Australian Politics Forum - Modern Monetary Theory (MMT)

thegreatdivide

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Re: Modern Monetary Theory (MMT)
Reply #645 - Oct 15^th, 2023 at 6:58pm

Frank wrote on Oct 15^th, 2023 at 4:06pm:

thegreatdivide wrote on Oct 15^th, 2023 at 2:13pm:

Frank wrote on Oct 15^th, 2023 at 1:39pm:

thegreatdivide wrote on Oct 14^th, 2023 at 1:37pm:

The approaching defeat of the referendum is a good time to reflect on the reasons for its defeat.

Egg-head lawyers (including from the UN down) armed with illusory "human rights" theory (eg Megan Davis) support the divisive concept of "indigenous land rights" accruing to a section of the population.

The only "right" re property/land-ownership worthy of consideration, is the 'right' to housing - for everyone.
But lawyers don't do economics, they apparently think a house for everyone is unachievable.

And then there's the necessity for everyone who wants a job to have access to work in order to prosper, as the blacks in Wyndham have been calling for, just last week.
They expressly said they don't want government handouts.

It's time for governments to take control of the nation's resource mobilization, as far as necessary to deal with the egregious disadvantage entrenched by the 'invisible hand' market.

The so-called 'welfare' safety net is really only a poverty industry, whose employees are riding the gravy train, while those forced to subsist on the unemployment scrap-heap are thrown some crumbs.

Six-Year-Old Saying, 'Why Don't We Just Give Everything Away For Free?' Surges To Top Of Democratic Polls

https://media.babylonbee.com/articles/article-4655-1.jpg

U.S. - A new candidate has come out of nowhere to surge in the polls in the Democratic primary, and she's only six years old. Susie Peters of Minneapolis, Minnesota, was on a local news segment where children gave their opinions on world problems, and she asked, "Why can't we just give everyone everything they want for free?" The message quickly went viral and really resonated with Democratic voters, propelling Susie from unknown to third in most polls, ahead of Bernie Sanders and just behind Elizabeth Warren and Joe Biden.

"She really has a plan for everything," said Melinda Carlson, one of Susie's enthusiastic supporters. "While Elizabeth Warren only has a plan for getting people free health care and free college, Susie has a plan to get everyone free everything. She's truly a visionary."

Her new candidacy has upset some of the other candidates, with Bernie Sanders accusing Susie of stealing all his ideas. Others say the math in her plans doesn't add up, to which Susie says she doesn't like math and instead likes "Twilight Sparkle." And President Trump has taken notice, vowing to trounce Susie in the general since Trump himself can "read and write at the level of an eight-year-old." There are also concerns Susie may be gaffe-prone like Joe Biden, as one day at school Susie referred to her teacher as "Mommy" by mistake, prompting a round of laughter from her classmates.

Still, Susie has unveiled her new popular campaign slogan, "But I want it!" and has already qualified for the next Democratic presidential debate, though she may not be able to attend since it will be on past her bedtime.

Priceless....but as a six year old, "Susie" is entitled to be ignorant of economic realities like the limit to available resources**, and the role of monetary incentive in productivity.

But as an adult you are NOT entitled to blindly follow mainstream neoclassical obsolescence, as currently followed by the World's Reverse Banks worshipping the greed-based 'invisible hand' free-market.

**it's resources which are limited, not money - which is unlimited for a currency-issuer...obviously.

Do try to keep up.

What does money represent?

The important word there is "represent" - and the answer is: value, ie money is a MEASURE of value, not the instrinsic value of the goods or services themselves, which the nation produces (some of which is less than worthless, for the ill-health it causes).

The key to understanding the problem is recognizing that in our current economic system, "value" (as measured by money) is determined in invisible hand markets, whereas governementnts need to manage resource mobilization by intervening in the market, to ensure the common welfare - NOT the same as 'equality of outcome'.

So.... back to 'closing the gap', via education, housing and jobs for all; money is not the problem, intelligent mobilizatioin of the nation's available resources labour. resources) is.

Admittedly, MMT theorists have often ignored the significance/role of the 'invisible hand' market, as the determinant of "value".

Hence they too resort to proposing taxation and/or interest rates as methods of inflation control, rejected by politicians who don't like lifting either because they want to get re-elected.....

