SteveG’s Posts

MMT Insights on Different Amounts of Currency Sovereignty   Recently updated !

YouTube has the video “MMT Insights for the Ukrainian Economy,” Speech for the Ukrainian Society of Financial Analysts by Fadhel Kaboub.

In this presentation, I introduce the basics of Modern Monetary Theory (MMT) and highlight some red flags for the Ukrainian economy with regards to inflation, exchange rate stability, food prices, real estate speculation, and external debt.

Watch the video to see how Kaboub comes to these conclusions.

This is a video that the USA and the EU would rather the Ukraine not hear. When the USA overthrew the elected regime and installed one favorable to the west, they gave the Ukraine an economic deal that is the antithesis of what Kaboub would recommend. I bet the first question being asked is motivated by the debts owed to the IMF and the EU. This deal was intended to limit The Ukraine’s monetary sovereignty. This facilitated the ability of the western powers to strip the assets from The Ukraine.

If you can make it through the Q & A part of this video, Prof. Kaboub makes the above point, but perhaps too diplomatically. Since I have no need for diplomacy, I can come right out and explain that this trap for The Ukraine was purposely set by the USA and the EU. The current build up of hostilities between Russia and The Ukraine may be motivated by the West’s need to distract The Ukraine from understanding the damage we in the West are doing to them.

I realize that this presentation is the answer to my complaint about how the leading lights of MMT discuss inflation. I have often heard them bat down complaints of inflation, by saying “See, inflation is not a problem now.” I complain that is not enough of an answer. You have to look at why inflation has not been a problem and what could change to make it a problem in the future. Prof. Kaboub’s response “Look for the actual sources of inflation in the real economy” is exactly the answer I would like to hear from the other proponents of MMT.

African Monetary Sovereignty

YouTube has the video “African Monetary Sovereignty.” Keynote speech: Association of Panafrican Journalists (April 2021)

A brief introduction to the structural economic problems facing Africa and an outline of key policy insights from Modern Monetary Theory (MMT) that will ensure higher degrees of economic and monetary sovereignty.

Event hosted by the Association of Panafrican Journalists (Yaoundé, Cameroon).

There is a lot of great information packed into only 15 minutes.

America’s Neoliberal Financialization Policy vs. China’s Industrial Socialism

CounterPunch as the article America’s Neoliberal Financialization Policy vs. China’s Industrial Socialism by Michael Hudson.

The problem was not Russia, whose Communist nomenklatura let their country be ruled by a Western-oriented kleptocracy, but China. The U.S.-China confrontation is not simply a national rivalry, but a conflict of economic and social systems. The reason why today’s world is being plunged into an economic and near-military Cold War 2.0 is to be found in the prospect of socialist control of what Western economies since classical antiquity have treated as privately owned rent-yielding assets: money and banking (along with the rules governing debt and foreclosure), land and natural resources, and infrastructure monopolies.

U.S consumer prices surge in March

Market Watch as the article U.S consumer prices surge in March, CPI finds, pushing inflation to 2 1/2-year high.

The rate of inflation over the past year shot up to 2.6% from 1.7% in the prior month, marking the highest level since the fall of 2018.

Inflation is officially only at 2.6% (the Fed has been trying to reach 2% for years). However, I have been warning my fellow MMT proponents not to say that there has been no inflation, so inflation is not a problem. I have been suggesting that MMT proponents ask themselves, “Why has there been no Consumer Price Index inflation? What in the economic environment could change that would cause inflation?”

There has not been Consumer Price Index inflation, but there has been stock market inflation because we have had massive monetary stimulus going to the oligarchs.

The change that is starting to come about is redirecting more stimulus to the people who need it most. If they now have money to spend, but the economy is hobbled by COVID-19 lock downs. (An example, I want to buy a whole house backup generator, but a lock down pause at he factory means they cannot deliver one to me until October).

Since the answers to my suggested questions are obvious with a moment’s thought by the economic experts, why haven’t there been plans put in place to handle these contingencies?
As I have been pondering these scenarios for over a year, I finally stopped procrastinating last April. I bought some GOLD ETF’s back on April 2, 2020 as a hedge against my predictions coming true. I hadn’t invested in gold since the 1970s before this.

Don’t Let McKinsey Anywhere NEAR Infrastructure Bill

The Hill has posted the YouTube video Matt Stoller’s DIRE WARNING: Don’t Let McKinsey Anywhere NEAR Infrastructure Bill.

Author, journalist and research director at The American Economic Liberties Project, Matt Stoller, discusses the Biden administration’s need to distance itself from McKinsey in order to pass the infrastructure bill.

What’s wrong with Pete Buttigieg getting his training from McKinsey? We already saw his big gaffe about “paying for” infrastructure by taxing the users. He forgets, and so do many citizens, that corporations provide their services to customers to make a profit, whereas governments are supposed to provide services to enhance the well being of the people of the country. Even many businesses recognize that providing infrastructure for their workers benefits the company. To promote the use of cost saving infrastructure, there is an advantage for the corporation to subsidize the use of these cost savers by the employees. Investing a little money here can result in bigger savings over there. Even McKinsey should understand this application of the principle applied to corporations.

