallisSo how do we just create all the money we need for free healthcare, college, etc etc and deal with the inflation? That’s the missing piece of the puzzle. Monetary systems can only handle so much inflationary growth at a time.
@@januarysson5633 totally agree with the last part of your statement. However I disagree that the “how to handle” part is missing. MMT’ers make it clear that the means to deal with inflation is taxation. Creating new money increases the money supply in circulation, taxation reduces the money supply in circulation. Personally I favor a progress consumption tax. The more you spend, the higher the tax rate you pay. With a digital dollar the rates could be programmatically set to ensure the money supply in circulation new grows faster than 2% annually.
That's why we have tax, to make money more valuable.
January
In the past miners of silver and gold brought metals to mints and the mints made coin money that would be given to the miner. ZERO NEW DEBT is made when mints would convert metal into coins. Today fiat currency has made the system so when a new mortgage is made new dollars are also made. That is a totally different system.
We simply have liars running things.
The name of that liar is Putin
@Richest_Person_in_the_World What flavor was the Kool Aid ?
@@Whowhatwherewhen5Am I supposed to praise the Kremlin in order for you to label me a free thinker
@@Richest_Person_in_the_World As far as I can see, your role in these exchanges is to be the virtual equivalent of the Village Idiot.
Not just liars, they're also stupid and greedy
Modern monetary theory is just printing money Weimar style. Change my mind.
Did you know women could vote in the Weimar Republic? Just saying.
Weimar created problems create Weimar solutions
German inflation was tamed since then, so it's not a bogeyman
It's more like Zimbabwe money printing.
And transgenderism was rapidly on the rise, along with most other "diverse" viewpoints
This MMT thing is great. No limits on anything. SS is fine. The interest we are paying means nothing. Nothing means anything. Why do we have taxes?
According to MMT, it's for the same reason some children enjoy pulling the wings off flies.
@@willnitschke Sounds right.
Why does MMT arguments seem to be like accounting tricks? Why does it seem to be some sort of misdirection and sleight of hand?
All of the interest paid on the National Debt does go to someone as Stephanie Kelton stated. This issue is it is govt. money paid that does not come back into the system in fair taxes or production. For the system to work that has to be the case.
That's just one major hole in her "logic". A lot of that debt is paid to foreigners, such as the Chinese.
The bigger hole in her "logic" is she assumes all government debt balances to assets on the other side of the ledger. It doesn't. Entitlements are expenses, not assets.
@ Entitlements like Social Security don’t add to the National Debt. SS is still in the black so no debt. Incurred. Also, SS recipients spend it back into the system which ends up working for all. Basically put, the money stays at work and causes no debt. Interest paid to China on the other hand is production lost.
@orangeofmars2835 entitlements don't add to the national debt. 😅🤣😂
Consumption = production 😅🤣😍
We should all be on welfare bro. The more we consume the richer we are! 'Cause "the money's at work". The more I max out my credit card the wealthier i become. 🤣
If deficits are a good thing, why have any taxes?
To instill value into the currency
You think you're calling their bluff, but MMTers, Thomas Pikkety and others have said that taxes should be understood as a social engineering tool rather than a finance tool. The point of taxes is to punish you for behaviors the regime doesn't like, and to control the flow of resources so that wealth is distributed according to what the regime thinks people deserve instead of according to what they earn through voluntary exchange.
She's dishonest. She was telling us that inflation is the worry, and when it got here in 2021/2022 she told us that inflation was transitory. That's an ad hoc excuse because she knows inflation means there should be no more handouts. Having the reserve currency isn't a difference in kind, it's just a difference in the amount of time the U.S. Government has. Guess what happens when you print too much? Well, then you don't have the reserve currency anymore! No duh
Yup. Total inflation shill
Yes, an industrious counterfeiter will never run out of money. But a big enough counterfeiting operation can lower the value of everyone else's money to finance itself. Even if it's spending its funny money on roads and bridges, it is impoverishing citizens by reducing the value of their holdings in money. Am I missing something? If printing money is harmless, why shouldn't everyone do it?
She is saying benefits (more roads, …) outweigh the costs (inflation), not that it is harmless.
Make more money then
The trick is that "the private sector" includes the entire economy minus the government. So of course all government spending goes to the private sector, because that's the only other party to trade in this simplified model. Nevermind the massive wealth transfer from the average person to weapons manufacturers, bankers, government contractors, bureaucrats, politicians' private stock portfolios, welfare recipients, etc. That's all technically part of "the private sector."
@@theBear89451 Yeah except that we spend so much on fomenting and/or prolonging wars that the benefits don't outweigh the costs.
It’s silly to say, “we can’t afford it”. If it needs to be done, and it has a higher priority than something else, money can be printed to finance it.
Wouldn't it occur to the MMT proponents that, if they "only" have to monitor inflation, at the very least, the debt and deficit are metrics you'd use as early indicators of when you're about to enter inflationary levels of spending? IOW, even if you try look at it from their perverse perspective, the debt and deficit should still be very meaningful (and very distressing at current levels).
Stephanie Kelton said "Just as a 6 becomes a 9 when looked at from a different angle..." THAT is the crux of the problem of MMT. A 6 NEVER becomes a 9, no matter which angle you look at it from.
She's just trying an even simpler version of: "Someone's deficit is someone's surplus"
Even Jimmy Hendrix wrote a song about it!
@@Richest_Person_in_the_World Except that's even dumber than the 6 is 9 claim. 😂
She should’ve explained why the government cares so much about collecting my taxes if they can just print all the money needed for high speed rail, free housing, and foreign wars.
To give value to USD
@@Richest_Person_in_the_World Bit didn’t those dollars I sent the IRS have value back when they were in my wallet? How does me giving them to the government give them value?
@@theybrokemywatchThe fact that They (dollars) are the thing which saves you from tax punishments. As in "Give us $100 or we'll jail you," you react: "Whew thank god I do have $100 here."
@@Richest_Person_in_the_World 😥
@@theybrokemywatchLike in Monopoly you have a Get Out Of Jail Free card, and you might wanna hold onto it. The dollar is such a card IRL
I had a discussion with some friends who seemed to want to champion MMT. What they failed to recognize is that inflation is the real killer of MMT, and you can't print your way out of it. The latest round of money printing by the government, where they increased the money supply to the tune of 30%, led to approximately 20% cumulative inflation from the time they started printing the money. Not good at all.
