The Wealth of a Nation is Not Measured in Money, but in Productive Output

When a nation has a sovereign currency, measuring national wealth in dollars makes no sense. Money is created (and destroyed) by the banking system (which in the US includes the US Treasury and the Federal Reserve Bank) as needed. When we ask things like "How are we going to pay for it"?, we're misleading ourselves. … Continue reading The Wealth of a Nation is Not Measured in Money, but in Productive Output

Understanding How Modern Money Works, Requires Knowing Reserve Accounting

Someone shared the tweet thread below with me on either Facebook or Twitter (can't remember) and it's EXCELLENT. So I've recreated it here, as faithfully as possible to the original as I can. I learned stuff and I hope you do too. To see the original tweet thread, click here. Tweet Thread About Reserve Accounting … Continue reading Understanding How Modern Money Works, Requires Knowing Reserve Accounting

Cowboy Economist Tells Us How the Government Finances Its Deficits

We are not borrowing money from China...... What the Government is doing is creating its own financing to activate idle resources. Just like the private sector does.The Cowboy Economist (aka John Harvey Ph.D.) In this video lesson, the Cowboy Economist explains how the federal government finances its deficits. But before you watch this, you really … Continue reading Cowboy Economist Tells Us How the Government Finances Its Deficits

Cowboy Economist Tells Us How the Private Sector Finances Its Deficits

Did you know commercial banks create money out of thin air every time they loan money? You may have thought that when you take out a $30,000 car loan, the banks takes $30,000 from their vault, and loan you other people's savings. This is not the case. They literally create $30,000 out of thin air, … Continue reading Cowboy Economist Tells Us How the Private Sector Finances Its Deficits

Cowboy Economist Tells Us How to Recognize a Socialist

The Cowboy Economist is John Harvey, PhD, who has started making really funny educational videos about econonmics. They're worth sharing, so I am. John draws a distinction between big S socialism (Karl Marx) and small S socialism (Bernie Sanders) in a way that clearly distinguishes them. The two definitions are below. As he says, they're … Continue reading Cowboy Economist Tells Us How to Recognize a Socialist

Is Economic Rent (Adam Smith) and Fictitious Capital (Karl Marx) the Same Thing?

This is really a question or inquiry from me. I'm not an economist. Both of these terms are new to me. Adam Smith spoke about Economic Rent. Rent-seeking is an individual's or entity's use of company, organizational or individual resources to obtain economic gain without reciprocating any benefits to society through wealth creation. As defined … Continue reading Is Economic Rent (Adam Smith) and Fictitious Capital (Karl Marx) the Same Thing?

Warren Mosler Interviewed about Modern Monetary Theory (MMT)

I listened to an interview of Warren Mosler by Bob Murphy, for episode 18 of The Bob Murphy Show podcast. A link to the full interview is at the bottom of the post. The interview is easily divided into three sections, which can be listened to independently if desired, so I broke the interview audio … Continue reading Warren Mosler Interviewed about Modern Monetary Theory (MMT)