Indeed. The countries that practise MMT have done so for decades post 1970 and tend to be the more prosperous ones. I am talking about Europe, Japan, Murica, the ones that are heavily leveraged. If you think more debt leads to an economic apocalyse then why those countries prospered and third world countries that owe way, way less are struggling?
@@URProductions Running the economy is not managing your father's credit card. Your modern economy is run by debt and debt is a good thing in a modern economy, especially if it is debt in your own currency. Your logic that debt is bad would mean that you think the 2008 financial crisis is the best thing ever since banks daren't lend. If no one dares take up debt, how are you going to say build your infrastructure that requires a lot of financing? How are you going to run your business that requires you to take up debt storing and buying inventory, pay wages and so on? Debt is not a bad thing if you obviously can pay it back, if the debt is issued in its own currency. You think that spending limits should be based on a limited commodity instead of an economy's capacity and potential to produce. This is stupid and ruinous.
Here's my take: MMT works if you invest the money in things which turn out to provide a good economic return. But if you make poor spending decisions, it just leads to inflation. Much like how corporate debt can lead to either profit or bankruptcy, depending on how you spend the money you've borrowed.
For example: If you print money and build an international airport, and it turns out to be highly popular and successful. The increased economic activity will match the money you've printed. But if you print money and build a giant statue of John Maynard Keynes in every town. Then you're soon going to have a cost-of-living crisis.
@user-ib9ky2jo9h thats for complex reasons, alot of which involves new forms of corporate investing based on the idea of land as a investment rather than a right, wealth inequality, and depending on the country it can also be discriminatory immagration laws that incentivise wealthy future citizens to buy multiple properties far above market price. I get more into these bellow, but those are really the big 3 in canada and the US. If the wealthy get wealthier, they are willing to pay more for land they want, increasing the market cost. I live in a area that has been becoming increasingly tourist-y, and as rich people from cities come to purchase beach front property as a summer home, prices have increased dramatically. This has a ripple effect, where those who just sold their house far above the current market price will now move and purchase a new home somewhere else, likely above market price as well since they have the money, increasing the market price of houses outside of the tourist location. Depending on your area immagration laws that favor the rich can also raise prices. In canada those planning to immigrate here are far more likely to be allowed entry if they own both a business and a home. There are multiple essentailly empty stores downtown in the nearest urban area to me because wealthy people bought a store so they could live here, only open it one or two days a week so they can claim it as a business, and just sit on the property for a few years because they need to for immagration. They are often looking to get citizenship fast, and are often willing to pay 5 times market price for any property because my government decided that wealth and property should be the deciding factors for choosing who is worthy to be a canadain. This of course raises housing prices The final reason is big corporations. Companies like black rock have been buying thousands of family homes every month, and letting them sit empty until housing prices get high enough that they can rent these properties out for insane costs, artificially creating a housing crisis to proffit off of
If Apple goes bankrupt, tens of millions of people don't die. The government should not be gambling with the fate of a nation. They should make reasonable policies and extract reasonable taxes in order to uphold national institutions and laws.
@@user-ib9ky2jo9h Fair point. It was a deliberately absurd example. I think some more subtle and realistic examples which could also lead to inflation are… If you build misjudged infrastructure. (Such an international airport which proves unpopular.) If you invest in services which are morally good but not highly economically productive. (Such as elder care.) If you invest in services which take years to become economically productive. (Such as schools.) If you're trying to stimulate an economy which is incapable of being productive. (For example because all your workplaces are temporarily shut down.)
