I have seen evidence that I am going to need the article Rothschild Family Wealth a lot in the coming days, months, and perhaps years. That’s is why I am finally posting it on my blog for easy finding.

While the Rothschild family has amassed great wealth since the 1700s, claims that they have a net worth of $500 trillion or that they own 80% of the world’s wealth are problematic.

For one, the world’s total wealth was estimated as of 2015 to be only $250 trillion, half of what the Rothschild’s alone are claimed to possess.

There are many interesting facts in this article which don’t depend on having faith in the messenger.

The closest thing to a “Rothschild Family” business in 2016 is the Rothschild Group, a multinational investment banking company, but that firm does not in itself generate nearly enough income to back up claims about the family’s wealth. In 2015, the Rothschild Group’s annual revenue was approximately $500 million. In comparison, the world’s largest company, Walmart, has an annual revenue of nearly $500 billion.

Райчо Марков posted the article HOW ARE YOU GOING TO PAY FOR IT?. This is a speech written by Warren Mosler.

Warren Mosler: “So how do you like this unsolicited speech I drafted for him (PRESIDENT BERNIE SANDERS – well apparently not anymore)”:

Early on, he wrote these words for Sanders to speak.

And before I begin, I’d like to thank my chief economist, Professor Stephanie Kelton, a specialist in economic policy as well as Federal Reserve Bank monetary operations, for educating me on this critical question.

Stephanie Kelton is a name you will see in several places in my blogs and posting, so I wanted you to know who she is.

Now, for a little tantalizing bit of meat from the “speech”.

The public debt is nothing more than all the dollars spent by the government
that haven’t yet been used to pay taxes.

And those dollars stay in the economy as someone’s savings until they get used to pay taxes.

Think of it this way – when the government spends a dollar, someone has to have it.

And if it also taxes away that dollar, that dollar is gone from the economy.

But if the government spends a dollar and doesn’t tax it away, it stays in the economy as someone’s savings.

And most all of that savings is right there at the Federal Reserve Bank in bank accounts that they call Treasury bonds, notes, and bills. Yes, all those Treasury’s are just dollars in savings accounts at the Federal Reserve Bank with fancy names.

I don’t care what you do and do not understand about economics, this explanation is so simple and obvious that I doubt many will fail to understand it.

Ellis Winningham has posted his article Don’t Listen to Milton Friedman. There is a Free Lunch If There is a Lunch to be Found on his web site.

Is lunch what you used as payment to buy lunch, or is lunch what you eat? I’ll ask again – do you eat US Dollars or do you eat the food purchased with US Dollars? You can be hungry at noon and have $60,000 burning a hole in your pocket, but if there is no food anywhere to be found, what good does that $60,000 do you as far as lunch goes? Lunch is the thing you consume, not the thing used to purchase the thing you consume. Food is a commodity, US Dollars, British Pounds are not. US Dollars are just a voucher used to obtain lunch.

The article goes on to explain what MMT is saying and what it is not saying in terms so simple that most people should be able to understand it easily. Understanding may be different from accepting. I am sure that some people will continue to think that they must have been tricked into something by this article. In the long run, I don’t believe these doubters will be able to find any tricks in the article, and more and more people will get to acceptance.

Once we get to acceptance by a large enough population, the oligarchs will have lost their grip on our minds. From that point forward, anything becomes possible.

Isn’t it obvious that if there is a supply side economics, there must be a demand side economics?

I take supply side economics to mean that when supply is not adequate to meet demand, you want to work on increasing supply harder than working on decreasing demand. I think that makes an awful lot of sense.

The proponents of a single prescription that works for all diseases fail to ask if there might be a different prescription for a different disease. If there is supply side economics to cure one disease, isn’t it natural to ask if there is demand side economics to act on a different disease?

I take demand side economics to mean that when demand is not adequate to meet supply, you want to work on increasing demand harder than working on decreasing supply. I think that makes an awful lot of sense.

It didn’t take much to come up with demand side economics. All I had to do was to swap the words demand and supply.

The problem with adherents of supply side economics is not that their is a flaw in the theory. The problem is not knowing when that theory applies, and not knowing the obvious theory to apply when the situation changes.

There is no contradiction in being a proponent of supply side emphasis when it is needed and demand side emphasis when it is needed.

To me, it seems so obvious that I don’t know why more people aren’t saying this, and why it has taken me so long to write this.

Back to the original purpose of this blog – education about money and economics – Critical Finance has the article Full Reserve Banking: The Wrong Cure for the Wrong Disease.

As J. K. Galbraith famously observed: ‘The process by which banks create money is so simple the mind is repelled. With something so important, a deeper mystery seems only decent.’

I’ll use this article as an excuse to put forward a related idea that I have had recently.

One of the limitations on Quantitative Easing (QE) is that the Fed only buys paper assets. This is the closest the Fed thinks it can get legally to fiscal policy maneuvers. However, this is like pushing on the proverbial string. They can put money back into the hands of the banks, but if there is nothing to invest in, then it just creates asset bubbles, and puts very few people back to work. If instead the Fed could buy infrastructure, they could put people to work, and this would be real fiscal policy.

Imagine if the new QE had the Fed buying state and local infrastructure bonds. The money would have to be used to build the infrastructure for which the states and localities issued the bonds. This would put people to work, replace the lost consumer demand in the economy, and get the economy moving again with a fairer distribution of wealth and income. It would eliminate the legislative and executive branches of the federal government from interfering with the growth of the economy.