...and the polies lose either way; centre left parties always eventually get turfed out (as in NZ today) because they never deliver on their promises to decrease disadvantage and increase the common welfare; and centre right parties always fail to properly maintain desired pubic services - as in the UK which is why the Conservatives will be turfed out (like Morrison here).

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Frank Gold Member Online Australian Politics Posts: 44634 Gender:	Re: Modern Monetary Theory (MMT) Reply #646 - Oct 15^th, 2023 at 8:21pm What does money represent?
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thegreatdivide

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Re: Modern Monetary Theory (MMT)
Reply #647 - Oct 15^th, 2023 at 9:31pm

Frank wrote on Oct 15^th, 2023 at 8:21pm:

What does money represent?

Short version: money represents value, determined (in our system) in competitve 'invisible hand' markets but is not value itself, eg the intrinsic value of a piece of music, or a job done.

More detailed analysis:

...value measured in terms of national currencies, eg dollars, yuan, euros, yen, rupees, pounds etc etc

[But ecological economists are beginning to consider the limitations and drawbacks of GDP as a measure of the value of a nation's output and 'wealth].

Like measuring the comparative 'value' of the players in competitive sports, represented by goals*** scored by the players; there is of course an unlimited supply of goals which are created ex nihilo as required (the 'value' measure) which the scorekeeper can draw on, to be able to declare the winner of the game.

*** the goals themselves are mere numbers/signs on a score-board, these numbers/signs themselves have no 'value', it's the exertion and skill which resulted in the goal which has the 'value'.

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« Last Edit: Oct 15^th, 2023 at 10:00pm by thegreatdivide »

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thegreatdivide

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Re: Modern Monetary Theory (MMT)
Reply #648 - Oct 16^th, 2023 at 9:37am

thegreatdivide wrote on Oct 14^th, 2023 at 1:37pm:

The approaching defeat of the referendum is a good time to reflect on the reasons for its defeat.

Egg-head lawyers (including from the UN down) armed with illusory "human rights" theory (eg Megan Davis) support the divisive concept of "indigenous land rights" accruing to a section of the population.

The only "right" re property/land-ownership worthy of consideration, is the 'right' to housing - for everyone.
But lawyers don't do economics, they apparently think a house for everyone is unachievable.

And then there's the necessity for everyone who wants a job to have access to work in order to prosper, as the blacks in Wyndham have been calling for, just last week.
They expressly said they don't want government handouts.

It's time for governments to take control of the nation's resource mobilization, as far as necessary to deal with the egregious disadvantage entrenched by the 'invisible hand' market.

The so-called 'welfare' safety net is really only a poverty industry, whose employees are riding the gravy train, while those forced to subsist on the unemployment scrap-heap are thrown some crumbs.

I forgot to say how the government can contain inflation, if in fact, currency-issuing governments authorize Treasury to create debt-free money to fund public expenditures:

In a scenario of mandated full employment (Job Guarantee, JG) and (near) zero interest rate monetary policy (ZIRP), inflation is manged directly via price controls, and rationing (when necessary because of supply failures).

Thus freeing governments from having to raise politically toxic taxes, and 'independent' central banks raising economy-wrecking interests rates.

...a step too far for 'invisible hand' market ideologues; so it's time to ditch over-reliance on that ideology.

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Frank

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Re: Modern Monetary Theory (MMT)
Reply #649 - Oct 16^th, 2023 at 9:53am

thegreatdivide wrote on Oct 15^th, 2023 at 9:31pm:

Frank wrote on Oct 15^th, 2023 at 8:21pm:

What does money represent?

Short version: money represents value, determined (in our system) in competitve 'invisible hand' markets but is not value itself, eg the intrinsic value of a piece of music, or a job done.

More detailed analysis:

...value measured in terms of national currencies, eg dollars, yuan, euros, yen, rupees, pounds etc etc

[But ecological economists are beginning to consider the limitations and drawbacks of GDP as a measure of the value of a nation's output and 'wealth].

Like measuring the comparative 'value' of the players in competitive sports, represented by goals*** scored by the players; there is of course an unlimited supply of goals which are created ex nihilo as required (the 'value' measure) which the scorekeeper can draw on, to be able to declare the winner of the game.

*** the goals themselves are mere numbers/signs on a score-board, these numbers/signs themselves have no 'value', it's the exertion and skill which resulted in the goal which has the 'value'.

So government prints value what it prints money.

Magic.