On the other hand I bet I observed a policy at a company where I worked that must have come from a consultant. The management felt that they were spending too much money on printed forms. They decided that people were hoarding the forms. The solution was to cut back on the number of forms an employee could order. This edict caused the hoarding of blank forms so that they could be Xeroxed when you ran out. Surely the creation of forms by using a copier was far more expensive than having them printed with a printing press. The difference was that the cost of copying them was hidden from the consultants (and managers with MBAs).

Here is Matt Stoller’s article Keep McKinsey Away from Biden’s Infrastructure Push

Scott Ritter: US Empire in Decline, Biden Administration is Dangerous, Nuclear Specter Remains

Geopolitics & Empire has the interview Scott Ritter: US Empire in Decline, Biden Administration is Dangerous, Nuclear Specter Remains.

Former UN Weapons Inspector Scott Ritter discusses US foreign policy, the decline of US empire, and the shift toward a multipolar world. He considers the Biden administration to be one of the most dangerous in modern times as it has gone back to square one (the post-WWII era), demanding American allies and the world subordinate themselves to Washington. He looks at the rise of Iran, the failed Forever Wars in the Middle East which have destroyed the American economy and military, and considers NATO a joke of an organization no longer capable of fighting a war. The U.S is unable to catch up to China’s economic infrastructure investments and the consequences of continued hegemonic behavior and failed diplomacy could translate into escalation of military conflict with Russia or China and ultimately risk the use of nuclear weapons.

I think Scott Ritter is a little naive about our history during the cold war, but he has some very important perspectives to impart about the present and the future.

The trillion-dollar woman

The Ink has the interview The trillion-dollar woman.

If you want to find out what Modern Money Theory is, better to ask a person who knows. Here is an interview with Stephanie Kelton. (Her book is the one that I feature prominently on my Facebook page.)

MMT is about providing an accurate description of the monetary system that exists today and government finance mechanics. In other words, MMT describes how things work. We’re not on a gold standard anymore, but we haven’t come to terms with what that means.

We still have this idea that the federal government needs our money in order to pay its bills. That is wrong. Could Congress spend too much? Absolutely! But the punishment for overspending is inflation, not insolvency, contrary to what Ron Paul, Ted Cruz, and Lindsey Graham would have us believe.

At its core, MMT is about replacing the (flawed) concept of a government budget constraint with a natural resource (inflation) constraint. It’s not that there aren’t any limits. There are! But they’re not on the financing side (as we have been trained to believe). Our government cannot run “out of money,” as President Obama once falsely claimed. We cannot end up like Greece, and, contra these economists, we were never facing a fiscal crisis.

MMT teaches us to ask not, “How will you pay for it?” but “How will you resource it?” The politics are hard, but coming up with the money for Medicare for All, tuition-free college, or a huge infrastructure package is the easy part. Managing the use of our productive resources, and respecting our ecological constraints, is the defining challenge of our time.

Birth of a new geopolitical paradigm

The Alt World has the article Birth of a new geopolitical paradigm by Pepe Escobar.

Capping an extraordinary two weeks that turned 21st century geopolitics upside down, Iran and China finally signed their 25-year strategic deal this past Saturday in Tehran.

This is a point of view that has been missing from my reading before now. Having seen Pepe Escobar’s interview with Michael Hudson, I have realized he is someone worth paying attention to. See my previous post In Quest of a Multipolar Economic World Order

In Quest of a Multipolar Economic World Order

Michael Hudson has posted the article What Flavour Oligarchy?. It features a video and a transcript.

In this second round of conversation, Professor Michael Hudson and Pepe Escobar discuss the emerging economic world order which they define not so much as a conflict between nations, but a rivalry between two competing models of the economy. The finance capital driven model of the West with a domination of the FIRE sector, versus the mixed economy model represented by China and Russia which seeks to rein in rent seeking, combined with public banking and state funded infrastructure to support market compliant industrial development. In Professor Hudson’s view, this model was advocated by classical economists, from Mill, Ricardo, to Henry George; and is largely responsible for the West’s past successes.

This could be the best two hours you have watched in in a lifetime.

Alanna: So Michael, what about one city that it’s desperate that could be educated, that there is an alternative with clarity about a land value tax system and a public bank. For instance, the city of Baltimore that desperately needs a new economy. Can you give us some hope that we could focus on a city level and begin building a template for how cities and like Sao Paulo where Pepe is born, from the cities that desperately need change? Michael, can you give us some sort of template?
We know the federal government is hopeless for us now for we, the people. Texas is having a vote to form the Republic of Texas, to secede. There are other growing secessionist movements in the United States. Could we imagine that there could be an implosion away from centralized control to a regional and city level. Michael, give us some hope.

Michael Hudson: I can’t give you hope. I am all in favor of public banking and I’m on Ellen Brown’s board of directors for her group. However, supposing you had a public bank in Baltimore and the public bank said, we want to provide credit for Baltimore people to be able to afford homes. They would still have to out create enough credit and enough debt to outbid what commercial banks are lending other people that want to buy houses there. So, you can’t have an Island of efficiency and public banking in a system that basically is still financialized. The problem is systemic.