Ask your friends, if you can take MMT to infinity, then why do we need to pay taxes? The government can simply print all the money it needs?
Circular argument. The taxation addresses the inflation.
Hello. Have your friends learn Quantitative Monetary Theory. MV=PY. What MMT is stating is that instead of issuing Treasuries to be purchased by various investors, the Fed can just buy all of them instead of the fraction they do now. This would create an increase in the money supply multiple times over. Once they recognize that and understand the Quantitative Monetary Theory, they will get it. That is unless they like hyperinflation. Assuming friends aren't morons though. Lol
@@imrangul6750 MMT argues that the value of a Fiat currency is derived from the acceptance of the currency in payment of taxes. Consider how long you think the USD would last if the IRS switched to only accepting Pesos. Taxes drive demand for a Fiat currency. They are essential to it's function.
The stance MMT takes is that because of this, it's okay to spend more USD in a given year than it collects in taxes, as people will save some for future tax payments or to buy things from someone who will have to pay taxes. And as the economy grows in size, ideally due to rapid growth but probably due to inflation, the amount expected to be collected in the future grows, and so more overspending can occur as more money will be saved.
@@scottcincinnatikid9804 No, what MMT is arguing is that when you increase M, you get a rise in P and/or Q. And that you should focus spending on sectors that raise Q. This is widely accepted in QMT, banks increase M1 and M2 by issuing loans, and the productivity of those loans increases Q enough to compensate.
But I agree they can't just liquidate all outstanding debt. I would say selling government debt will always be an important anti inflationary tool, in the same way the Fed pays interest on reserve balances. I would like to see public banking with the Fed, so that people can get the same interest rate on savings as commerical banks do. Or likely, lower rates to take more money out of the economy.
3:28 - WHO does the Federal government owe $28 trillion dollars to again? Which bank is going to foreclose on them?
Bond holders, primarily. Foreign sovereigns, pension funds, individual investors, etc.
If they don't honour their debts, the US economy would be destroyed over night. Hence why over 1 trillion is now being funneled into debt servicing, away from schools, hospitals, infrastructure, etc.
Yeah, so the debt load is pretty devastating right now. (To consider how bad it is, the US Federal government only collects 4.5 trillion in taxes. In other words, about 25% of all tax dollars are sent elsewhere, instead of being used productively. And it's rapidly getting even worse.)
Thanks for asking.
@@willnitschkeYou are so clueless lol Supposing 28T is owed to bondholders and another 28 is needed for hospitals. What's to stop Jerome Powell from just printing 56 trillion. So there is no Crowding Out as you claimed
The number (32 trillion actually) is already in the accounts. It's just a scoreboard for how many dollars exist worldwide
@@Richest_Person_in_the_World *You are so clueless lol*
No I'm not, you're the idiot in this exchange.
*Supposing 28T is owed to bondholders and another 28 is needed for hospitals. What's to stop Jerome Powell from just printing 56 trillion.*
Hyper inflation would result, assuming the 56 trillion was pumped into the economy, Professor Sh*t For Brains.
China already pushed back on accepting new US debt, German bonds pay interest lower than the rate of inflation. Interest rates rose on our debt and if we don’t get our spending under control, our government can collapse. Inflation can run out of control and the flow of the economy can break. Retirees won’t be able to pay for medicine, housing, food…
Reality can foreclose the US.
Simple thing to remember, if you hear the terms "deficit", "print money", "borrow", "quantitative eas" these are the same things at government level, and it all leads to the same thing: inflation.
No, that is the standard non-MMT boilerplate which is wrong
@@Richest_Person_in_the_World you didn't pay attention to the last 4 years did you?
@@letsgobrandon416 He is not very bright and an inflation denier, so just ignore him.
@@letsgobrandon416What is the current inflation rate in the U.S. and what is the Fed's desired target
@@Richest_Person_in_the_World The price level is 30% higher than 3 years ago. Thanks for asking. If inflation is 50% for 1 year, then everyone is twice as poor. Even if the rate of change _then_ drops to zero, people are still twice as poor, knucklehead.
If a government can ‘never run out of money’ then does that mean the government has an infinite amount of money to spend on what it wants?
Of dollars yes. But it would be unwise to offer higher and higher prices every year
A government could in theory buy everything. Society may collapse around it, but the government, if backed by a sufficiently capable military, would not. What's not to like?
@@delusion2987 if inflation begins to exponentially rise then would you curb that with fiscal policy?
@@kayedal-haddad Given that the government caused the inflation, it can also stop it at any time. As we saw recently, in Argentina.
yeah but the citizens will suffer, Weimar
So if she's right, and the government can do all this "paying for something by printing $", then why do we need to pay taxes????🤔🤔🤔
That way the dollar becomes valuable as a get out of jail free card
@@Richest_Person_in_the_World Still confused, I see.
Under a fiat currency the point of the dollar (or euro etc) is to pay taxes. If the federal government said "We will no longer accept USD for paying taxes, from now on only Mexican Pasos will be accepted" people would stop usong the dollar very quickly, and move to the new currency that they cam use to pay thoer taxes and avoid punishment for failing to do so.
MMT is saying its okay to spend more of these than you are accepting in a given year, because you are collecting enough to maintain a demand in the market for them.
@@neolithictransitrevolution427 No it isn't. That's just a retarded line of Molser scripture. 😅
The point of any currency (whether it's fiat or not is irrelevant) is to efficiently facilitate exchange.
BTW, I can hold my entire net worth in Swiss Francs, and if I was a US citizen, and had some tax to pay, I'd just transfer my Swiss Francs using telegraphic transfer to pay the bill.
This is all sooooooooo stupid. 😂
@@neolithictransitrevolution427 This is all so stupid. I can keep all my currency units in Swiss Franc's and if I'm obligated to pay US taxes, do a telegraphic transfer, in Franc's, to pay that.
Everything MMT "says" is nonsensical, hence irrelevant. Demand for a currency is derived from the fact that dollar denominated debts are loaned and leveraged. There is always more leveraged debt than dollars. This is "OK" until there is an unwind and then a liquidity and/or collateral crisis follows. Printing more dollars does not fix anything, it makes everything worse.
Wow, so much strawmaning here, both in the interview as well as in the comments.