No the goverment needs taxes, because thats how it gives its currency value, and reinforces the value of a already established currency. Money means something to you because its the form of payment the goverment demands. Also aslong as the money printed by the goverment to fund something creates enough value to balance out the money printed, there is no inflation. And expanding on that, for money to maintain its relative value it also must be produced at a similar rate to economic growth or else you will have deflation. Printing money in and of itself doesn't cause inflation, its the relative distribution and use of the money. The idea of more money inherently causing inflation is a relic from the gold standard. If you want an example, think about americas debt. The majority of it is debt the goverment owes to itself, and litterally just printed money to do so. It has the ability to forgive this debt at any time, because it is the entity it owes money to, but it doesn't. The inflation caused by this wasn't even noticed by anyone because it was small, and the money added went to the wealthy through tax cuts, essentially increasing wealth inequality but not inflation. Thats still not good, and definitely not an ideal reason to print money, but it still was done within a comparatively reasonable amount, and therefore caused little inflation. When you dont use the gold standard, and stay within either a reasonable increase of currency, or use it well, or increase the amount of currency to match growth, then inflation just doesn't really happen
Yes exactly. And you can even induce growth by spending, for example if you employ unemployed people. If printing money devalues money, than why can we create 1 billion trillion dollar tomorrow and just let it sit on the bank account of the government, would it change anything? No. But what if we gave it to rich people, would it then cause inflation? Also no, because most rich people have already most things they want and they actually save a lot of money.
Very nice thoughts guys, I appreciate your respectful domineer. I didn't know that the government has a lot of debt to itself. but ( :P ) Even if the country continues to pull in taxes, even high taxes, its only a matter of time before the debt becomes so great that each dollar is worth an atom of gold. Now ever EVERY country is doing this, they can continue to sell and barter for atoms and sustain the global economy, probably infinity. But if think about it on a personal level, it means that my 2$ candy bar that used to be worth 2 ounces of gold is now only worth 1 atom. What I'm saying is the value of individual items would go down drastically, which wouldn't really be noticed because EVERYTHING would go down, but it would only take one country to stick to the golden standard ideology and pull ahead of the entire global economy just by not getting into debt. ...this is great I love how this has spawned a lively discussion.
@G.H.B.P. why? This logic only works for the gold standard. More money in a system doesn't automatically reduce the spending power of a dollar. America multiple times in the past has just printed tens or hundreds of billions of dollars, and nothing happened to inflation.
Modern Monetary Theory doesn't make our currency worthless... yet. The quiet part they don't say out loud is that the dollar is backed by the military industrial complex. The worth of trading in dollars is that you don't get invaded by the United States, or at the very least you will continue to experience the benefits of US protection. I think this system works just fine when you're the overwhelmingly dominant world superpower, as we have been for the past 30 years. Of course, things are changing, though. The shift back into a multipolar world puts us at serious risk.
@MephistoDerPudel No need to insult me to make your point.... MephistoDerPudel's argument: MMT does not state, that you can just print your way out of any problem, but rather that money isn't a governments problem. You can't print people or ressources, but if you have underutilized potential (e.g. unemployed people), the government can stimulate that without the need to care about its debt. If you just start spending on anything, that might be a different story and MMT does not say that it's completely irrelevant where a government spends its money. It's just, that the consequences differ from what other economic theories are telling you. And the predictions of MMT align better with reality, as far as I can tell.
@cecaloather8701 made a comment which I deleted due to a H-E-double hokey sticks. However for the sake of freedom of speech, here is what he said: Some people, (No finger pointing please) are comparing MMT to maxing out your dad's credit card. Very stupid comparison. Let me explain why. Then this raises the question. To whom a state practising MMT owes the money to? The difference is, your dad owes money to a creditor say a bank. In the case of a state practising MMT, the state only owes money to itself! The state unlike your father won't get into that trouble if it defaults! What these people don't understand is that in a modern economy, debt is a good thing especially if you are able to pay it back, if you are the one issuing your own debt. *[REDACTED], there is no need to pay it back in many cases in countries that practise MMT. Look at how heavily leveraged the wealthier countries are from Murica to Europe to Japan and even China! The poorer countries on the other hand are way less indebted but in deep trouble because they can't do MMT and owe money in other denominations.
