Відео

Taxes would get money out of the economy if every tax dollar is immediately cancelled and never spent by the government. But we know that this is not what happens. The government taxes, then spends the taxes _and_ creates new fiat currency because they want deficits an taxes are never enough in the deficit budget (by definition). So taxes reallocate wealth an new currency is perpetually injected. So much for "taxes take money out of the economy".

Great content 💯

the widgets illustration is grossly simplistic and not in any way realistic

What a load of gaslighting bullcrap

Focusing on USA case, here is what the vídeo ommits. The inflation is kept under control because of the colossal influx of imported goods that bolsters the supply side of the equation and allows Americans to have the average living standard much above what their productivity would permit. That is possible because they are not paying the public debt - the buyers of U.S. Treasury bonds are doing it. Everybody knows US will never repay that debt. In theory, they could by simply printing money. But it's value would get immediately eaten up by inflation since there is no tangible goods or production capacity backing it. So they will simply keep kicking the debt can down the road, getting more loans to pay the old ones. One may ask why the lenders accept participating in that immense Ponzi scheme. The answer is they don't have much choice. The Dollar is the currency that dominates the international trade, so there is little use for national reserves accumulated in different currency. And they know that if their turn they back to Dollar, all the international finance system would collapse, with tragic consequences for everyone. MMT is very, very dangerous theory for USA. It assumes the other countries will keep watching the wealth flowing from them to USA in ever-increasing amounts and do nothing about. They can not replace Dollar overnight, but they can gradually build alternatives. And that would be the death for the America as the first economic power in the world.

This is interesting, but really misses the big flaw in MMT. Governments don’t create money the way you seem to be describing. The primary way that money is created in an economy is primarily through lending and other financial market operations. Central banks play a big part in this, but your explanation (and seemingly the understanding of most MMT advocates) seems to suggest that governments just have a meeting and decide how much money to will into existence. MMT is taking the mechanism of inflationary pressure, against market capacity, and imagining that you can use this to supplant the modern banking system and public spending. It’s a deeply flawed libertarian fever dream.

"Prices on average are consistently falling." "Good for you in the short term" "$1,000 to $950 to $900.. you decide to wait" "Consumer Spending Falls" "Fewer Items being bought at lower prices, means company profits fall" "increase in unemployment rate means lower consumer spending, which puts a further downward pressure on prices" Terms like "viscous Circle", "Death Spiral", "Deflation is Dangerous" -- Does any of that actually sound bad to you guys? Falling prices, Good in short term.. lower prices are good in long term too because you get to keep more of your money! Consumer spending falls, so in reality you're practicing minimalism... is that so bad? Company profits are falling, who cares! unemployment rate ramps up, with prices going down you wont need nearly as much money to buy things as prices will continue to have downward pressure. Then you have all the fear mongering tactics; "viscous circle", "Death Spiral", "Deflation is dangerous" -- Deflation actually leads to; falling prices aka increasing purchasing power of money which allows consumers to buy more with the same income in-which effectively raises the standard of living. It drives businesses to become more efficient and innovative to remain competitive and profitable, deflation REWARDS SAVERS as the real value of savings grows over time. For economies with excessive debt, deflation can also discipline spending and borrowing habits, creating a more sustainable financial system in the long run. While deflation in the short term will actually hurt as markets correct, deflation can help realign markets to focus on value, efficiency, and long-term sustainability which would ultimately benefit consumers and businesses who are prepared to adapt.

At the beginning, wrong metaphor, the world IS FLAT, not a globe. NASA faked the moon landings.. etc.

I’m tired of hearing idiots complain about the government printing money. That’s what the government does. It’s what it’s supposed to do. Do you complain that Parker Bros printed the Monopoly money? Or if the Monopoly bank ran dry and you could, as the banker, get some more to keep the game going, would that be in any way wrong?

MMT is interesting and compelling. But we need to be careful that we’re not just believing parts of it because we want them to be true. Also, there could come a tipping point where the dollar isn’t the world’s reserve currency, in high demand and the default for commerce. We’re not close to that today. But the British Pound was once there. When the world stops demanding your currency, whether you have control over it or not, then you start to build debt in other currencies and that debt can’t be printed away.