Wow so much arse pain from you. 😂
It's shocking. MMT is not that complicated, though it does uproot a lot of concepts we grew up with. Everyone first encountered paper currency at age 3
@@willnitschke good luck learning about anything worth learning from a TED talk video, much less from a commentary video. As a description of the current macroeconomic system we live in, MMT is spot on. Anyone who says otherwise is referring to a system that is a century old, like the guy in beard is, or just referring to a fantasy island economy.
This is the worst argument against MMT!
No it isn't.
The general public now accepts all other forms of taxation as legitimate means of operating government. I’m sure the general public will accept direct inflationary money printing as a legitimate government operation in the near future as well.
I wonder where the data came from to correlate deficit to the surplus. How do we know there wouldn't still be a surplus without the deficit? Considering the government is very inefficient, her graph pretends its a 1:1 correlation. Did she factor in the surplus there would of been if there wasn't inflation from deficits from increasing the money supply?
How does that lady even have a job spewing so much nonsense.
printing money goes back to Rome if not further... they knew back than too.
They knew then, but it's been forgotten.
@@Richest_Person_in_the_World The Roman Empire collapsed, Professor Sh*t For Brains.
The main problem that is not addressed is the fact that managing inflation of a massive system is like trying to dock the Seawise Giant while she’s at full speed! That level of accuracy and control is not easy to attain in a moving economy!!! 😅
Which is why there should be no attempt to 'manage' it, because it can't be done anyway. The free market should price the cost of money. The only reason why the free market is hindered from doing that most of the time, is because half wits control the printing press and introduce distortions all the time.
@@willnitschke But the problem with the free market is it creates excess inequality; which leads to revolutions. How do you suppose the free market can create a stable society under modern expectations of the Democratic population?
@@RadicalModeration The free market doesn't do that, your government does. 😅
Here is an example, the Fed engages in QE. This is a massive asset purchasing program, which causes the price of assets to rise. Who owns most of the assets? Rich people, of course. So the rich get richer. But all in the name of helping the middle class, of course. 😉
*How do you suppose the free market can create a stable society under modern expectations of the Democratic population?*
By having more of it, and less government 'help'.
BTW, I don't see what you follow-on comment (assertion) has to do with your original point about how the government has a hard time managing inflation. It's of course understandable that it would, as it's the primary producer of inflation to begin with.
@@willnitschke I'm saying that your free market solution is not a real solution as it solves one problem while creating another.
Worst argument against mmt I’ve ever heard.
The worst comment for mmt I've ever heard. Love the trust me bro but no sound explanation to mmt .
So what you're saying is debunkings of MMT idealogy hurt your feelings?
Is there a limiting principle? Ask yourself: Would it then be fine to run $100 trillion deficit every year? How about a quadrillion? If it really is a perpetual motion machine, it’s all benefit at no cost.
If they are so okay with deficits with no limit, why owe any taxes that offset the deficits?
Not a perpertual motion machine, but more moneyprinting is needed
@@AB-qt4djBecause if taxes stopped being collected, the dollar would go to zero. "That is not true!" you exclaim, while pretending to hate the dollar.
@@Richest_Person_in_the_World Except it wouldn't. That's just brainless MMT theology.
@@VeniVidiVid no one is arguing there are no limits. Banks borrow and use that to leverage investments, and increase the money supply while doing so by making loans. But because they make productive investments, this is not inflationary.
The point is only that the government can create money to make an investment or fund a program, and the economic growth will expand the tax base enough to collect the created money. That doesn't mean there is an infinite number of productive spending activities. It doesn't mean that the returns will fully cover the program. It just means that if economic activity and the tax base expand because of the spending, the increased demand for dollars can balance out the money creation. Again, as banks do when making loans.
The dialogue around MMT is mainly to push the idea that we should focus more on the productivity of our spending programs rather than looking at the deficit or surplus in a tax and spending plan.
She forgot to mention that we can always invade other countries if it doesnt work
You Russians?
@@Richest_Person_in_the_World You dumb?
@@Richest_Person_in_the_World You stupid? (Rhetorical question.)
😂😂😂😂
keynesian economics is trash...approaching almost 100 years of this bs.
And yet there has been no Muh Hyperinflation as you crowd predicted
Yes, and it's destroying western civilization
"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless" -Thomas Jefferson
Fortunately, all inflation comes from the government, which will never allow deflation, so we dodged a bullet there.
Where does he think the $100 dollars came from for the robber to steal? Somebody had to print it didn't they? If the Gov didn't print money, he wouldn't have his $100 in the first place.
Except when the red ink gets put, not into black ink, but cronies, war and losing enterprise (eg Solyndra,etc).
She’s making a grandiose assumption that “government” makes perfect, unbiased decisions. History and current experience suggest otherwise. Especially the more removed spending is from accountability.
In the discussion of full employment, do economists ever take into account the mismatch between the job vacancies employers want filled and the pool of workers who are qualified to perform those jobs? The Army only needs a few tens of thousands of recruits annually. However, 71% of youth do not qualify for military service because of obesity, drugs, physical and mental health problems, misconduct, and aptitude. Given the casual effort of our public education systems, there are probably no categories of employment where corresponding labor resources are readily available.
Right. You don't go from fast-food worker to architect overnight!
@@macsnafu I mean in cuba they train doctors by the tens or hundreds of thousands but sure you can't do if if you want to keep doctors in short supply and medical cost so expensive that it is the leading cause of personal bankruptcy . Not a person in this comment section understand money or economics and that's how you get to the point where you claim not teaching and educating people who can't afford it will lead to a shortage of relevant skills and pretend that's not just a funny commentry on capitalist extraction.
I have viewed many of Murphy's criticisms of MMT. They are all presented in a manner that one would believe that we are still under the Gold Standard. He offers no good explanations because he reverts right to that era, where Fiat currency did not exist and we still had commodity backed money which is no longer true. He can't seem to accept the fact that our currency has value because our government mandates it and that is good enough for almost all of us. Under our fiat system we have to accept this because nothing else has been proven to be better certainly not commodity backed money. If we were the only country with fiat money and the rest of the world still backed their currency with a commodity like gold, Murphy's argument might have more value. But the fact is that the rest of the world is on the same fiat system we use here. Listen to him and count the number of times he compares government finance to our personal finance or the finances of corporations. None of those arguments are legitimate under our current fiat system.
