The Magic Money Tree. a Poem by Roger G Lewis #MagicMoneyTree
A Creature of Cryptography
The Computer Has to say yes
So Banks can issue Debt You see.
Adjusting the rate of Usury
Government Borrowing and Private debt
Add up to the money that you get
Commodity, Chartalist or Credit Theory
In Truth all Theories of the Merkel tree?
Are Based upon a Tautology, That´s MMT.
The Simple rhyme that you can sing is
and MMT say that you have to judge Government spending by its impact
on outcomes like employment, productivity, and price stability, and
that fiscal responsibility means getting good results in these areas,
whatever the debt numbers show. To
suggest that "high deficits," national debts, and
debt-to-GDP ratios over 90% are bad for a national economy is a
theory, and it is one that is not supported by empirical data. MMT is
saying don't do austerity based on a theory that is constantly
refuted in the real world, but
do use Government spending to try to end this recession, and watch
the outcomes. If we see inflation, then that's the time to do
austerity; but until we do we have no reason to back off our full
employment, productivity, and other public purposes.
Recollection of the famous passage in The Theory of Economic Development
(Schumpeter, 1934,p. 74) should suffice:The banker […] is not so much primarily a middleman in the commodity ‘purchasing power’ as a producer of this commodity […] He stands between those who wishto form new combinations and the possessors ofproductive means. He is essentially a phenomenon of development, though only when no central authority directs the social process. He makes possible the carrying out of new combinations, authorizes people, in thename of society as it were, to form them. He is the ephor of the exchange economy. In other words – as Schumpeter wrote in his ambitious and unlucky
Business Cycles credit creation is the monetary complement of innovation
(Schumpeter, 1964, p. 110):