on everything you mention up until the end where you mention inflation, every economist now disagrees with you. The only technical objection left to MMT is the inflation question (of course, libertarians and others may object just on principle)
Money is money if people think it has value. If you think MMT is bunk then ask yourselves this, why was the global economy stagnating pre-1971 before the USD was taken off the gold standard. Then post 1971, the countries that accumulated the most debt or are heavily leveraged are the more prosperous ones from Murica to Europe to Japan to tiny Singapore. That sort of debt is in the order of trillions. On the other hand, countries like Pakistan, Sri Lanka, countries in Latin America are impoverished despite oweing in the order of billions. For those of you who don't know, a billion is a thousand times less than a trillion.
You're ignoring the fact the greatest economic growth and rise in quality of living ever, happened in the 19th and early 20th centuries - while we were still on the gold standard. MMT is simply the macroeconomic version of stealing your dad's credit card. It might make you look prosperous for a while, but sooner or later the credit card maxes out.
@@cecaloather8701 HEY. be respectful of your opponents in a debate. I will not allow this to turn into one of those shouting matches the political figures are always getting into. instead of attacking your opponents viewpoint and trying to make him look stupid, just give a rebuttable and build your own. Here is is the essence of cecalotather8701 agument: look at the exponential GDP growth post WWII and 1971 and compare it to your so-called golden age. By the way, silver not gold is the global reserve currency of the 19th century. Ever asked yourself why was it silver instead of gold back then? Does it have to be silver or gold? Gold, like fiat, like silver, like copper, *[REDACTED]* even like cowries or cattle are just commodities with no intrinisic value. What makes them valuable is the trust of those issuing it as currency. If one insists on capping economic growth by limiting to a gold or silver or whatever standard, the economic progress post 1971 would not have happened. You say MMT is like maxing out credit cards. Well, are you suggesting that you wouldn't extend credit even during an economic recession then? Realise that debt is what that fuels the modern economy. No debt, no economic growth. Is an economy where banks don't lend healthy? Again, look at the debt in wealthy countries and the impoverished ones. If what you said were true then shouldn't the less indebted third world be more prosperous than the heavily leveraged first world? Isn't that like saying that the 2008 financial crisis is the best thing ever because there is lesser debt since banks don't lend?
Are you sure? Millei effectively made the USD not the peso as legal tender. How can you conduct MMT if you have no control over the peso? Why are you silent when you see developed countries get all the more richer the more money they print in the 80s and 90s? Murica is the country you should be looking at. If you have financial dominance over the globe and you have suckers that think your GBP, your USD, your Euro and their sovereign debt are good investments, you can do MMT.
@@ChannelMath Indeed. A lot of people who laugh at MMT which really is the explanation of what we saw in the global economy post Bretton Woods and gold standard neglect or refuse to see that if you are able to owe debt in YOUR OWN CURRENCY domination, there's not only no hyperinflation, you tend to do very well. The debtors post Bretton Woods have it easy. The poor creditors on the other hand like the countries of Latin America, Africa and South Asia are screwed owning debt in the currencies of the debtors and great powers.