And he uses patently wrong examples. "Oh it's the same with my debit card when I buy spinach. If my account is empty, according to Mosler I can just take it." Facepalms galore
Your attempts at criticism are laughably ignorant, sorry. Murphy has written books on money mechanics. People like you wouldn't even get past chapter 1. 😂
@@Richest_Person_in_the_World The examples are not "wrong" because a confused child is too thick to understand them.
@@willnitschkeAnd his great mind has led him to... wait for it... Bitcoin 😅 Fool's gold as peter schiff says
@@Richest_Person_in_the_World More trolling and stupid comments from you, because let's face it, what else can a confused child do but sulk?
Google will actually have to pay back its “debts”. For the federal government’s “debt”, all they owe us is not to take our heads if we pay our taxes. Come on guys.
Bob, how can you think the government owes anyone the amount of the deficit? It’s simply an accounting of how much they have spent into the economy that hasn’t been taxed back out.
@@murp0443It's amazing how people don't grasp that simple thing. "Look, the $5 in your pocket is yours!" -"When are they gonna pay me that $5 tho? And where dey gun git da money?"
@@murp0443 *Bob, how can you think the government owes anyone the amount of the deficit?*
Because the debt is owed typically as bonds, which pay interest. And the government has to repay the principle and interest in full, sh*t for brains. 😂
@@Richest_Person_in_the_World Wow, you're dumb. 😂
@@Richest_Person_in_the_World What does your idiotic babble even mean, Professor Sh*t For Brains?
How to become Argentina in a few easy steps.
MMT is the "Chase Check Glitch" of the elites
FOR ANYONE WITH A FUNCTIONING BRAIN, A 6 IS ALWAYS A SIX REGARDLESS OF HOW YOU LOOK AT IT
It's just a figure of speech, but it backfired. Y'all are literally coming back with "Wait, a 9 is not a 6."
@@Richest_Person_in_the_World It's not a "figure of speech". It's a perfect illustration of how idiotic your ideology actually is.
Peter Schiff is not a MMT advocate or did I hear him incorrectly?
Schiff 100% anti MMT.
They were saying Schiff was warning of the inflation that was coming and it wasn't transitory
Schiff's weird because he gets and doesn't get MMT at the same time. He for example ackowledges: "I need dollars to pay taxes."
Schiff definitely does not support MMT and doesn't acknowledge anything good about it. Is why lije many others who have staked out positions in the past and resist anything new that might be better.
@@tonysu8860Yeah he opposes it, but also Gets the part where USD is a tax credit. So it is actually bizarre that Schiff as a Dollar Hater actually thinks there "more to it" than what MMT says
If she’s right about taxpayers not being involved in the Fiat currency spending then why does the government need to tax anyone at all?
In order for the currency to have value
@@Richest_Person_in_the_World yeah right. 🤣
It's my understanding of the MMT theory that they envision a world where there are no taxes. It's crazy, but that's the theory.
We run this experiment in NZ. The results are in and it has been a disaster.
Access to cheap money at 0.25% OCR through the 2020 Quantitive Easing drove up house prices 30% by the end of 2021. It also drove up prices everywhere else within economy especially raw materials first as my encounters in the market place showed by the end of 2021.
Now this timeline is interesting for one good particular reason as it is Milton Friedman’s predicted inflationary timeline taking 18 months to two years to really show itself. It was spot on and things have been a struggle ever since. Fortunately I as able to fix my rate for a few years in mid 21 as I saw it coming.
We have been dealing with inflation ever since since at the time they called it “transitory”.
And now the vast majority of it is local inflation.
I see MMT as the height of government corruption as far as I am concerned. The way our government here used excuses like “child poverty” and “climate change” to just waste money and throw it at people to buy votes. Covid also, was not an issue here until 2022 and by then had mutated to a milder form. Government here employed thousands of people more on its coercion efforts.
I would think it was a bad dream if I had not been awake.
Weimar. Also Hungary after WWII etc.
Also Zimbabwe, and Venezuela, and Argentina pre-Milei.
"Jungary!" Wow just wow
I hope that was just your H key being close to the J key
Don't you think L. Randall Wray has thought of that, he is a Ph.D. in economics
@@Richest_Person_in_the_World Economics isn't a science, it is a finance scam. Great if you are on the right side of the grift ;-)
@@williambranch4283 Economics is the fundamental science, hoss. With it, you can buy and sell every physicist
I don't know if MMT is correct or not but your guest Bob Murphy immediately discredits himself with his initial analogy of Google issuing bonds. One of the fundamental parts of MMT is that when the government issues bonds it issues bonds in its own currency. The government also controls the currency so it can also print money to cover its debts. By printing money the government could cause inflation. That's why there's an emphasis on controlling inflation in MMT. In MMT you control inflation by raising taxes and raising interest rates.
The closest comparison for a corporation is probably Google issuing more stock. Google controls its stock so it can always issue more stock, but by issuing that stock it devalues the stock of the existing stockholders.
So either your guest just doesn't know what he's talking about or he's being intentionally misleading. I find in a lot of these conversations about MMT, the people who are trying to discredit it don't really take it seriously enough to actually study it so they can refute it.
Yes I was surprised that Bob Murphy is this intellectually inept
*That's why there's an emphasis on controlling inflation in MMT. In MMT you control inflation by raising taxes and raising interest rates.*
No there isn't... So the "fix" for the inflation that has crushed poor people in the US in recent years was to raise their taxes? Do they even pay taxes?
Or is the fix to raise taxes on the productive segments of the economy and cause a depression?
MMT theology is completely moronic... 😅🤣😂
@@willnitschke we don't have an administration that is practicing MMT right now. So the poor and middle class are just suffering under the current system.
If you really want to understand MMT then I suggest you read Stephanie kelton's the deficit myth.
Like I mentioned before, I don't know if the theory holds up. I think there are a lot of questions around if the government would actually respond if inflation got out of control under MMT.
But what I see is a lot of lazy responses to why MMT wouldn't work. Especially with so much dissatisfaction with the current system.
@@klf9161 I've looked at. It's nonsense. I have better uses of my time. This stuff is ideology. I'd ask you to ask yourself, why are you taking seriously the incoherent writings of a self published crank (Mosler) and grifters like Stephanie Kelton who is primarily out there promoting this stuff to achieve power and prestige. Now Kelton is no fool, but she's been serially wrong about the economic consequences of her ideas. What's happened in 2021-24 essentially refutes her.
