vandoren

I think that human stupidity is endless. Bonds are credit. What does it mean "created out of nothing"? If you ask me to lend you $100, and you give me an IOU - of course you create your IOU "out of nothing". All we need is an agreement between us. And if I have the money - then no money is created at this point. The reason why budget deficit permanently increases money supply - because governmental net borrowing is always positive, not because of money creation, which does not happen at this moment. PS Please read Marcia Stigum's "MoneyMarket" before posting even more nonsense.

Fascist = communist who understands the human nature a little better.

What it boils down to: Communism - kill he private sector! Fascism - enslave the private sector! Modern liberals - make the private sector a serf! Libertarianism - free the private sector!

What seigniorage would you'll have in the modern financial system? And, as I said before, you don't even need the FED - you can always borrow dollars in the eurodollar market. What many also do. As barn has written above - it's simply easier to use dollars.

I'm saying it's not important what you trade in. I agree with Dylan here.

As if you need US to get dollars. You can as well get dollars on the eurodollar market. And oil market isn't that big anyway. Dollar nominated oil market is ca. $400B/a. Throw in velocity of money and the demand is what, $100B? It's nothing. Especially if you sell your oil and quickly invest your dollars. Then the demand is stable. So, we are speaking about 100-150 billion dollars, much of which are eurodollar. Nothing to see here.

I won't, I have been self-employed, almost my entire life

I live here, you are wrong. At the time in question unions had not the power, and today they are just the usual socialist crap, concerned only with preservation of power.

Marshall plan has done little for Germany, it were just 1.5 billion dollar in loans - really not that much. The real cause was the free market currency reform of 1948 executed by Ludwig Erhard. Add high IQ, hard working population - and the miracle is yours. Just people! All equipment was stolen by Soviets - they still used it in the 1980s, I saw it myself. Make no sense to me.

What Tommy did last year was in no way different from what other media outlets did. For example here:

The first guy is annoying and stupid as hell. Apart of all stupid things he said, does he really think, that 4 years of income plus interest is less than income surplus from his stupid PhD? Unlikely. He's never calculated this, and he should have done standard cost-benefit analysis for both cases.

It wasn't inside the court, it was on the court stairs outside. The last year arrest was as unlawful as the current one.

Traceability is of course also a factor, but banks also lobby against cash because of profit.

It's much simpler actually. Cash is liability to the banks in the accounting sense.

I thought they want to abolish cash...

BTW, the whole Perry Mehrling course is on coursera - https://www.coursera.org/learn/money-banking My youtube link contains only small part of the course.

Don't you realize, that private sector can only borrow from the private sector, while the government can only borrow from the private sector? Your "net savings" (don't call it savings! it's simply loans to the government!) are a tautology. Why are you so lazy to learn how the money works? I've already provided you with resources. Government sells bonds. Bonds create money in the same way as private loans do - through expansion of balance sheets of private banks. Money in the modern economy - an introduction Money creation in the modern economy

There is no such thing as net saving. What Keynesians/MMTlers use as "net savings" is simply lending/borrowing diff of the private sector. Which has absolutely nothing to do with real savings. Of course if the government borrows money then it must come either from the rest of the world, or from the private sector. Only all this extra money can be used in every possible way - consumption, investments, savings. What you use as "net savings" has no meaning whatsoever. Here it is as used by the MMTlers: The real savings look completely different: Sorry, this is complete nonsense. If you take out a credit - you create new money. Uncle Sam isn't involved at all. Read the Bank of England papers. Listen to Perry Mehrling lections. Both are excellent.

That said, all this nonsense about equating national income to the GDP goes back all the way to J.M. Keynes, and was parroted without questioning in textbooks by such established "economists" as Mankiw and Krugman. I've never realized how bad all this is, because we learn the correct equation in Germany even in the undergrad courses. Which is this: Also the Statistische Bundesamt (German Federal Bureau of Statistics) does the GDP calculation in the correct way: https://www.destatis.de/DE/Publikationen/StatistischesJahrbuch/StatistischesJahrbuch2017.pdf?__blob=publicationFile Following the link, we can find all the needed data. For example the total national income was 2,388 billion euro, disposable income for households was 1,814B and saving of private households 181B. Private investments 194B. For the whole economy: disposable income 2,610B, savings 313B, investments 598B. The Keynes assumption that saving = investments is nowhere true. You may also go to BEA or to FRED and compute all this for the US, but the result should already be clear - Keynes was an idiot. As are the MMT adepts.

OMG, why is this a controversy at all? Why not look at a bank to see how it works? All money is someone's liability, that's all. Money is as real as debt. When someone takes out a loan - he expands the balance sheet of the bank, such creating money. The new money is backed by his ability to repay the debt. One could say that money is monetization of debt collateral. Read this to better understand how the banking system works (btw, Stefan repeatedly demonstrated a lacking understanding of this): https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2014/money-in-the-modern-economy-an-introduction.pdf https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2014/money-creation-in-the-modern-economy.pdf Speaking of MMT, the theory starts with two phony assumptions: 1) that money is created by the government. This is false given the explanation above. All money is simply an expansion of the balance sheets in the banking system. This is true on all levels - FED, commercial depositary institutions and so on. All players can create money through such expansion, and this is mostly done by the private sector. 2) the sectoral balances equation suggests that budget deficit is necessary for private saving. This is false, because they regard GPD in Y = C + I + T + (X - M) and national income Y = C + S + I as equal. However these two Y are different. GDP is not national income. (in the US GDP = $19,965B, National Income = $16,607B) National income plus depreciation plus indirect taxes are equal to GDP. Thus S = I is complete bullshit. Therefore, given that basic assumptions of MMT are false, there is no need to give MMT any attention. Period.

In a free market money is created when interest is payed back. Credit is nothing more than balance sheet expansion, when it is payed back - the expansion disappear. What is left behind is the interest. The interest is created by the borrower through his economic activity. So, we the people do create money. However, when government coerces central bank into zero interest rate, then the system is led to the point of absurdity. When money is free, then market instruments do not work. Why inflation didn't happen until now? Because inflation is equal change in money supply plus change in velocity of money minus product output. In the current situation increase in money supply is counterbalanced by lower velocity, which is simply weak market. Weak market was created because FED/GOV put market laws to rest.

If you mix East Asians and Europeans, then let evolution work in a harsh environment for several thousand years - then you'll get improvements, since both populations have different favorable alleles. If you mix with Africans - I doubt you will get enough good alleles, but much of genetic garbage. Without evolution, without enough time, without harsh enough environment you won't get significant improvements.