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thegreatdivide

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Re: Modern Monetary Theory (MMT)
Reply #650 - Oct 16^th, 2023 at 10:40am

Frank wrote on Oct 16^th, 2023 at 9:53am:

thegreatdivide wrote on Oct 15^th, 2023 at 9:31pm:

Frank wrote on Oct 15^th, 2023 at 8:21pm:

What does money represent?

Short version: money represents value, determined (in our system) in competitve 'invisible hand' markets but is not value itself, eg the intrinsic value of a piece of music, or a job done.

More detailed analysis:

...value measured in terms of national currencies, eg dollars, yuan, euros, yen, rupees, pounds etc etc

[But ecological economists are beginning to consider the limitations and drawbacks of GDP as a measure of the value of a nation's output and 'wealth].

Like measuring the comparative 'value' of the players in competitive sports, represented by goals*** scored by the players; there is of course an unlimited supply of goals which are created ex nihilo as required (the 'value' measure) which the scorekeeper can draw on, to be able to declare the winner of the game.

*** the goals themselves are mere numbers/signs on a score-board, these numbers/signs themselves have no 'value', it's the exertion and skill which resulted in the goal which has the 'value'.

So government prints value what it prints money.

Magic.

Com'on Frank, you can do better than that.

At least write something with parsable (and passable) grammar.

Let's go with "So government prints value when it prints money."

Wrong of course.

1. When government "prints' money, it is currently obliged to create an equivalent debt which must be repaid to private sector financiers.

2. Government creates value when it funds education and infrastructure. The question is - where do, or COULD, the required funds come from?

https://ideas.repec.org/a/eee/finana/v36y2014icp1-19.html

This paper presents the first empirical evidence in the history of banking on the question of whether banks can create money out of nothing. The banking crisis has revived interest in this issue, but it had remained unsettled. Three hypotheses are recognised in the literature. According to the financial intermediation theory of banking, banks are merely intermediaries like other non-bank financial institutions, collecting deposits that are then lent out. According to the fractional reserve theory of banking, individual banks are mere financial intermediaries that cannot create money, but collectively they end up creating money through systemic interaction. A third theory maintains that each individual bank has the power to create money ‘out of nothing’ and does so when it extends credit (the credit creation theory of banking). The question which of the theories is correct has far-reaching implications for research and policy. Surprisingly, despite the longstanding controversy, until now no empirical study has tested the theories. This is the contribution of the present paper. An empirical test is conducted, whereby money is borrowed from a cooperating bank, while its internal records are being monitored, to establish whether in the process of making the loan available to the borrower, the bank transfers these funds from other accounts within or outside the bank, or whether they are newly created. This study establishes for the first time empirically that banks individually create money out of nothing. The money supply is created as ‘fairy dust’ produced by the banks individually, "out of thin air".

"Magic".....

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Frank

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Re: Modern Monetary Theory (MMT)
Reply #651 - Oct 16^th, 2023 at 11:49am

thegreatdivide wrote on Oct 16^th, 2023 at 10:40am:

Frank wrote on Oct 16^th, 2023 at 9:53am:

thegreatdivide wrote on Oct 15^th, 2023 at 9:31pm:

Frank wrote on Oct 15^th, 2023 at 8:21pm:

What does money represent?

Short version: money represents value

So government prints value when it prints money.

Wrong of course.

So it is both:
Money represents value
Money doesn't represent value.

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thegreatdivide

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Re: Modern Monetary Theory (MMT)
Reply #652 - Oct 16^th, 2023 at 5:58pm

Frank wrote on Oct 16^th, 2023 at 11:49am:

thegreatdivide wrote on Oct 16^th, 2023 at 10:40am:

Frank wrote on Oct 16^th, 2023 at 9:53am:

thegreatdivide wrote on Oct 15^th, 2023 at 9:31pm:

Frank wrote on Oct 15^th, 2023 at 8:21pm:

What does money represent?

Short version: money represents value

So government prints value when it prints money.

Wrong of course.

So it is both:

Incorrect

Quote:

Money represents value

Correct

Quote:

Money doesn't represent value.

Incorrect; oh dear - the incapacity of the Conservative brain....

The goal analogy went straight over your head; ie goals - created out of thin air by the score-keeper - measure REAL value, ie, a level of skill , but has no value in itself, as proved by the fact the goals on the scoreboard are created our of thin air (ie they are unlimited and therefore have no value).