At around 3:45 Bob is saying "Fine, so she claims govt debt is our asset! But wait, how do they intend to pay it to us!" Not understanding that it's already in your pocket 🤦♀️
Professor Sh*t For Brains, just because he notes what she claims, it doesn't follow that he agrees with it, obviously. Well, that's obvious to everyone except you.
@@willnitschkeStill, he asked when he was going to receive his asset. Where in reality, the asset is already in his bank
@@Richest_Person_in_the_World still wrong.
@@willnitschkeSo you deny that Bob Murphy owns dollars a.k.a. financial assets
@@Richest_Person_in_the_World Present actual coherent arguments rather than slogans, Professor Sh*t For Brains. You're a waste of everyone's time.
The real issue is commercial banks create money out of thin air and then charge interest on it lot of people don't realize this they think Banks loan out customers deposits but that's not how it works it's the craziest system.
Banks should be 100% full reserve banking meaning they can't loan out the money from deposits now there's other ways that they can loan out money but they will only have to loan out from funds and certain savings accounts credit for that.
Then what we could do is have the government print the money they need to run the office as a percentage of GDP maybe there'd have to be a lot of discussion on this but at that point if the government's going to print what they need we don't have to take out any more loans and pay interest on those loans then we could get rid of the Federal reserve we could get rid of the IRS and it would be a streamline good system. And then the money that is print into circulation by the government for roads or bridges or government pay or whatever they need then that money would be the inflation that you would see and then that inflation would be the tax but there would be to be some heavy constraints put on exactly how much money they could print each year.
And since they can only print so much per year they should also Congress should make it illegal for them to go ahead and sell bonds or treasury bonds so if they can't live within their means they can't just go and go oh you know we got a crisis or this happened or that happen we need to print money cuz there's always some crisis that they're having to print money for so that's going to come back to Congress and it should be on Congress not the Federal reserve
*The real issue is commercial banks create money out of thin air and then charge interest on it lot of people don't realize this they think Banks loan out customers deposits but that's not how it works it's the craziest system.*
Why is it "crazy" ? This is an assertion, not an argument.
And why should the cost of money be free anyway? Loaning money involves risk. Why should risk not be rewarded? Isn't expecting free money, more reasonably, "crazy" ?
*Banks should be 100% full reserve banking meaning they can't loan out the money from deposits now there's other ways that they can loan out money but they will only have to loan out from funds and certain savings accounts credit for that.*
Why?
*Then what we could do is have the government print the money they need to run the office as a percentage of GDP*
And if there is an economic crisis and GDP shrinks and there is a lack of liquidity in the system, and we're heading into Great Depression 2.0, then the governments hands are tied, and it can't actually react in the _one case_ where it might actually be able to do something useful, correct?
@willnitschke It would be up to Congress
It's not an assertion, it's a fact.
@@JohnDaniels Unfortunately for you, you don't get to decide what the facts are. Now you can _argue your case_ but since you've failed to do that, my observations stand, as you're unable to refute it.
@willnitschke there's nothing to refute
If you pun 6 and 9 together you get 69 and that still costs real money 🤑
We need to put the 99 percent into the 1 percent, as Ali G said
@@Richest_Person_in_the_World Well Ali G made a lot more sense than Mosler, anyway.
Debt is Wealth. Slavery is Freedom. War is Peace.
She already lost me right at the beginning, a six is still a six and a nine remains a nine no matter what angle you look at it. Just because you look at a six upside down, does not make it a nine, that is not how maths works, it the same way that having a 80085 on your calculator does not suddenly give you boobs. A trick of the mind does not suddenly represent reality.
Try is with actual real things, try looking at 6 cows at a different angle and see if you magically get 9, if you claim that people would call you crazy yet some people think MMT is sane.
The story is two people come on a number at the same time from different directions. Which person is right?
@@theBear89451 The person who actually spells out the right number, whatever the number is, a six CAN NOT be a 9 at the same time, that is a contradiction. It can either be a 6 or a 9, not matter what angle you look at it from, but not both.
The angle you view it from is completely irrelevant to whether a 6 is a 6 or a 9
If one is stating otherwise, they are at best performing voodo or at worst they are grifting, but they are NOT speaking truth.
If type a 6 on your laptop, and then turn the display around so it now looks like a 9, does that make it a 9? Of course not, its still a 6, you just have the display upside down. The computer will still interpret it as a 6, if you ad 1 to it you will get 7 and NOT 11 !!!
And the truth is, MMT is BS! They are just Grifters trying to confuse people with a economic sleight of hand (i.e. they are pretending that a 6 is a upside down 9, when it never was), its just designed to confuse people.
Abraham Lincoln once posed the question: 'If you call a dog's tail a leg, how many legs does it have? ' and then answered his own query: 'Four, because calling a tail a leg doesn't make it one,'
lolwut, teach me about the boob calculator trick
@@emperorpicard4901No, they are trying to explain a concept to people, but some are proving Dense
So a corollary to this is that I can build an apartment building without foundations anchored to the ground……?
This woman is a dangerous loon.
The TED speaker is flat wrong, but is also deceptively clever and 100% correct. Flat wrong about large Deficits being productive (scale matters here). Correct about concern about inflation. But implicitly the speaker is saying that deficits should be financed through higher taxes. That’s one way to do it, of course, and it results in a massive productivity drain on the economy.
Politically, because of the scale of the deficit, it has to be addressed with economic growth (low taxes), some modest fiscal restraint given our constitutional republic and inability to address entitlement programs, and price changes that are below the rate of economic growth, i.e. real growth must be positive. The USA does have the benefit of being the reserve currency for the world and there is nothing on the horizon currently to replace it. This actually helps the U.S. manage the problem.
By Stephanie Kelton's logic, the government should tax its citizens above 100% of their income. My god how the money rolls in.
No, MMT argues we are grossly overtaxed
Any video of her debating or getting pushback/friction on her theories?
I would love to put her and Peter Schiff in a faceoff. She would get shredded.
Schiff realizes that USD is a tax credit, but hasn't put 2 and 2 together that that is where 100% of its value comes from
@@Richest_Person_in_the_World Unfortunately for you, Schiff understands that 2 + 2 doesn't equal 64 billion, unlike you.
@@johndelia9408 Not her, but Warren Mosler (arguably the founder of MMT) has a debate on TH-cam against Bob Murphy. It's very good and a much better discussion around the merits and flaws.
6 vs 9 might be the most ridiculous argument I’ve ever heard.