Every single explanation of MMT starts with an 1.observation, then makes a 2. logical step, then makes a nonsensical conclusion from 1 and 2. In the above case a) there is inflation regardless of utitlisation because demand had been artifically raised and output does not instantly rise to meet demand and b) there is caused in effeciency because thw reason for the sub optimal employment is not adressed. What in effect they have described is subsides....and those aren't good things from an economic point of view.

I keep coming back in my mind to the Weimar Republic and hyperinflation. I imagine the Deutsch Mark was considered a pretty sound currency at that time before it all went horribly wrong. The Weimar govt needed to repay the massive Versailles debt so printed too much money and the rest is history… but is it that simple? It must have hade enormous unused potential for steel making and manufacturing after WWI and this was clearly underused afterwards. It had loads of slack in its economy but can you ramp up manufacturing heavy goods like guns, tanks and ammunition again? Presumably not until you’ve found the new steel consumption for the average consumer called private cars. What might have saved the Weimar Republic from its hyperinflation was another nice little war to create massive demand for those now-underused steel producers and manufacturers! If this idea is remotely correct, introducing MMT to modern politics might be incredibly risky even though it sounds so beguiling.

just a friendly reminder if you ask your viewers to like&subscribe for 3 times in a 10min video, they might find it repelling, one is enough

"theory"

This is an ass-backward nonsense video by someone who never attended an actual macroeconomics class. The video conveniently omitting the reason people track the size of national debt and the cost of carrying this debt.

The government does not "create" money. It borrows it by selling debt instruments. This is the grift of MMT. Why any university would respect this nonsense is beyond me. Probably, it is because it tells politicians exactly what they want to hear. Therefore, federal funding of universities is guaranteed!

If it is so magical why is inflation so high

Old badly discredited Keynesian bullsh!t

crazy

You could also add the super tanks button in order to get some support that way

To say that taxes do not pay government expenses because the government can print money is a technicality and a fantasy. If they do not tax, the money supply will keep increasing, leading to inflation. Therefore, the government needs to tax to spend without the consequence of an indirect tax, which is inflation.

I couldn’t finish the video. “Taxing takes money out of the economy”? Taxes still get spent. Just by the government. And government expenditures are part of the economy.

Inflation is the result of interest tacked onto loan payments.

Money perfects the ponzi scheme to steal your time and energy.

you didn't expand on this term 'capacity' , liar

well if mmt works why is the global economy crashing. also Japanese are poor and enslaved

Modern Monetary Theory the very recent theory of Economics that has been thrown out the roof by the politicians across the world time and again.

MMT is fantasy 🦄🦄

Fiat currency is axiomatically coercive as the monopoly money issued by government. Inflation is caused by a fall in demand and/or increase in supply of money. 'Spending' is an ambiguous idea - it can mean a spontaneous increase in the supply of money, increased velocity of money (fall in demand for money), consumption or capital expenditure - take your pick. Money is not 'injected' or 'withdrawn' from the economy with government spending or taxation - but real resources are diverted (misallocated) into alternative uses decided politically rather than economically. Inflation is more a symptom of fraudulent money and therefore failure in economic calculation in resource allocation than a symptom of money mismanagement at full employment (another ambiguous idea). In conclusion - MMT destroys market efficiency and makes unemployment (and therefore MMT prescriptions) more likely. A fraudulent accounting theory for coercive, fraudulent fiat money.

MMT requires CBDC, fiat slave currency on steroids.

What has been said applies to a closed economy, but what happens in an open economy? If there is not sufficient capacity you may import and since the dollar is the international means of exchange you can flood the world with dollars and no inflation will happen in as much as there is spare capacity abroad and this is what probably happened prior to covid which blocked China. In that period quantitive easing happened at enormous rates without inflation. Only when China blocked itself inflation started together with the Ucraine war etc that added a cost push inflation. All this for the USA and the dollar. But for a different country without the dollar this doesn't happen and the mmt doesn't work in an open economy

I’m so confused. One economics source says mmt is real. Others say it’s not.

