To start at the end of Positive Money’s latest article “It is promising that MMT (Modern Monetary Theory) is gaining traction in every corner. We greatly enjoyed attending both [MMT] events and have only warm expectations about working together to design a better, healthier, fairer economy.” “Positive Money (PoMo) has long advocated using public money… Read more
Category:
Money
The IMF have suddenly discovered both the price of everything and the value of nothing
The FT has reported that the IMF says that “Cash-strapped governments could find a huge new source of revenues if they managed their assets more professionally” Those presumably will be the ones that the IMF was previously in favour of not just managing, but privatising. “The potential receipts, equivalent to an average of 3 per… Read more
Boom in shadow banking is a stability problem
The FT is pointing out that the European Central Bank (ECB) is worried about the shadow banking boom (intermittent paywall) in Europe. Ten years after the world was rocked by an unprecedented banking crisis, policymakers are sounding the alarm about the spread of risk out of the now more regulated banks and into the “shadows”… Read more
Weimar and discovering the case against austerity
Having recently been criticised by someone who considers that the history of the Weimar Republic means that the government can never print money, and that governments should more properly follow the advice of sober bankers, I countered that the Reichstag was actually private at the time so it was not the government printing the money… Read more
Bankrupt Legislation
An interesting programme last night on Radio 4 about bankruptcy – something to which I have been close for about 5 years or so of my life. What disaster befell me? Just a corrupt solicitor, who unfortunately deceived me. He went to jail in due course – and I doubt he enjoyed it as he… Read more
Positive Money edges towards Modern Monetary Theory
A recent article by Positive Money seems to indicate that they are gradually edging towards a view of money that takes on board Modern Monetary Theory (MMT). They quote with approval, the Bank of England: “Saving does not finance investment, financing does.” and then continue: Here lies the real overlap between the MMT and Positive… Read more
Further news from HM Treasury
Following my previous correspondence with the Treasury I had to ask why it seemed to be fine for private banks to create money by issuing loans at will, yet if the Treasury were to create any money it would be inflationary. Here is the reply (as ever, click to enlarge): The key response to my… Read more
A new role for the Bank of England?
I was interested to discover that Marshall Auerback of the American think tank the Levy Institute, has recently written an article in which he suggests that Central Banks are in effect really insurers to private banks. And all by way of Walter Bagehot, who I discover was not just an authority on the UK Constitution,… Read more
Despair of ‘The Left’
Grace Blakeley, of the IPPR, has written a tour de force on the financialisation of capitalism on the Jacobin website and bemoans, as do most of us, the lack of proper change since the financial crisis. She sums up the pre 2008 situation rather neatly, I thought: This class of [middle class] “mini-capitalists” had a… Read more
Having to use two words where one should do…
I lived dangerously and mentioned to someone the picture I posted yesterday on revenue. Notwithstanding that the root of the word ‘revenue’ certainly means to come back, and so in theory neatly proves that governments spend first and tax later, the danger is, as I discovered, that everyone presumes that revenue is its own justification…. Read more