How Does a Sovereign Currency Work? (Presentation) And Welcome to OWS Year 2 (Upcoming Call-in)
Sorry for the relative silence here at GLF–I’ve been traveling. This past Tuesday I gave a presentation at Columbia University, which is running a great series of talks, many of them presenting the Modern Money approach. These talks are streamed and eventually videos of the talks will be posted. You can sign-up for free! (Sorry I did not notify you of my appearance–I was abroad and not fully in the loop.) Go here: http://www.modernmoneyandpublicpurpose.com/resources.html
My powerpoint slides are posted below.
One more heads up, this one in advance! As you probably know, we are approaching the first anniversary of the Occupy Wall Street movement. To kick-off OWS Year 2, I’ll be joining a bunch of presenters on a “call-in” to assess where we are and where we’re going. Go here for a press release and list of presenters: ows2.org. I’m told that this site will be continually updated. I’ll talk about the causes of the Global Financial Crisis, the nature of the crisis, and how the government bailed out Wall St crooks, recreating the conditions that will lead to another crisis.
10 Responses to “How Does a Sovereign Currency Work? (Presentation) And Welcome to OWS Year 2 (Upcoming Call-in)”
I enjoyed the seminar, Randy.
Also, that was a nice commendation of John Ranlett's work a few weeks ago. He was a fine monetary economist (1928-2012). One can certainly say that your work builds upon solid ground.
Thanks. Yes John Ranlett was a good economist and a great teacher. While he was a lot more orthodox than me (and boy did he love to run through the ISLM model, over and over and over again) he sure did understand balance sheets. He was the first one to teach me that budget deficits increase bank reserves, by identity. And he had quite an arm, even as an old guy. He's the only prof I ever saw who actually threw chalk at 90 mph near the ears of students who proferred incorrect answers. No one ever dared to doze in his class–which he loved to run for 4 hours into the wee hours of the night.
You say "NEVER" a lot, but the fact is that congress by not increasing the debt ceiling could create a default situation. If you use NEVER, it should mean NEVER. You loose credibility when people figure these things out on their own.
I think Cullen Roche does a much better job with his operational descriptions.
As much as I credit Mosler and yourself for opening my eye's to some great new insights, I get frustrated by these incorrect descriptions.
Look at slides 23 and 24. Wray clearly lists debt limit as a constraint. And then notes that in that case it's up to fed (to make secondary market and guarantee dealer financing in repos). Like your friend you dont read carefully and then make up arguments about what we've "missed.". Not that we haven't said that for a long time already and you. Conveniently missed that too. Warren said the ratings agencies should downgrade US on desire to pay debt service back before last debt ceiling showdown.
Roche isn't the brains behind their work. JKH is. He understands all of this infinitely better than any MMTer does.
So he's contradicting himself then. If he doesn't mean that the government can "never" run out of dollars then he shouldn't say "the government can NEVER run out of dollars". Obviously, the government can choose to run out of dollars for whatever reason. Russia did it.
Choosing not to pay and being unable to pay are different things
___, debt ceiling is not the government running out of dollars, it is the government CHOOSING not to spend. MMT ain't hard…
FidoPhil, please try to pay attention. Govt can CHOOSE not to make a payment. It might CHOOSE not to credit your bank acct with your SocSec payment this month. Maybe govt thinks you are a fraud. Maybe Congress misunderstands budgeting. Or any other number of reasons. But if govt does so it is NOT because it 'RAN OUT OF' keystrokes.
Government can do anything what they wanna do. They have the power and they hold everything.