You can always tell when 'experts' should not be listened to - they do not give any examples. They explain it all convincingly, but are subtly hiding a whole set of assumptions in their words.

not in my maths lessons ...

why not simply say that inflation is what happens when the amount of money not taxed back out of the pool causes its overall value to decrease? your‘scenario 2’ simply posits that the price goes up and that’s inflation, without explaining the mechanism how

Ok, so why do we constantly hear that the government is " borrowing " too much money and they are always borrowing it from " a market ". Infact who are these markets and why do they have to borrow from them with interest?

If the company can make 1 million widgets a year why isn't it doing it anyway? If there isn't a demand for that many why is the government buying them?

Fiat currency is based on belief which religions show creates wars and disruption. Gold based currency being universal based, helps stability hence the brics idea.

get straight to it. stop pontificatig and trying to be funny pls. have a good day

It seems that not only God works miracles by multiplying the loaves and fishes, but also the governments. Can this be true? No, it's a trap. It's a machine! See the book <<Are we Puppets of Energy?>>

When I immigrated to New Zealand 40 years ago, its population was about 3 million. Now its about 5 billion. Overall we have a better standard of living now than back then. If the Government had not increased the total amount of currency available since then, most of us would be starving and nobody would be immigrating here. Most of us would probably migrated to Australia, maybe even in boats, before now. I'm so appreciative of the Government having kept increasing the money supply to match the productive value of NZ's population and its natural resources. Unfortunately, NZ governments did not know anything about MMT, so the country is now paying annually about $8NZ billion as interest to overseas commercial banks. Unfortunately, the current NZ government continues to be ignorant of MMT. The USA governments have known about MMT for some time. They increase the availability of US dollars by what they euphemistically call 'quantitative easing'. Unfortunately, they then use that increased supply of dollars by spending it on more weapons, more munitions, and a larger military (but that's politics, not MMT, nor economics).

Minute 10.26 . . . WRONG TERMINOLOGY!!! New Zealand is currently in dire economic difficulties because the current authoritarian Government is striving to achieve a 'balanced budget' (aka like a 'balanced household budget') while there is insufficient currency available to allow the increase of supply to balance existing demand, which is causing unemployment and increasing inflation with its increase in prices (which is not gouging, just businesses trying to survive). The Government has already fired over 5000 government employees. Infrastructure projects started by the previous Government which were already in construction and already partly built have been cancelled, causing more unemployment. Please DO NOT use the word 'budget' in that illustration (I can imagine NZ's authoritarian Prime Minister saying "You see . . . I'M RIGHT!!!" Otherwise, I think your video is a clear and instructive explanation of MMT. Thank you!

A good explanation, and I learnt a few things about MMT, but it doesn't mention the role of government bonds/gilts which act as fixed-term savings accounts and have a similar effect as taxes in taking money out of the economy to balance spending. Commonly this is referred to as "Government borrowing" but I think that is misleading as it, again, conjures thoughts of a household budget managing its debt.

Maybe all we have to do is recognise the real problem it not rocket science

There's nothing modern about money printing. It's just been given a marketing and PR team.

Really helped alot

GREAT VIDEO.