She was trying to dumb it down after 10 years of not getting your eureka moment
@@Richest_Person_in_the_World Actually she was trying to dumb it up.
3:40 Absolutely amazing how Bob Murphy still doesn't get it. MMT explains that if the government "owes" $10,000 that is just the other side of your $10,000 checking account. But Murphy shouts: "And HOW do they plan to pay us then??" 🤦♀️
I've just come up with the briefest explanation: The fact that the government has a deficit, is proof that you already got paid.
MMT doesn't "explain" anything. It's just absurd Statist theology.
If the government goes into debt to issue food stamps, there is no asset to balance the debt. The poo in the toilet the next day, is not an asset that can zero the debt.
This stuff is sooooooooooo stupid. 😅🤣😂
@@Richest_Person_in_the_World the government doesnt need to be in debt for me to get paid tho lol.
there's a neat thing called a bond, and it's similar to holding stock in a company. The company doesn't need to go into debt to pay its workers.
@@neuxell You've just totally confused him...
@@neuxellA bond is just a bank account
MMT means that the govt limit on spending is inflation effects, not budgets and debt. BUT, inflation is a tax on the poor, inequality grows with each fiscal stimulus. AND, the people have to believe that spending by fiscal policy is helping people more effectively than they can help themselves. Insanity.
No, the issue is that the government created demand for fiat, by imposing taxes in fiat. Therefore it has to make sure there are sufficient amounts of currency to cover the liability they legislated
@@Richest_Person_in_the_World Everything the above commenter wrote was correct, and what you wrote was obviously idiotic.
Correct, MMT is essentially a flat tax on everyone, so the "poor" pay in equal measure to the wealthy. Given that the definition of "money printing" is creation of inflation, when MMTers claims inflation is a limit, the actual limit is the level of inflation the public will tolerate.
What is most curious about MMT ideology is that it's typically championed by Leftist types, although they are the very people being screwed by it. I would therefore speculate Leftism is a marker of low intelligence.
@@willnitschkeYou should trust the academia *ME*
@@Richest_Person_in_the_World Sorry, why would I trust the moronic rantings of an imbecile who exists in his own make believe land?
There is so much straw manning in this conversation from Bob Murphy. You should really get Stephanie Kelton on. That would be a great episode. A remember watching a debate years ago between Bob Murphy and a MMT proponent and Bob Murphy lost badly. It's like his neural pathways are so hardwired to see the world in a certain way that he doesn't have the mental agility to entertain any other perspective. It just doesn't compute for him.
I remember when I came across MMT for the first time after I had been wrestling to make sense of quantitative easing after the 2008 financial crisis. Using an MMT lens suddenly everything makes sense once you properly understand it, and you can't understand it listening to a second hand critique. Of course MMT economists can be wrong. They can make misjudgements like anyone else. But they do have the right framework for understanding how modern money works and not having that understanding can lead to big mistakes in policy making.
Yup!
Yes but back then Dr. Murphy could be excused because MMT was new. Now 10 years later he just looks unintelligent
Totally agree, but with respect to this video and countless others on the internet. The world would be such a better place - and people better informed - if there was more healthy debate, rather than one side poo pooing the other and vice versa. So I vote for inviting Stephanie onto the show.
Hello. I have to say that you are making a big mistake if you think they the proponents of MMT have a good understanding of the framework of modern money. Refer to my comment made in main chat. In essence they ignore the second side of the creation on money on the banks' Balance Sheet. Thanks
@@scottcincinnatikid9804 Have answered on your main comment
The only thing misleading here is your intentional misrepresentation of MMT. You clipped the most counterintuitive points of MMT and cut out the parts where she explained what she meant.
You said there's "nothing special" about the government compared to Apple. Yes there is! The United States is the issuer of the USD. USD is to the government as United Airlines flight miles are to United Airlines. If United Airlines dumps flight miles on into their market, it would reduce the value of the points only if United runs out of seats to sell. The number of planes they have is the limiting factor. This would equate to productive utility in the US economy. I'm not holding my breath given the other comments in this thread, but I'd encourage your viewers to be more critical and learn MMT from actual modern monetary theorists.
You want to try that again, but this time try to make some actual sense?
"be more critical and learn the subject from the primary propagandists"
So as long as a company has products, they'll never go broke??? 🤦
The United States does not issue USD.
The federal reserve does and it is not publicly owned nor does it provide a reserve.
How can people claiming to understand economics not get this?
@@wzl25 as long as they have products they can consistently sell at a profit then no no they won't. That's how business works
Recessions are part of the economic cycle, all you can do is make sure you're prepared and plan accordingly. I graduated into a recession (2009). My 1st job after college was aerial acrobat on cruise ships. Today I'm a VP at a global company, own 3 rental properties, invest in stocks and biz, built my own business, and have my net worth increase by $500k in the last 4 years.Read more
Let's face it... buying more stocks & index funds during stock market corrections and bear markets is scary. Which makes it really hard to do for most people like me. I have 260k i want to transfer into an s&p but it’s hard to bite the bullet and do it.
I agree, that's the more reason I prefer my day to day investment decisions being guided by an advisor seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not out-perform, been using my advisor for over 2years+ and I've netted over 2.8million.Read more
I agree, that's the more reason I prefer my day to day investment decisions being guided by an advisor seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not out-perform, been using my advisor for over 2years+ and I've netted over 2.8million.Read more
I agree, that's the more reason I prefer my day to day investment decisions being guided by an advisor seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not out-perform, been using my advisor for over 2years+ and I've netted over 2.8million.
I actually subscribed for a few trading courses but it didn't help much, been getting suggestions to use a proper financial advisor, how did you go about touching base with your coach?
She's right...
Can't believe I use to take this magazine seriously. So ignorant.
Facts hurt your feelings darling?
@ That doesn’t even make sense.
@@xancassiel6326 True, your confused angry feelings have nothing to do with thinking.
If Modern Monetary Theory worked, Venezuela would be the richest country in the world. Didn't Zimbabwe try MMT under its dictator, Robert Mugabe? The result: history's greatest hyperinflation.
Nobody said printing money produced real wealth.
However that equation works backwards too: real wealth is not a constraint on printing dollars,
therefore stop saying stuff like "We've run out of dollars."
@@Richest_Person_in_the_World You're clearly unfamiliar with the use of semi-colons with adjunctive adverbs.