Imagine a society which has decided to operate without money as a representation of value, by listing wages earned in particular occupations in terms of payment in essential goods and services, and then (for the more talented workers, and "incentive"), increasing access to non-essentials goods and services, in an entirely planned economy.

Those goods and services maintain their value (as listed in terms of actual goods and services earned by workers), even though this value is not measured in monetary terms.

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Frank

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Re: Modern Monetary Theory (MMT)
Reply #653 - Oct 16^th, 2023 at 6:15pm

thegreatdivide wrote on Oct 16^th, 2023 at 5:58pm:

Frank wrote on Oct 16^th, 2023 at 11:49am:

thegreatdivide wrote on Oct 16^th, 2023 at 10:40am:

Frank wrote on Oct 16^th, 2023 at 9:53am:

thegreatdivide wrote on Oct 15^th, 2023 at 9:31pm:

Frank wrote on Oct 15^th, 2023 at 8:21pm:

What does money represent?

Short version: money represents value

So government prints value when it prints money.

Wrong of course.

So it is both:

Incorrect

Quote:

Money represents value

Correct

Quote:

Money doesn't represent value.

Incorrect; oh dear - the incapacity of the Conservative brain....

The goal analogy went straight over your head; ie goals - created out of thin air by the score-keeper - measure REAL value, ie, a level of skill , but has no value in itself, as proved by the fact the goals on the scoreboard are created our of thin air (ie they are unlimited and therefore have no value).

Imagine a society which has decided to operate without money as a representation of value, by listing wages earned in particular occupations in terms of payment in essential goods and services, and then (for the more talented workers, and "incentive"), increasing access to non-essentials goods and services, in an entirely planned economy.

Those goods and services maintain their value (as listed in terms of actual goods and services earned by workers), even though this value is not measured in monetary terms.

🤣🤣🤣🤣🤣

Waffle. Bilge. Idiocy. Incoherent crap.

Sorry, correction. Waffle one. Bilge one. Idiocy one. Incoherent crap one.

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thegreatdivide

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Re: Modern Monetary Theory (MMT)
Reply #654 - Oct 17^th, 2023 at 10:21am

Frank wrote on Oct 16^th, 2023 at 6:15pm:

thegreatdivide wrote on Oct 16^th, 2023 at 5:58pm:

Frank wrote on Oct 16^th, 2023 at 11:49am:

thegreatdivide wrote on Oct 16^th, 2023 at 10:40am:

Frank wrote on Oct 16^th, 2023 at 9:53am:

thegreatdivide wrote on Oct 15^th, 2023 at 9:31pm:

Frank wrote on Oct 15^th, 2023 at 8:21pm:

What does money represent?

Short version: money represents value

So government prints value when it prints money.

Wrong of course.

So it is both:

Incorrect

Quote:

Money represents value

Correct

Quote:

Money doesn't represent value.

Incorrect; oh dear - the incapacity of the Conservative brain....

The goal analogy went straight over your head; ie goals - created out of thin air by the score-keeper - measure REAL value, ie, a level of skill , but has no value in itself, as proved by the fact the goals on the scoreboard are created our of thin air (ie they are unlimited and therefore have no value).

Imagine a society which has decided to operate without money as a representation of value, by listing wages earned in particular occupations in terms of payment in essential goods and services, and then (for the more talented workers, and "incentive"), increasing access to non-essentials goods and services, in an entirely planned economy.

Those goods and services maintain their value (as listed in terms of actual goods and services earned by workers), even though this value is not measured in monetary terms.

🤣🤣🤣🤣🤣

Waffle. Bilge. Idiocy. Incoherent crap.

Sorry, correction. Waffle one. Bilge one. Idiocy one. Incoherent crap one.

Sorry Frank ...you doing a Lisa - not a good look.

Money is created out of thin air*** (whether in private banks or the nation's Treasury); unfortunately the goods and services we want and need are NOT created out of thin air ("ex nihilo")....

***since English is your first language, you are only required to engage your brain: "money is created ex nihilo".... the meaning is clear (unlike with McGowan's translator).

So the currency-issuing government should use the former reality to facilitate the latter; ie, mobilization of available resources, to eradicate the entrenched poverty resulting from greed-based 'invisible hand' markets.