Fiat money always existed, in times past commercial transactions relied on 'my word is by bond' for the delivery of payment for goods or services, they were conducted on the basis of a promise which could be sealed with a handshake, or a paper bill redeemable at the point of delivery. A restricted community conducted business on the basis of a promise and a piece of paper which was redeemable for specie. Most other transactions were conducted with very low value tokens [coins], they were generally accepted in payment as long as they retained their value in the eyes of the general public. In England [and later the UK] large value BoE paper notes [a promise to pay specie - gold coin] were introduced and accepted in payment for goods and services, they could be used to settle several transactions over extended periods of time because of each transactors faith in BoE to exchange the note for specie. That faith assured the BoE notes of currency in the commercial community. Deals could be settled in paper or specie. The issue of an inordinate number of bills led to the BoE flirting with disaster [the government saved it since many MP's were invested in it]. After over a century of a 'Boom and Bust' economy engendered by excessive note issue the government tried to control bank lending with the Bank Charter Act 1844 which allowed the BoE [a private bank (a misnomer, really the Bank of London)] to issue £14 billion in BoE notes against specie or government debt. The Act did not control the creation of bank credit [a money substitute] by the BoE and commercial banks [which created their own bank notes outside the control of government]. The restraint of note issue by gold reserves was now shown to be a delusion [long before President Nixon went off a long-standing non-existent 'Gold Standard'] in both the quasi-public sphere [the BoE] and the private sphere [the commercial banks]; the BoE operated an issue department that could ostensibly only issue £14 billion in notes backed by government debt. Debt could back the notes, not gold. This was exposed in 1914 when the BoE gold reserves were insufficient to cover the governments demand for notes to pay contractors for supplying war materials, the government resorted to printing its own money, 'Bradbury Pounds' in order to settle its liabilities. It really did not need the BoE to settle its domestic liabilities [foreign ones were another matter]. War bond sales and taxation kept domestic inflation in check. A form of MMT was successfully used to prosecute WWI without employing private bank credit [BoE or otherwise] the last debt-free Bradbury Pounds were withdrawn from circulation in 1927/8 [in the BoE note crisis of 1696 the government had also resorted to issuing its own debt-free notes]. Inflation can be caused by the private sector, or governments, usually by the a combination of both since national treasuries are staffed by, and dominated by, former senior executives of global banks [or 'wanna-be' executives of global banks]. The private banking systems stranglehold on government economic policy was highlighted by Sir Basil Blackett, a C20th Director of the BoE, "When it is remembered that kings and governments have throughout the ages insisted with jealous care on their prerogative of issuing money and controlling currency within their jurisdiction it is somewhat strange to find ‘modern’ States accepting as axiomatic a limitation of their sovereignty in the sphere of money, so far-reaching in its effects on their own powers and on the daily lives of the citizens as is involved in their agreeing to conform in all circumstances to a standard of value over which they have no control". As MMT maintains, in this digital age governments create money out of nothing, and they licence private banks to create substitute money [bank credit] out of nothing. Sovereign governments can always create their own currency however banks cannot [although there are cases on record - slapped hands all round from the 'regulators'] when trust in their solvency evaporates their credit rating disappears and since our system is dominated by private financial institutions the only entity capable rescuing them is the government! Sir Mervyn King when still Governor of the BoE observed, “.....it is hard to see why institutions whose failure cannot be contemplated should be in the private sector in the first place”. The Bradbury Pound [debt- free money created by the government] is an object lesson in the viability of MMT, the government has a national bank [The National Savings and Investment Bank, NS&I bank] through which it could channel its own debt-free [for the government] money, use bonds [government debt] and taxation to control inflation by targeting those areas of the economy responsible for inflationary pressure [usually it has been excessive private bank credit for those with assets on which to leverage loans for consumption rather than business or infrastructure investment]. State taxation DESTROYS money in the digital age, except when it is directed to a specific purpose, for instance if road tax was directly paid into a Highways Agency bank account, or the various local taxes go directly into a LA account. Community tax and Road tax actually end up in a centralised consolidated account and civil servants determine how much will be allocated to particular areas of expenditure, which bear no relation to the nomenclature of the tax, That is determined by the approved budget long before any tax has actually been netted against expenditure to give a surplus or deficit. The government creates its money out of nothing and uses taxes and bonds as accounting tools. Tax has to destroy money because the government cannot micromanage the economy, it tries to control the stock of money in the economy - which is very difficult with a dominant private financial sector, which it licenses to create substitute money [bank credit], refer back to Sir Basil Blackett and Sir Mervyn Rees. Banks destroy money when they net out their respective loans - where their customers creditor belongs to another bank. The myth that State taxation actually pays for anything is a left-over from an age where physical tokens were exchanged - once paper and then the electron were adopted that myth should have become as dead as the Dodo. Taxes remove spending power, along with bonds they are useful accounting tools.

I was looking for an explanation of MMT and very happy I found this video, good storytelling, clear explanation. Thank you

Unlike a debate on whether the moon is made of cheese, MMT because it is "believed" by those in power, it effects the real world and in this case the destruction of the western financial system. I can believe the moon is made of cheese, but it is another thing to harness all the resources of the country to build the infrastructure to go harvest the moon cheese.