@@ngana8755Not sure what you mean, but you certainly dodged the point. If moneyprinting is disconnected from real wealth creation, that only proves the U.S. can pay its bills.
@@Richest_Person_in_the_World Your brain fart makes zero sense. 😂
Absolutely absurd. Does the budget balance itself too? This lady is pure propaganda being used to gaslight us.
If the budget was always balanced, you would own $0 right now
@Richest_Person_in_the_World How's that? Not even a vague explanation.
@@Whowhatwherewhen5Because that $1 would have no way to make it into circulation. It would have been taxed away to cover the deficit.
@@Richest_Person_in_the_World No you wouldn't, you're an idiot, mate.
@@Whowhatwherewhen5 The only reason you have Dollars in your pocket is, because someone else is willing to take a loan. (The central bank for high powered money, others for other money). If nobody is willing to take a loan, you wouldn't have any money.
Argentina comes to mind when governments overspend. It doesn’t work to spend recklessly. Inflation is the hole in her argument.
There is no inflation in the U.S. and you've been screaming about the sky falling for 15 years
How can there be no inflation? If you put ten dollars under your mattress in 1980 that ten dollars will not buy you the same goods and services in 2024. The sky falls for countries that print their way out of financial troubles. The US has inflation it’s just not 1000% and crippling society.
@@E2680-l5yThe government aims to have 2% inflation and in reality they have 3%. Big whoopty doo. Can't you make an additional 3% annually?
@@Richest_Person_in_the_World 3% after 50%+... Perhaps you don't understand how compounding works... the effective rate since 2020 is way higher. Just because it went up 50 and then only 3% more of that...
It’s not about what is happening today it is about what could be if governments are irresponsible. Thats the entire argument, she said governments should spend without concern for consequences. There are consequences and examples are countries like Argentina. This isn’t about getting an extra percent return in personal finance, that is narrow minded thinking. This is about policy and the impacts it has on society.
we do not have a gold standard economy
Thank you Captain Obvious.
@@willnitschkeSo you admit that dollars don't have to be dug up out of mines
@@Richest_Person_in_the_World What are you babbling about now, Professor Sh*t For Brains?
If the government can find all this money and it isn’t a problem why are the roads and infrastructure falling apart?
Lack of roadbuilders. Though color me skeptical that U.S. roads are bad
An MMT fruit-cake would reply, because the government hasn't printed enough dollars yet! 😅
I don't think theres any surprise this thinking would come from the US, the country with millions of overweight people that flock to any drug that will promise weight loss with no exercise or dieting. MMT is the drug that promises pizza and icecream for all without austerity.
@@Relaxingpeacefulcalming Lame
@@Richest_Person_in_the_World you should try a weight loss drug :^) because for some reason exercise and dieting isnt working for you
you're absolutely spot-on. That is the modern American thinking: don't bother checking the nutrition of your soda, otherwise you might see that chugging sodas 24/7 is why you're overweight. Don't bother dieting or exercising, as that requires real effort... instead, just believe what the "experts" tell you to believe.
I’ve read Stephanie Kelton’s book, the deficit myth, and I have watched the documentary called finding the money which is about MMT. I encourage people to read it and watch it have a Copernicus moment.
Elon needs to buy TH-cam......
You might also want to then explore Dianetics by L. Ron Hubbard and Chariots of the Gods by Erich von Däniken. That way you're won the trifecta. You'll remain totally ignorant of how anything in the real world works of course, but this won't stop you from writing lots of utube comments about how you're now an expert in economics, psychology and archaeology.
Legit, I even watched some Mosler classes on other video platforms
@@Richest_Person_in_the_World Wow, you almost paid attention to two podcasts. Like all idiots, you now consider yourself a genius in economics.
We are being colonized by Global corporations who only think about maximizing profits. We will be taxed into poverty to pay for the
infrastructure and services for these millions of new consumers. They will get UBi to buy clothes and iPhones. We pay for the healthcare and daycare of the low wage employees of Costco and McDonalds. We subsidize the profits of Global corporations. The goal is to make us all poor through inflation so that we have to sell our homes at a discount. Then we will own nothing.
We will have no economic leverage against
Global corporations who own Western governments. We will all be ens/aved. Mass immigration is the path to neo-feudalism. When we live from paycheck to paycheck, we have no way to resists against corporations sending our kids to fight their imperial wars.
Corporations are people my friend
Yet half the economy is small businesses...
Host, is this channel receiving any financial incentive to put out this video by anyone other than TH-cam advertising (assuming you’re not allowed to chose the advertising, save maybe for eliminating certain advertising categories like Manscapers, etc)?
I think the deficit is the enemy to focus on, while others rob us blind.
When the interest on the deficit is as much as the the yearly budget than things will go bad
No because they can simply print the interest. Typing $1 and 1T (meaning one trillion) is equal work
@@Richest_Person_in_the_World Which would cause inflation to explode and destroy the US. Thank you for your stupid comment, Professor Sh*t For Brains.
@@willnitschkeAnd yet inflation is muted this year, after you've gone gray announcing a hyperinflation. 😅
@@Richest_Person_in_the_World Professor Sh*t For Brains, that's like saying because the government stole 90% the money in your bank account, it's OK, because they're only stealing a smaller amount this year. 😅
She’s right in that government deficits go into the economy. And those people are the politically well connected who are wealthy to begin with.
So? Rewarding the wealthy is a good idea per Austrianism
You need to understand MMT if you wish to become one of us (Top 1%) >__< And Runaway from Rich Dad, Poor Day
This woman is insane, and her economics will destroy the country.
She is not insane.... Advocating for this sort of nonsense gives her status, power, influence, etc. It actually takes a great deal of intelligence and sanity to argue for something as dumb as MMT. Probably something along the lines of 'evil' or 'corrupt' would be closer to the mark.
Once again Murphy's response is to try to compare government finance to our personal or Google's finance. Neither we nor Google can create money and the government can. We have been doing it since 1790. Just because our government is making an effort to borrow. It really does not have to do it. Why should the government borrow money that only it can produce? We borrow because that is what we did to keep the outstanding money supply equal to gold reserves during the days of the gold standard. We kept doing it because investing in government securities was popular so they just kept it going in order to provide holders of dollars a safe place to keep them. Murphy is quick to mention about the recent bout with inflation without ever talking about what would have happened had we not did the spending. Murphy is not honest with his criticism. Our so-called government debt is nothing more that the amount of money that our government has invested into our economy and not taxed back since 1790. That entire amount of money did not just disappear it still sits in the pockets of the private sector. If the government never spent a dime we would have no money at all. All wealth within our economy was created by government spending (investing). Where else could it have come from?