@@cecaloather8701 first off milei has not done anything to the peso YET, it is also a misconception that what he intends is to "dollarize" the economy. the actual plan is transitioning into a free currency competition allowing for contracts of any nature to be made and paid in any currency that both parties agree to use. this will allow argentinians to use whichever currency is stronger at the moment and leave behind currencies which are either weak or prone to tampering, of which the USD seems like the latter these days (i myself will use the dollar for everyday transactions when the time comes but i plan to use swiss marks as value storage long term) after that the central bank is closed and left to rot as the shameful stain that it was in argentinian history, this will impede following goverments from ever financing debts with currency printing why oh why would we do this since "you see developed countries get all the more richer the more money they print"? well let me put it this way. Argentina was one of the richest countries if not THE richest country in the world in the late 1800's and early 1900's with the highest GDP per capita in the world between 1895 to 1896. by all means the most developed country of south america. And then came populism. be it yrigoyen, peron, the kirchner couple or any other half baked politician the formula was always the same, spend more money that you have to finance any needs and wants of the populace in order to get reelected, finance the resulting debt by printing money, blame the last guy for you "needing" to do the exact same, rinse and repeat. this produced what you would expect. of the last 122 years argentina suffered a fiscal deficit during 112, generating the neverending streams of crisis after crisis we've lived through the last century. out of the entire population we are currently sitting at a comfy 50% poverty and 10% extreme poverty half of the workforce and the economy is in the black market thanks to regulation, inflation and exhorbitant taxes. the central bank emiting money to pay government debt racked so much inflation that we KILLED 4 CURRENCIES, one after another after another, we are currently in our 5th and hopefully last. TLDR: you can't sell modern monetary theory to someone who has lived through it's horrors. also this reminds me... czcams.com/video/Wv_0_Lu_Iyo/video.html&ab_channel=TheBabylonBee same energy. @G.H.B.P. once again amazing video, don't let anyone tell you otherwise. thats a subscribe and bell from me
Sadly think you are wrong here. The excuse is that *we don't have the money for hospitals* but we sure seem to have the money in millions to give to businesses and murder people millions of miles away. An alternative method is thinking of spending money as *borrowing against the value of the dollar* every dollar you print is reducing the value of all subsequent dollars. Where you are incorrect is if this spending occurs in things that *will* increase the value of the dollar in the future. This is concept is applicable to governments and There is a natural hitch there. China spending billions on railways is good and improved the infrastructure, but eventually building those railways have declining returns. Lets propose a thought experiment. What if rather then increasing taxes, we printed money. In this situation the dollar value would go down / inflation would go up and comparatively this is a taxation... The issue is the wealthy can dodge taxes. They can only dodge inflation by moving their money out of the currency... Kinda makes you wonder why we are so obsessed with keeping inflation down...
What you don't understand is that the government can only print extra pieces of paper. That's not the same as printing what you consider to be money. Money is just a physical representation of valuable things in the economy. And the government can't print more of those. Only productive business can. If the government prints money is just more paper to go around
When the government wants more money, they "sell" Bonds to the Central Bank. The Central Bank then issues billions of $ out of thin air to "pay" for these Bonds. The same thing happens when you get a mortgage. Your local bank "borrows" money from the Central Bank, who just issue it out of thin air. That's why housing prices are so high - there's no upper limit on housing costs when there's no upper limit on how much the bank can lend. Central Banks control the money. Technically they aren't a part of the government, but realistically they are.
@@URProductions Go watch "Money as debt". Then watch the videos which try to debunk that. Then try to find out what happened in 1913 with the federal reserve act. Then try to find out who control when new money is created. Then wonder why that's not the government.
@@URProductions My bad. It's amazing how people think is reasonable for a country to need to ask someone else for it to be allowed to create new money.
@@URProductions only people who wanted to be fooled, it is more of a post facto narrative to give people justification for what htey were already gana do
Even in MMT countries would still need taxes to create demand/value for the currency.
Indeed. The countries that practise MMT have done so for decades post 1970 and tend to be the more prosperous ones. I am talking about Europe, Japan, Murica, the ones that are heavily leveraged.
If you think more debt leads to an economic apocalyse then why those countries prospered and third world countries that owe way, way less are struggling?
@@cecaloather8701 That's like saying "look how rich I am" after nearly maxing out my father's credit card.
@@URProductions Running the economy is not managing your father's credit card. Your modern economy is run by debt and debt is a good thing in a modern economy, especially if it is debt in your own currency.
Your logic that debt is bad would mean that you think the 2008 financial crisis is the best thing ever since banks daren't lend. If no one dares take up debt, how are you going to say build your infrastructure that requires a lot of financing? How are you going to run your business that requires you to take up debt storing and buying inventory, pay wages and so on?
