Sunday, 20 May 2018

#MMT Commissars and Thought Police.






JohnG January 21, 2016 at 2:03 pm # 

The whole of the intercourse between all of the actors in Civil Society can not be reduced to a balance sheet expressed only in Monetary terms,a governments and a states success can not be expressed as a mathematical function proving that all of the terms sum to zero.
It’s not hard to understand.
The government is on one side of the balance sheet and the non-government is on the other.
Pretty simple stuff that seems to elude ‘educated’ western people.
Makes you wonder whether western people are being misedumacated.
  • Roger January 21, 2016 at 2:47 pm # 
    Civil Society
    can not be expressed as a mathematical function proving that all of the terms sum to zero.
    Thus.
    In stock/flow terms (I – S) + (G – T) + (X – M) = 0.”
    where
    The private domestic balance (I — S) …
    The Budget Deficit (G — T) …
    The Current Account balance (X — M)
    Where in this balance sheet ( Function) or (Identity) do we find a Spirit Level component or a Gross national Happiness level? Balance sheets do often include an entry for Goodwill in the business which isn´t really the same thing and in any case society is not a business and other metrics are necessary.
    Confusing the description or depiction of a thing for the thing itself is a silly mistake in music as in art as in life politics and economics it is not so much what you see or play or put in as much as it is what you don’t see what you don’t play and what you leave out.
    The concepts of opportunity cost and Potential are missing from a reduction to a balance sheet.Where is the love in this technocratic MMT balance sheet?
    Guido perhaps gives a clue in the Italian governements. ” need to continually torture the GDP figure to the extent where in Italy and France for example, they now add the black economy (prostitution and drugs) in the calculation of GDP in order to maintain the veneer of growth thus investment rating.”
    • JohnG January 21, 2016 at 9:39 pm # 
      Where is the love in this technocratic MMT balance sheet?
      How much more ridiculous can you get?
      It’s a starting point. Understand it before you go on.
      One would have hoped that it may get you thinking about income as a flow.
      Instead you engage in more hand waving.
      • Roger January 22, 2016 at 8:55 am # 
        See Keens analysis below of MMT and Monetary Circuit Theory.
        I have been an avid student of Keens since around 2010 so in 6 years I have enjoyed the first use of Minsky when it became available and I have it on my computer tool bar. I am also a qualified Chartered Surveyor the branch I belong to is the Valuation branch My business I was in business seriously , was all about income flows John G.
        If you were interested enough to follow keens lecture, it is 20 minutes long you will see he gets into the mathmatics of the Mathmatical Identity you posted earlier, representing your sectoral balances approach.
        The Post Ante Nature of your summed flows is a weakness which I have explained due to the ill posed nature of a derivative that can experience large Changes as a result of small increases in inputs. This is a particular problem for Ex Post models like the Balance sheet identity represented by MMT theory in Sectoral balances.
        Moving form linear systems thinking to complex non linear systems is always necessary after demonstrating first principles with simplified proofs of concept. In reality all other things never remain equal or stationary and this is what will always vex the less than dedicated mathematical modeler
        Fast Fourier Transformation is actually a very good way of thinking of ´´The Love´´in the economy, The Love denoting the in expressable frustration that comes from Herding Cats or Commanding the seas to recede as the tide comes in. What FFT does is alows one to seperate out Time boud variable from frequency bound variabbles the frequecy bound variablesare the Cats, the tidesor the love if you will, they are in a sense random as thier actions arise out of infinite possible outcomes. This is the tradfe of in precision and prediction, over shorter time frames we have better odds or rather smaller potential errors in our prediction of frequency variable.
        Hopefully form this you will see what I meen By where is the Love? but also you will see very clearlyI feel the flow and realise that one has to a certain extent have to go with it.
        I get it all right but I aint down wid Dat. No Can Do.
        • Wesley - Complex and Dynamic! January 22, 2016 at 6:55 pm # 
          Quite right! This is precisely the effect that I attempted to convey in my Butterfly wings-tempest analogy… It’s also why the Socialists do not have an answer to the “calculation” problem mentioned in Spartacus’ 9 interview questions…
          [
          Wesley – from Airstrip One January 18, 2016 at 10:41 pm Man’s economy is a complex, dynamic system that defies these (and all previous nightmarish) attempts at centrally planned control… I’m sorry – but the flapping of a housewife’s butterfly wings in St. Louis buying some bread has not yet been well connected (by MMT computers) to the raging tempests of inflations occurring in the rest of the world as a result of our fiat-dollar hegemony.
          ]
        • JohnG January 22, 2016 at 8:17 pm # 
          This is a particular problem for Ex Post models like the Balance sheet identity represented by MMT theory in Sectoral balances.
          No it isn’t. You’ve misunderstood both the accounting and Steve Keen. Ot you are being disingenuous again.
          It isn’t a model you very silly person. It’s an accounting statement.
          I find it very difficult to believe you’ve been following Steve at all.