Frank wrote on Mar 25^th, 2024 at 3:45pm:


Er... these 'investors' (creditors) seek profits in loans; the promises of the borrowers are moot.  Ask any banker.

Mainstream economists getting annoyed; see this tweet from Chief Economist and Global Strategist, Peter Schiff:
.....

Nonsense from @StephanieKelton on @CNBC that spending drives economic growth. She has the cart before the horse. Economic growth drives spending. Growth comes from savings and production. You can't buy what hasn't been produced. Spending printed money just drives prices higher.

....

Questions for prof. Schiff:

1. "Economic growth drives spending".

Well ....yes, but what causes economic growth?

If the government needs infrastructure to grow the economy, where is the required spending on the infrastructure going to come from?

2. "Growth comes from savings and production".

From production, yes; but where do savings come from?

eg, a bank doesn't need customers' savings before the bank can begin writing loans (for credit-worthy customers).

3. "You can't buy what hasn't been produced".

Correct.....but the government can buy resources which are available for purchase.

Is Schiff confusing himself with a currency-issuing government?

4. "Spending printed money just drives prices higher".

Spending wage and salary money can also drive prices higher, if supply is limited, or demand is excessive.

So.... prof. Schiff: who has "the cart before the horse"? 

Tweet from Monetary Policy Institute:

https://medium.com/@monetarypolicyinstitute

"Provocative title: "European Union: Austerity for the people, and Keynesianism for the war"

by Riccardo Zolea

“The king is naked and mainstream economic thinking is weaker than ever.”
......

Funny how governments can find money for war without causing inflation, but money for education, public housing, hospitals and infrastructure causes inflation....

Max von Thun
@maxvonthun

Mar 11 2024

A striking and very welcome mea culpa from Nobel prize-winning economist Angus Deaton - in the IMF of all places - on how economics lost its way by ignoring corporate power, downplaying ethics, stigmatising unions and fetishising efficiency.

More evidence of the dysfunction at the heart of mainstream orthodox economics:

https://www.msn.com/en-au/news/other/argentinian-president-javier-milei-s-bold-p...

Argentinian President Javier Milei's bold plan to cut 70,000 government jobs
.......

Good luck with that.....

So forcing 70,000 government workers into poverty is a "bold" move....according to sick orthodox bastards.

Even while the private sector is also cutting jobs because high inflation is destroying workers' purchasing power.

And last night on the ABC's RN 'Nightlife" program,  two comfortable old fools   - Philip Clarke (host)  and Ian Verrender, (the ABC's "business editor"); were laughing about the apparent madness of ecomomics which asserts we "need" higher unemployment to get inflation well into the CB's preferred 2-3% range ........laughing because they accept that particular insane dogma. 

Madness - largely based on extrapolating the micro- into the macro-economic field - as Frank does, claiming the individual is the community.  

thegreatdivide wrote on Mar 29^th, 2024 at 2:34pm:



A peculiar thing about the Puddin' was that, though they had all had a great many slices off him, there was no sign of the place whence the slices had been cut.

'That's where the Magic comes in,' explained Bill. 'The more you eats the more you gets. Cut-an'-come-again is his name, an' cut, an' come again, is his nature. Me an' Sam has been eatin' away at this Puddin' for years, and there's not a mark on him. Perhaps,' he added, 'you would like to hear how we came to own this remarkable Puddin'.'

'Nothing would please me more,' said Bunyip Bluegum.

'In that case,' said Bill, 'let her go for a song.'

Frank wrote on Mar 29^th, 2024 at 2:48pm:


You have confused  the 'pudding' - a real (presumably desired) resource - with money which is a symbolic measurement of real value related to real resources (which can't be created out of thin air), the measurement symbol itself being created out of thin air (whether dollars, yen, pound, yuan or euros. etc) by the issuing government.

The government of course is tasked with managing the  mobilization of the nation's real resources, hopefully for the benefit of its citizens; lack of money is not a problem for currency-issuing governments - "magic"; the problem is successful resource management. 

So Phil Waller #864 is correct.

https://billmitchell.org/blog/?p=61659

Rinse and repeat – Truss chaos – the new benchmark

In her ‘Oral statement to Parliament’ on September 8, 2022 – PM Liz Truss’s opening speech on the energy policy debate – Truss outlined her ‘economic plan’ to reduce regulation, particularly in the energy sector to give “investors the confidence to back gas as part of our transition to net zero”.

In the subsequent ‘mini-budget’ delivered by the haphazard Chancellor Kwasi Kwarteng on September 23, 2022, they proposed a “real, Tory budget” (in the words of the Daily Mail, which would have delivered the largest tax cuts to the top end in 50 years (1972).

What happened next?

Well, the financial markets decided to make some money and sterling fell sharply against the US dollar and long-term government bond yields rose sharply, almost immediately after the mini-statement was delivered.

.....

On Tuesday (March, 26, 2024), the Financial Times published an article from its correspondent in Washington –

US faces Liz Truss-style market shock as debt soars, warns watchdog

– proving my point.

Over the last few months a veritable parade of financial market types (Larry Fink, Jamie Dimon, Mr Independent Central Bank boss, Jerome Powell, and others) have been predicting a total meltdown of the US government finances.

The latest article on this theme appeared today (March 28, 2024) – Larry Fink joins Jamie Dimon and Jerome Powell is sounding the alarm on ‘snowballing’ national debt: ‘The situation is more urgent than I can ever remember’.

America has “snowballing debt” and is:

…

"on course to end up in a crisis reminiscent of Japan’s lost decade, and Washington cannot take for granted the notion that investors will continue to fund its fiscal deficit forever."

Let me state here and now – that prediction will never come to fruition even if you believe that the financial markets actually ‘fund’ the net spending of the US government, which is itself a falsehood.

The mainstream dies hard....