Debt is not a bad thing if you obviously can pay it back, if the debt is issued in its own currency.
You think that spending limits should be based on a limited commodity instead of an economy's capacity and potential to produce. This is stupid and ruinous.
@@cecaloather8701 Thanks for the feed back bro!
I appreciate your explanations, thanks for explaining it further!
Here's my take: MMT works if you invest the money in things which turn out to provide a good economic return. But if you make poor spending decisions, it just leads to inflation. Much like how corporate debt can lead to either profit or bankruptcy, depending on how you spend the money you've borrowed.
For example: If you print money and build an international airport, and it turns out to be highly popular and successful. The increased economic activity will match the money you've printed.
But if you print money and build a giant statue of John Maynard Keynes in every town. Then you're soon going to have a cost-of-living crisis.
@@andybrice2711 except nobody did anything like the second thing but lots of places have cost of living crises.
@user-ib9ky2jo9h thats for complex reasons, alot of which involves new forms of corporate investing based on the idea of land as a investment rather than a right, wealth inequality, and depending on the country it can also be discriminatory immagration laws that incentivise wealthy future citizens to buy multiple properties far above market price.
I get more into these bellow, but those are really the big 3 in canada and the US.
If the wealthy get wealthier, they are willing to pay more for land they want, increasing the market cost. I live in a area that has been becoming increasingly tourist-y, and as rich people from cities come to purchase beach front property as a summer home, prices have increased dramatically.
This has a ripple effect, where those who just sold their house far above the current market price will now move and purchase a new home somewhere else, likely above market price as well since they have the money, increasing the market price of houses outside of the tourist location.
Depending on your area immagration laws that favor the rich can also raise prices. In canada those planning to immigrate here are far more likely to be allowed entry if they own both a business and a home.
There are multiple essentailly empty stores downtown in the nearest urban area to me because wealthy people bought a store so they could live here, only open it one or two days a week so they can claim it as a business, and just sit on the property for a few years because they need to for immagration.
They are often looking to get citizenship fast, and are often willing to pay 5 times market price for any property because my government decided that wealth and property should be the deciding factors for choosing who is worthy to be a canadain. This of course raises housing prices
The final reason is big corporations. Companies like black rock have been buying thousands of family homes every month, and letting them sit empty until housing prices get high enough that they can rent these properties out for insane costs, artificially creating a housing crisis to proffit off of
If Apple goes bankrupt, tens of millions of people don't die. The government should not be gambling with the fate of a nation. They should make reasonable policies and extract reasonable taxes in order to uphold national institutions and laws.
@@user-ib9ky2jo9h Fair point. It was a deliberately absurd example. I think some more subtle and realistic examples which could also lead to inflation are…
If you build misjudged infrastructure. (Such an international airport which proves unpopular.)
If you invest in services which are morally good but not highly economically productive. (Such as elder care.)
If you invest in services which take years to become economically productive. (Such as schools.)
If you're trying to stimulate an economy which is incapable of being productive. (For example because all your workplaces are temporarily shut down.)
No the goverment needs taxes, because thats how it gives its currency value, and reinforces the value of a already established currency. Money means something to you because its the form of payment the goverment demands.
Also aslong as the money printed by the goverment to fund something creates enough value to balance out the money printed, there is no inflation.
And expanding on that, for money to maintain its relative value it also must be produced at a similar rate to economic growth or else you will have deflation.
Printing money in and of itself doesn't cause inflation, its the relative distribution and use of the money. The idea of more money inherently causing inflation is a relic from the gold standard.
If you want an example, think about americas debt. The majority of it is debt the goverment owes to itself, and litterally just printed money to do so. It has the ability to forgive this debt at any time, because it is the entity it owes money to, but it doesn't.
