Nerd Farmer Podcast has the episode Getting to Know Modern Monetary Theory (MMT): Nerd Farmer Academy — Dr. Fadhel Kaboub, Denison University — #136.

Today’s #NerdFarmerAcademy episode is a conversation with economist Dr. Fadhel Kaboub, Associate Professor of economics at Denison University and President of the Global Institute for Sustainable Prosperity. He is a noted expert in Modern Monetary Theory, heretofore MMT. MMT is an economic theory that posits our approach to debts and deficits is just wrong. MMT economists believe that the concerns frequently expressed about the US debt are basically economic concern-trolling. They note that because the US government, unlike you and I, is a currency issuer, rather than a currency user, the limits on government debt are much higher than most of us have been led to believe. They call on the government to use debt to do great things. MMT-ers believe we can afford a much more generous government that can make a meaningful difference in the lives of working people.

Fadhel Kaboub gives you the most painless introduction to MMT that you will ever hear. In less than an hour he tells you all the fundamentals you need to know and explains why you need to know them.

Fadhel Kaboub might be just a tad harsh in his judgment of Paul Samuelson. Over 50 years ago, I took my first college level economics course. It used Paul Samuelson’s book Fifth edition 1961. Somewhere I learned of the teachings of John Maynard Keynes. I presume it was from Paul Samuelson’s book. There are 7 entries on Keynes in the index of Samuelson’s book.

From what I have read since then, later additions of Samuelson’s book may have de-emphasized Keynes. Fortunately, I was out of college and didn’t get tainted by those later editions.

Live Science has the article What’s happening inside Simone Biles’ brain when the ‘twisties’ set in?

A complex system in the brain that keeps gymnasts balanced can get out of whack.

I had a chance to experience this when I was learning SCUBA diving. I was doing somersaults in the water when I suddenly lost the ability to feel which way was up. I had to stop all motion to recover. If I hadn’t been wearing SCUBA gear, I might have run out of breath before my senses recovered. I never did somersaults in the water again.

This article is something we non-athletes need to understand before we criticize athletes. Max Blumenthal’s recent remarks about Simone Biles are so reprehensible, that I may not be able to listen to him ever again. It’s like I have the twisties about Max Blumnenthal.

YouTube has the video Marianne Williamson: Capitalism Is Killing Us | The Jacobin Show.

Author and activist Marianne Williamson joins Jacobin to discuss the Democratic Party’s rot, her presidential run, and why capitalism makes us all so miserable. Matt Bruenig of the People’s Policy Project also joins us to discuss the benefits of monthly checks from the government

The headline and title are way too narrow to explain the depth and breadth of this show.

Marianne Williamson comes on in the last hour of the show. It is a great interview with her. There were also three segments before Williamson’s appearance that were very enlightening and enjoyable.

The Institute for New Economic Thinking has the podcast (and transcript) Myths and Landmarks in US Economic History

Economic historian and INET board member Richard Vague, talks about his latest book, The Illustrated Business History of the United States, which reveals a number of misconceptions and myths about the development of the US economy

An early comment by Rob Johnson astonished me in how much he had missed the issue.
It’s not a question of whether or not the financial system should have been bailed out in 2008. The issue is what should have been bailed out. People mix up financial institutions with the executives that ran them (into the ground). We could have bailed out the institutions and jailed the executives.

YouTube has the video Warren Mosler on MMT, CBDC, bitcoin, bonds, interest rates, inflation, taxes and unemployment.

MMT founding father, Warren Mosler, explains Modern Monetary Theory (MMT). He says it’s about sequence. Governments don’t need to borrow or tax before they spend, if they issue their own currency. The economy needs the government money, not the other way around. Most politicians don’t understand how the monetary system works, also for example the way how banks create money.

As this interviewer shows, it is quite possible to talk to Warren Mosler and still not agree with nor understand what he is saying. The mind with preconceived notions is very hard to change. As this interviewer implies, “Yes, Warren Mosler, Modern Monetary (Money) Theory changes everything, but all the ideas I have had before knowing MMT still hold.” It is just so funny to hear it. I am sure I suffer from the same problem.

A wewsite that warren mentions is moslereconomics.com. Mosler also mentioned Money on the Left.