Yeah. I would phrase a couple of things a bit differently, such as your problematic wording "government has invested into our economy" and "all wealth was created by them." It's actually that they first created Tax Liabilities, and only for that reason we are in need for them to also create the Tokens for Satisfying those liabilities a.k.a. to create enough dollars.
@@Richest_Person_in_the_World Well its good to see that you understand why we are taxed. But that has little to do with what I said. Perhaps you are correct, I could have worded my comment differently. What I should have said is that all wealth in our country originated with our government spending, investing, currency into our economy. That is not to say, that the wealth within our economy is equal to the amount of currency that our government spent. It is just a statement that our economy from the very beginning was fed by our government spending, i.e., our government injecting, investing, currency into it. Once circulating it multiplies. Our money supply is composed of all of the outstanding currency and all the liquid assets held by the private sector. Banks create wealth every time they transact a loan, but the money they lend entered the system through government spending. Wealth created through bank transactions is called credit, credit far exceeds outstanding currency in our country, but it all started with government spending. How else can currency enter our economy. If you think that I am wrong please show me how.
*Once again Murphy's response is to try to compare government finance to our personal or Google's finance.*
You have already been spanked on this ideological talking point multiple times. But you refuse to learn.
Once again you confuse an abstract concept 'the government' with its actual citizens. Yes a government that prints its own currency can never go 'bankrupt' on its balance sheet. This is because it can simply credit capital and debt assets. Now, if a private entity lodged returns and did that, the CFO would go to jail.
So in summary, again, a government's balance sheet can always and at all times look pristine, while at the same time the citizenry are ground into devastating impoverishment.
You can recycle this talking point over and over again, but the only people you are going to sell it to, are other morons, sorry.
@@willnitschke Please expound on how our so-called debt impoverishes the citizenry? The abstract concept is not abstract at all. A Fiat system are different from commodity backed system, We are under a Fiat System, a fact that you refuse to accept. All MMT does is tells us that we are not using that system to its fullest advantage. In stead of the CBO worrying about whether a bill adds to our so-called deficit, it would be more effective if its job was figure out if it is inflationary. If there are idle resources available for using, we should use them without causing inflation or crowding out. Tell me where that is incorrect? th-cam.com/video/N8HOWh8HPTo/w-d-xo.html
@@BanBb1 I'm sorry, but you sound literally like a delusional moron. So Wiemar Republic, Zimbabwe, Yugoslavia... massive money printing. What happened to the citizens?
MMT doesn't tell us anything. It's just brain dead theology pretending to be economics. Governments, particularly in advanced economies, are always horrifically bad at capital allocation. A government bureaucrat is not going to magically decide what he feels are "idle resources" and "fix" the "problem." That's not the role of the government, and it's only an assertion made by an economically illiterate imbecile. Capital allocation is the role of venture capital, among other entities in the private sector. Some of these people are incredibly smart, but still loose money most of the time. The incompetent clowns with government jobs have no hope.
In 1967 my father bought our first family home for $15,500. He earned $7,500 per year as an autobody repairman. Last year, the house across the street from our old home sold for $989,000. My father would have to earn $450,000 a year to buy the same house in 2024.
Thank your government for that.
I'm not sure that's how it works, that 1/2 of your annual salary has to equal your home. Rather you take a look at which mortgages you and your spouse can afford.
@@Richest_Person_in_the_World Which thanks to MMT style policies, is increasingly becoming almost nobody.
Printing money is used supposedly to make jobs, BUT, we know from global experience that when the economy slows down, that hiring people to dig holes and then paying them to fill them in and then dig again and fill again is what China has been doing since 2015 by building over 200 entire cities that are empty. Now, that has caused a massive bubble that is now bursting and is destroying the economy. That’s what the craziness of MMT does.
Yes but MMT explains that the government created unemployment
The principle of MMT is that you need to manage inflation using taxes and monetary policy. I don’t know anyone who says otherwise. By the way, inflation was not just a US problem, in fact the U.S. managed inflation much better than most other developed countries. I think the bigger problem is the almost Trillion dollars spent on Defence, failing its 7th audit and we are still increasing the Defence budget.
*I don’t know anyone who says otherwise.*
Then presumably your bubble consists of idiots. Inflation is created via fiscal policy. Monetary policy is like a sledge hammer that then tries to put a break on what fiscal policy is screwing up.
*By the way, inflation was not just a US problem...*
True, it was a problem wherever governments copied what the US did. Incredible, huh?
*I think the bigger problem is the almost Trillion dollars spent on Defence*
Whatever you think of defense, debt servicing (interest payments on the debt) now exceed defense spending. So maybe the _actual_ bigger problem is how we got into this mess, and why we continue to dig ourselves into a deeper hole. Maybe that's what needs to be fixed, first.
7:04 “…we just need to keep spending.” Come on…That’s not what she said, at all.
Why wouldn’t you have a person who actuallly understands MMT on to rebut what this fool is vomiting. He either doesn’t know or is dishonest.
Because he does understand MMT (as far as nonsense can be understood). Your hurt feelings don't matter.
@@willnitschkeHe does not. And it's been years. Just lol at your IQ
@@willnitschke ya so accounting is nonsense?
@@mandypants226 If you want to debate me, first begin by NOT assigning stupid assertions that I never made, to me, in the desperate hope that I will let that fly. That's the hallmark of a half wit, sorry.
By her logic, there's zero need for taxes. After all, taxes are the result of the government needing money but if the government can just print any amount of money it needs, then there's no need to tax it's people. This woman throws out the entire understanding that scarcity creates value. The more printing, digital or otherwise, of money, reduces it value. I've had discussions with a number of people that refuse to understand this fact. It's the entire reason the government turned to taxation in the first place. It's why people hold value in digital currency like Bitcoin. She talks about how government needs to work on limiting inflation instead of debt, but immediately advocates for a massive factor in creating inflation.
Strictly speaking you could replace income and consumption taxes with currency debasement. This approach is not illogical. It's in fact what governments are constantly doing anyway. However, if you are going to switch to currency debasement alone, you've just swapped out one set of taxes for another.