The inflation caused by this wasn't even noticed by anyone because it was small, and the money added went to the wealthy through tax cuts, essentially increasing wealth inequality but not inflation. Thats still not good, and definitely not an ideal reason to print money, but it still was done within a comparatively reasonable amount, and therefore caused little inflation.
When you dont use the gold standard, and stay within either a reasonable increase of currency, or use it well, or increase the amount of currency to match growth, then inflation just doesn't really happen
Yes exactly. And you can even induce growth by spending, for example if you employ unemployed people. If printing money devalues money, than why can we create 1 billion trillion dollar tomorrow and just let it sit on the bank account of the government, would it change anything? No. But what if we gave it to rich people, would it then cause inflation? Also no, because most rich people have already most things they want and they actually save a lot of money.
Very nice thoughts guys, I appreciate your respectful domineer. I didn't know that the government has a lot of debt to itself.
but ( :P )
Even if the country continues to pull in taxes, even high taxes, its only a matter of time before the debt becomes so great that each dollar is worth an atom of gold. Now ever EVERY country is doing this, they can continue to sell and barter for atoms and sustain the global economy, probably infinity. But if think about it on a personal level, it means that my 2$ candy bar that used to be worth 2 ounces of gold is now only worth 1 atom. What I'm saying is the value of individual items would go down drastically, which wouldn't really be noticed because EVERYTHING would go down, but it would only take one country to stick to the golden standard ideology and pull ahead of the entire global economy just by not getting into debt.
...this is great I love how this has spawned a lively discussion.
@G.H.B.P. why? This logic only works for the gold standard. More money in a system doesn't automatically reduce the spending power of a dollar.
America multiple times in the past has just printed tens or hundreds of billions of dollars, and nothing happened to inflation.
Modern Monetary Theory doesn't make our currency worthless... yet. The quiet part they don't say out loud is that the dollar is backed by the military industrial complex. The worth of trading in dollars is that you don't get invaded by the United States, or at the very least you will continue to experience the benefits of US protection. I think this system works just fine when you're the overwhelmingly dominant world superpower, as we have been for the past 30 years. Of course, things are changing, though. The shift back into a multipolar world puts us at serious risk.
thanks for the feedback, very interesting thoughts.
As it turns out when you strawman a theory it tends to sound idiotic
Though it is really stupid, just not for this reason
mmt really is a terrible idea, what's wrong with his explanation?
Not a strawman at all. Yes, the actual theory of MMT is a lot more complex than this. But this sums it up pretty aptly.
oh no XD
were do you see I puled a straw man?
@MephistoDerPudel
No need to insult me to make your point....
MephistoDerPudel's argument:
MMT does not state, that you can just print your way out of any problem, but rather that money isn't a governments problem. You can't print people or ressources, but if you have underutilized potential (e.g. unemployed people), the government can stimulate that without the need to care about its debt.
If you just start spending on anything, that might be a different story and MMT does not say that it's completely irrelevant where a government spends its money. It's just, that the consequences differ from what other economic theories are telling you. And the predictions of MMT align better with reality, as far as I can tell.
Go watch "money as debt".
Is that another video about MMT?
@cecaloather8701 made a comment which I deleted due to a H-E-double hokey sticks. However for the sake of freedom of speech, here is what he said:
Some people, (No finger pointing please) are comparing MMT to maxing out your dad's credit card. Very stupid comparison. Let me explain why.
Then this raises the question. To whom a state practising MMT owes the money to?
The difference is, your dad owes money to a creditor say a bank. In the case of a state practising MMT, the state only owes money to itself! The state unlike your father won't get into that trouble if it defaults!
What these people don't understand is that in a modern economy, debt is a good thing especially if you are able to pay it back, if you are the one issuing your own debt.
*[REDACTED], there is no need to pay it back in many cases in countries that practise MMT. Look at how heavily leveraged the wealthier countries are from Murica to Europe to Japan and even China!