How & How Not to do Economics is an 2019 INET series of 11 lectures that are about 15 to 20 minutes in length each. I have made it through 4 so far. It is not a matter of agreeing or disagreeing as it is a matter of being exposed to a broader range of ideas. I studied or read about many of the historical figures mentioned here, but at the time I didn’t have enough context to really understand what I was reading. The more I hear lectures like this, the more I realize what I missed when studying these things over 50 years ago,

Interestingly, the various people I listen to who talk about the history of economics don’t always agree on the significance or lessons of the various historical figures that they discuss.

I think it was Taleb who said that you are on the firmest grounds when you just describe what happened, and on much more unstable grounds when you try to explain why things happened the way they did.

I have learned that even discussing what happened is fraught with interpretation. So describing why something happened must be on less firm ground if you can’t even agree on what happened.

Here is the fist lecture. See the link to INET above to get to all the lectures.

Bill Mitchell’s blog has the article The role of bank deposits in Modern Monetary Theory.

You can read this article and still be confused by the word play. I think this sentence in the conclusion settles it for me.

Deposits do not fund loans. But they are one source of funds that the bank has available to ensure that its role in the settlement process is not compromised which would require borrowing from the central bank.

I get a lot of pushback from people who have read about MMT when I try to make the above point. Mitchell’s article discusses the myriad ways that a bank can raise the money it needs. He discusses the different costs that a bank might incur by employing any of these methods. That discussion leads to the above concluding sentence mentioning two of the alternative methods.

YouTube has the video Global Capitalism: The Challenge of China [July 2021].

In this month’s lecture, Prof. Wolff will discuss the following:
1. China’s Economic Growth since its Revolution (1949)
2. China’s Economic “Model” and the Global Economy
3. China, Capitalism, and Socialism
4. China versus the US: Options versus Threats

A very good presentation by Richard Wolff. Lately I have been feeling that I have learned everything from him that I am going to learn from him, but this was an excellent presentation that rounds out everything that people think Richard Wolff has been pushing. It presents a picture of a better way we can interact with China than we seem to be heading in the last administration and the current one.

James K. Galbraith has published a very eye-opening article Dismal Economics. I was almost discouraged from signing up for a free subscription that allowed me to see a couple of articles a month on Project Syndicate. Here is the introduction.

Although neoclassical economics relies on assumptions that should have been discarded long ago, it remains the mainstream orthodoxy. Three recent books, and one older one, help to show why its staying power should be regarded as a scandal.

He then goes on to review 4 books. There are so many revelations in this article, that I cannot quote them all. One of the first ones I came to is:

It was this latter group that shifted the discipline’s focus from social classes (landlords, capitalists, workers) to individual units (households, firms) and declared that these units interacted to maximize not “surplus” but “utility” and efficiency. The marginalists also introduced a “sophisticated” mathematical technique to the field: namely, the differential calculus, with which one can show that maximum efficiency is reached when firms are small and competitive, as this tends to reduce profits to zero.

He then goes on to criticize some of what I have always considered to be bêtes noires of Economics, but even criticizes some of my idols. The critique of my idols has opened my eyes to things about them that I have missed noticing before.

I am going to have to decide which of these books to read first,

Mason Gaffney and Fred Harrison, The Corruption of Economics, Shepheard-Walwyn Publishers Ltd., 2006 (first published 1994).
Stephen A. Marglin, Raising Keynes: A Twenty-First-Century General Theory, Harvard University Press, 2021.
Alessandro Roncaglia, The Age of Fragmentation: A History of Contemporary Economic Thought, Cambridge University Press, 2019.
Robert Skidelsky, What’s Wrong with Economics?: A Primer for the Perplexed, Yale University Press, 2020.

The socialist programs pay for things that do not make money by themselves, but they build the infrastructure that the capitalism in our society needs to grow the economy. One benefit of socialism is that it provides what the economy needs despite the fact that no single private company can make a profit from these activities.

China’s economy is growing so fast not because they are cheating. It’s just that China is making the investments that the USA refuses to make. China is industrializing while the USA de-industrializes. What actually wise capitalist thinks that our de-insdustrialization is good for the society as a whole? They all know that it is the most profitable path for individual companies in the short term. In the long term, after all value has been sucked out of USA companies, there will only be a tiny, shrunken USA economy.

What the USA is doing has been likened to killing the goose that lays the golden eggs.

For anybody who thinks they read in the above paragraphs any support for the lack of democracy in China, the truth is that what you think you read is a fantasy of your own mind. Just because I support investing in infrastructure like China does, in no way means I support everything else that China does. Don’t let your hot head make you see things in my post that are not there.

I can actually tell the difference between what I like, and what I don’t like. I wish more people had that ability.