What if states and localities were able to have reserve accounts at the Fed, so that they could borrow directly at the same interest rates as the banks do? My idea of the Fed buying state and local bonds is one step removed from the direct access. What would happen if we did away with the one step removal? The states would not have to issue bonds and the banks and other private financial institutions would not be raking off profits from running this bond trading system.

Yes, I am only talking about the good aspects of this change in policy. Of course there are some bad aspects that would have to be controlled. I am just not featuring that aspect in what I have written here. I fully admit that. You can nitpick away with all these other issues, but first, I would like you to examine the idea for its positive possibilities.

If you don’t like the idea of the Fed having control of part of the fiscal policy, there is the idea of creating an infrastructure bank to handle it. The trouble with that is that we would have two federal entities creating high-power money, and that would not be good. If the Infrastructure Bank could borrow from the Fed to fund its operations, then that might be a good way to handle it.

I have read many of Joe Firestone’s posts on New Economic Perspectives. This is the first time I have seen a live interview with him. It is especially good interview because the interviewer, Steven D. Grumbine, is very well versed in the topic at hand.

This is a heavy duty session on US money, US debt and deficits, US taxes, and economic policy help for the bottom 90%.

If there is one thing to learn it is that in the United States of America

Taxes Are Not Needed To and Do Not Fund Federal Government Spending..

This is a hard concept to believe, but you need to learn enough about it to understand why this is true, Any Progressive that gets into a debate with a Republican, a Conservative, a Neo-Liberal, or a Libertarian will surely lose the argument if you are arguing from their erroneous frame of reference. You have to be like Steven D, Grumbine and me who start screaming when any Progressive who doesn’t know the above concept and gets into an argument about how any government program will be paid for. It will be paid by the Federal Government creating the money to pay for it. That is how all Federal government spending is paid for. This only applies to Federal government spending.

In the video, there is an important discussion of sector balances. It might help to have the following picture in mind:

This comes from my previous post When Will the White House and OMB Ever Learn About Sector Financial Balances?

CNBC has the article and video Chinese billionaire Jack Ma says the US wasted trillions on warfare instead of investing in infrastructure.

“The world needs new leadership, but the new leadership is about working together,” Ma said. “As a business person, I want the world to share the prosperity together.”

he says ironically as he amasses billions for himself. Well, I suppose I have defeated my purpose by starting with that quote and the snide remark. Actually he had some excellent things to say in this short video.

Ma says blaming China for any economic issues in the U.S. is misguided. If America is looking to blame anyone, Ma said, it should blame itself.

“It’s not that other countries steal jobs from you guys,” Ma said. “It’s your strategy. Distribute the money and things in a proper way.”

It took me a few readings to understand what he was trying to say. It is our strategy that is causing us job loss, not the stealing of jobs by other countries. If we had distributed money and things in a proper way, we wouldn’t find ourselves in the fix that we are in.

YouTube has the video Stephanie Kelton Destroys Peter Schiff’s Economic Myths On Sam Seder Show.

This may be the most important interview you will ever see. Stephanie Kelton should run for President. If you are at all confused by economics, taxes, deficits, and all the rest, this is the clearest and the simplest explanation I have ever heard of this topic.

I am a big fan of MMT of which Stephanie Kelton is a major proponent. Nevertheless, she even clears up some questions about it that I had.

See my previous post Bill Black: Obama Loved Austerity and the New Democrats Remain Addicted to It for an appreciation of the harm that ignorance of economics causes for our country. Bill Black is a colleague of Stephanie Kelton.

Naked Capitalism has the article Finance and Growth: The Direction of Causality.

Our findings also have an implication for the presumption after the start of the Great Recession that resuming credit flows was essential for economic recovery. In the Eurozone, where the recovery has lagged, efforts to create a greater supply of credit have been an important policy focus. Recapitalisation of banks, in particular, has been seen as crucial to the recovery of both the banking system and the economy. But where in the past the financial sector served a primarily wealth-preserving function, and where substantial wealth has now been destroyed, pushing more credit in the hope that this will generate growth could be counterproductive. This attempt to push more credit into the economy would be particularly harmful if growth potential is low. The risk is that zombie banks will be propped up, and the costs of cleaning them up and closing them down will only increase over time.

True conclusions, but a slightly misdirected search for the cause.

It seems to me that the key variable is the transfer of wealth from the bottom tiers of wealth holders to the upper tiers. All this analysis of credit to gdp ratio, and advanced economies versus developing economies, and pre 1990 versus post 1990, all point to the the possibility that transfer of wealth is the issue. Measuring the growth of the financial sector as this article does, we see scatter plots with dots all over the place. That means that there are huge exceptions to the rules being gleaned. As an electrical engineer, I would call this a large noise to signal ratio. If we plotted all of the growth data against the axis of wealth disparity we would get smaller noise and larger signal. Then we could talk about large signal to noise ratios, and fewer and smaller exceptions to the rules.

Consortium News has published A Demand for Russian ‘Hacking’ Proof,

More than 20 U.S. intelligence, military and diplomatic veterans are calling on President Obama to release the evidence backing up allegations that Russia aided the Trump campaign – or admit that the proof is lacking.
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Alleged Russian interference has been labeled “an act of war” and Mr. Trump a “traitor.” But the “intelligence” served up to support those charges does not pass the smell test. Your press conference on Wednesday will give you a chance to respond more persuasively to NBC’s Peter Alexander’s challenge at the last one (on Dec. 16) “to show the proof [and], as they say, put your money where your mouth is and declassify some of the intelligence. …”

Obama doesn’t have to reveal sources and methods. All he has to do is respond to this non-clasified report by civilian computer security experts. as indicated in my previous post US Govt Data Shows “Russia” Used Outdated Ukrainian PHP Malware.