The poorer countries on the other hand are way less indebted but in deep trouble because they can't do MMT and owe money in other denominations.
on everything you mention up until the end where you mention inflation, every economist now disagrees with you. The only technical objection left to MMT is the inflation question (of course, libertarians and others may object just on principle)
My economics teacher agrees with me.
...I agree with me....
Money is money if people think it has value. If you think MMT is bunk then ask yourselves this, why was the global economy stagnating pre-1971 before the USD was taken off the gold standard.
Then post 1971, the countries that accumulated the most debt or are heavily leveraged are the more prosperous ones from Murica to Europe to Japan to tiny Singapore. That sort of debt is in the order of trillions.
On the other hand, countries like Pakistan, Sri Lanka, countries in Latin America are impoverished despite oweing in the order of billions. For those of you who don't know, a billion is a thousand times less than a trillion.
You're ignoring the fact the greatest economic growth and rise in quality of living ever, happened in the 19th and early 20th centuries - while we were still on the gold standard.
MMT is simply the macroeconomic version of stealing your dad's credit card. It might make you look prosperous for a while, but sooner or later the credit card maxes out.
@@cecaloather8701 HEY.
be respectful of your opponents in a debate. I will not allow this to turn into one of those shouting matches the political figures are always getting into.
instead of attacking your opponents viewpoint and trying to make him look stupid, just give a rebuttable and build your own.
Here is is the essence of cecalotather8701 agument:
look at the exponential GDP growth post WWII and 1971 and compare it to your so-called golden age.
By the way, silver not gold is the global reserve currency of the 19th century. Ever asked yourself why was it silver instead of gold back then? Does it have to be silver or gold?
Gold, like fiat, like silver, like copper, *[REDACTED]* even like cowries or cattle are just commodities with no intrinisic value. What makes them valuable is the trust of those issuing it as currency.
If one insists on capping economic growth by limiting to a gold or silver or whatever standard, the economic progress post 1971 would not have happened.
You say MMT is like maxing out credit cards. Well, are you suggesting that you wouldn't extend credit even during an economic recession then?
Realise that debt is what that fuels the modern economy. No debt, no economic growth. Is an economy where banks don't lend healthy? Again, look at the debt in wealthy countries and the impoverished ones.
If what you said were true then shouldn't the less indebted third world be more prosperous than the heavily leveraged first world? Isn't that like saying that the 2008 financial crisis is the best thing ever because there is lesser debt since banks don't lend?
Argentinian poll watcher for LLA here.
I can attest to the horrors this theory generates when taken into practice.
Great video
Are you sure? Millei effectively made the USD not the peso as legal tender. How can you conduct MMT if you have no control over the peso?
Why are you silent when you see developed countries get all the more richer the more money they print in the 80s and 90s? Murica is the country you should be looking at.
If you have financial dominance over the globe and you have suckers that think your GBP, your USD, your Euro and their sovereign debt are good investments, you can do MMT.
If you have a massive debt in dollars, MMT doesn't apply. You have a large dollar economy that's not sovereign.
i think he's talking about pre-Milei @@cecaloather8701
@@ChannelMath Indeed. A lot of people who laugh at MMT which really is the explanation of what we saw in the global economy post Bretton Woods and gold standard neglect or refuse to see that if you are able to owe debt in YOUR OWN CURRENCY domination, there's not only no hyperinflation, you tend to do very well.
The debtors post Bretton Woods have it easy. The poor creditors on the other hand like the countries of Latin America, Africa and South Asia are screwed owning debt in the currencies of the debtors and great powers.
@@cecaloather8701 first off milei has not done anything to the peso YET, it is also a misconception that what he intends is to "dollarize" the economy.
the actual plan is transitioning into a free currency competition allowing for contracts of any nature to be made and paid in any currency that both parties agree to use.
this will allow argentinians to use whichever currency is stronger at the moment and leave behind currencies which are either weak or prone to tampering, of which the USD seems like the latter these days (i myself will use the dollar for everyday transactions when the time comes but i plan to use swiss marks as value storage long term)
after that the central bank is closed and left to rot as the shameful stain that it was in argentinian history, this will impede following goverments from ever financing debts with currency printing
why oh why would we do this since "you see developed countries get all the more richer the more money they print"? well let me put it this way.