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« Last Edit: Oct 17^th, 2023 at 10:34am by thegreatdivide »

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thegreatdivide Gold Member Offline Australian Politics<br /> Posts: 12480 Gender:	Re: Modern Monetary Theory (MMT) Reply #655 - Oct 18^th, 2023 at 9:17am Today in Parliament: Senator Scarr (Liberal) praising Milton Friedman, despite the total failure of the 'invisible hand' housing market to supply affordable housing for all Australians. Disgusting, obsolete neoliberal ideology, serving the interests of the rent-seekers. "Deplorable".
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thegreatdivide

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Re: Modern Monetary Theory (MMT)
Reply #656 - Oct 22^nd, 2023 at 11:50am

From a twitter feed today;

"Under the Econ assumption that we’re all utility maximizers and rational actors means Econs can’t be trusted in their policy recommendations as they’re optimizing for themselves. Follow the money (or professional awards you mention)."

and:
(from 'Moral Money Time'):

Outsiders (eg MMTers) can say whatever they want. But people on the inside don’t listen to them. Insiders, however, get lots of access and a chance to push their ideas... But insiders also understand one unbreakable rule: They don’t criticize other insiders."
~ Larry Summers to Liz Warren

The mainstream greed-based invisible hand market wouldn't know 'moral money', by definition.

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Frank

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Re: Modern Monetary Theory (MMT)
Reply #657 - Oct 22^nd, 2023 at 5:34pm

thegreatdivide wrote on Oct 22^nd, 2023 at 11:50am:

From a twitter feed today;

"Under the Econ assumption that we’re all utility maximizers and rational actors means Econs can’t be trusted in their policy recommendations as they’re optimizing for themselves. Follow the money (or professional awards you mention)."

and:
(from 'Moral Money Time'):

Outsiders (eg MMTers) can say whatever they want. But people on the inside don’t listen to them. Insiders, however, get lots of access and a chance to push their ideas... But insiders also understand one unbreakable rule: They don’t criticize other insiders."
~ Larry Summers to Liz Warren

The mainstream greed-based invisible hand market wouldn't know 'moral money', by definition.

That authoritative - for parrots.

Are you investing your money in Hamas bonds or Islamic Jihad bonds? You are morally on their sides so you must have your money where your beak is.

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thegreatdivide

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Re: Modern Monetary Theory (MMT)
Reply #658 - Oct 23^rd, 2023 at 8:58am

Frank wrote on Oct 22^nd, 2023 at 5:34pm:

thegreatdivide wrote on Oct 22^nd, 2023 at 11:50am:

From a twitter feed today;

"Under the Econ assumption that we’re all utility maximizers and rational actors means Econs can’t be trusted in their policy recommendations as they’re optimizing for themselves. Follow the money (or professional awards you mention)."

and:
(from 'Moral Money Time'):

Outsiders (eg MMTers) can say whatever they want. But people on the inside don’t listen to them. Insiders, however, get lots of access and a chance to push their ideas... But insiders also understand one unbreakable rule: They don’t criticize other insiders."
~ Larry Summers to Liz Warren

The mainstream greed-based invisible hand market wouldn't know 'moral money', by definition.

That authoritative - for parrots.

Are you investing your money in Hamas bonds or Islamic Jihad bonds? You are morally on their sides so you must have your money where your beak is.

I'm invested in miners extracting minerals for the green transition.

Meanwhile, this thread is to educate the likes of you: government must take command of a portion of the nation's resources**, BEFORE the private sector has its greed-based ways with those resources....

** ie real resources, as opposed to money which is always created out of thin air (whether in private banks, or the nation's treasury).

Obviously - first principles - government must guarantee education, housing and jobs for everyone, to avoid private sector competition creating winners and losers - from billionaires to losers forced onto the poverty-level 'welfare' safety net...

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« Last Edit: Oct 23^rd, 2023 at 9:33am by thegreatdivide »

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thegreatdivide

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Re: Modern Monetary Theory (MMT)
Reply #659 - Oct 27^th, 2023 at 9:02am

From a tweet today, (as I have been saying all along in this thread):

@RafelCarretero
(Rafel Carretero) Professor, Llicenciat en Administració i Direcció d'Empreses.
Teoria Monetària Moderna.
·
10h
The budget deficit should be viewed as a policy tool, not as a policy target. The government is not a household and should not be likened to one; it is a vehicle for societal collective action. Its job is to serve the people, not balance its books.

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