Argentina was one of the richest countries if not THE richest country in the world in the late 1800's and early 1900's with the highest GDP per capita in the world between 1895 to 1896. by all means the most developed country of south america.
And then came populism.
be it yrigoyen, peron, the kirchner couple or any other half baked politician the formula was always the same, spend more money that you have to finance any needs and wants of the populace in order to get reelected, finance the resulting debt by printing money, blame the last guy for you "needing" to do the exact same, rinse and repeat.
this produced what you would expect.
of the last 122 years argentina suffered a fiscal deficit during 112, generating the neverending streams of crisis after crisis we've lived through the last century.
out of the entire population we are currently sitting at a comfy 50% poverty and 10% extreme poverty
half of the workforce and the economy is in the black market thanks to regulation, inflation and exhorbitant taxes.
the central bank emiting money to pay government debt racked so much inflation that we KILLED 4 CURRENCIES, one after another after another, we are currently in our 5th and hopefully last.
TLDR: you can't sell modern monetary theory to someone who has lived through it's horrors.
also this reminds me...
czcams.com/video/Wv_0_Lu_Iyo/video.html&ab_channel=TheBabylonBee
same energy.
@G.H.B.P. once again amazing video, don't let anyone tell you otherwise.
thats a subscribe and bell from me
Sadly think you are wrong here.
The excuse is that *we don't have the money for hospitals* but we sure seem to have the money in millions to give to businesses and murder people millions of miles away.
An alternative method is thinking of spending money as *borrowing against the value of the dollar* every dollar you print is reducing the value of all subsequent dollars.
Where you are incorrect is if this spending occurs in things that *will* increase the value of the dollar in the future. This is concept is applicable to governments and
There is a natural hitch there. China spending billions on railways is good and improved the infrastructure, but eventually building those railways have declining returns.
Lets propose a thought experiment. What if rather then increasing taxes, we printed money. In this situation the dollar value would go down / inflation would go up and comparatively this is a taxation...
The issue is the wealthy can dodge taxes. They can only dodge inflation by moving their money out of the currency...
Kinda makes you wonder why we are so obsessed with keeping inflation down...
The government does not control when new money is created. It should. It does not. That's the problem.
What you don't understand is that the government can only print extra pieces of paper. That's not the same as printing what you consider to be money. Money is just a physical representation of valuable things in the economy. And the government can't print more of those. Only productive business can. If the government prints money is just more paper to go around
When the government wants more money, they "sell" Bonds to the Central Bank. The Central Bank then issues billions of $ out of thin air to "pay" for these Bonds.
The same thing happens when you get a mortgage. Your local bank "borrows" money from the Central Bank, who just issue it out of thin air. That's why housing prices are so high - there's no upper limit on housing costs when there's no upper limit on how much the bank can lend.
Central Banks control the money. Technically they aren't a part of the government, but realistically they are.
@@URProductions Go watch "Money as debt". Then watch the videos which try to debunk that. Then try to find out what happened in 1913 with the federal reserve act. Then try to find out who control when new money is created. Then wonder why that's not the government.
@@markboggs746 Way ahead of you, man. I already know all that stuff. FDR, Nixon, 2008, the whole ugly story.
@@URProductions My bad. It's amazing how people think is reasonable for a country to need to ask someone else for it to be allowed to create new money.
a theory so dumb only a PhD holder would believe in it. the result of people without consequences
The theory is actually quite brilliant - it successfully fooled millions of people for generations!
@@URProductions only people who wanted to be fooled, it is more of a post facto narrative to give people justification for what htey were already gana do
hey you know someone came up with that theory, be nice.