Modern Monetary Theory

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Re: Modern Monetary Theory

Postby Elvis » Wed Jul 20, 2022 7:58 pm

New book by Brett Scott looks terrific!

https://www.harperacademic.com/book/978 ... loudmoney/

Cloudmoney - Cash, Cards, Crypto, and the War for Our Wallets

by Brett Scott
About the Book

The reach of Corporations into our lives via cards and apps has never been greater; many of us rarely use cash these days. But what we’re told is a natural and inevitable move is actually the work of powerful interests. And the great battle of our time is the battle for ownership of the digital footprints that make up our lives.

In Cloudmoney, Brett Scott tells an urgent and revelatory story about how the fusion of Big Finance and Big Tech requires “cloudmoney”—digital money underpinned by the banking sector—to replace physical cash. He dives beneath the surface of the global financial system to uncover a long-established lobbying infrastructure: an alliance of partners waging a covert war on cash. He explains the technical, political, and cultural differences between our various forms of money and shows how the cash system has been under attack for decades, as banking and tech companies promote a cashless society under the banner of progress.

Cloudmoney takes us to the front lines of a war for our wallets that is also about our freedom, from marketing strategies against cash to the weaponization of COVID-19 to push fintech platforms, and from there to the rise of the cryptocurrency rebels and fringe groups pushing back. It asks the most pressing questions:

Who benefits from a cashless society and who gets left behind?

Is the end of cash the end of true privacy?

And is our cloudmoney future closer than we think it is?



Critical Praise

“An important reflection on the new world of finance. Brett Scott writes with gusto about blockchain, crypto, and the power nexus between Big Tech and the banks in a cashless society.” — Lionel Barber, journalist and former editor of the Financial Times

“A fascinating and readable guide to the future, and how we can reclaim that future from the clutches of Big Finance and Big Tech.” — Grace Blakeley, author of The Corona Crash and Stolen

“A brilliant, fascinating, and utterly accessible book—a pioneering and political guide to the fast-evolving web of global finance. Combining anthropological insight with the financial acumen of an industry insider, Scott lays out the long view on how tech and finance are rapidly merging to supercharge corporate capitalism. If you want to understand what money is—and what it is in danger of becoming—start right here.” — Kate Raworth, cofounder of Doughnut Economics Action Lab and author of Doughnut Economics

“In a book that is simultaneously irreverent, hard-hitting, and entertaining, Brett Scott blows apart conventional myths about cash, digital money, and crypto, and brilliantly shows us what’s at stake in the coming battles for the soul of money.” — Stephanie Kelton, author of the New York Times bestseller The Deficit Myth

“Told with authority and clarity.” — Kirkus Reviews


I became a fan of Brett Scott through his excellent blog and YouTube channel.


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Re: Modern Monetary Theory

Postby Elvis » Wed Jul 20, 2022 8:19 pm

Elvis wrote:Ben Ritz, Director of PPI’s Center for Funding America’s Future. “Now that inflation has finally materialized, they’ve moved the goalposts and left policymakers seeking answers about what to do in response.


As an example of how impotent the orthodox theory of inflation is, these, based on the mainstream model, are ECB inflation forecasts:


ECB inflation forecasts g.jpg



Does it look like the ECB's mainstream theory of inflation works? Whatsoever?

Comedy or tragedy?
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Re: Modern Monetary Theory

Postby Elvis » Wed Jul 20, 2022 8:32 pm

This is really good. And funny. :lol:



https://www.youtube.com/watch?v=ZAMtgCtq1oU


He's a physician and his YouTube channel is full of gems.
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Re: Modern Monetary Theory

Postby JackRiddler » Wed Jul 20, 2022 10:37 pm

Elvis » Wed Jul 20, 2022 7:19 pm wrote:
Elvis wrote:Ben Ritz, Director of PPI’s Center for Funding America’s Future. “Now that inflation has finally materialized, they’ve moved the goalposts and left policymakers seeking answers about what to do in response.


As an example of how impotent the orthodox theory of inflation is, these, based on the mainstream model, are ECB inflation forecasts:


ECB inflation forecasts g.jpg



Does it look like the ECB's mainstream theory of inflation works? Whatsoever?

Comedy or tragedy?


The genre is class war.
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Re: Modern Monetary Theory

Postby drstrangelove » Thu Jul 21, 2022 3:32 am

do mmt theorists generally believe the US central banking system(including treasury) is a private or public monopoly over the supply of credit? i don't mean in theory, i mean in practice. say, since the 1970s.
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Re: Modern Monetary Theory

Postby Elvis » Thu Jul 21, 2022 5:27 pm

drstrangelove » Thu Jul 21, 2022 12:32 am wrote:do mmt theorists generally believe the US central banking system(including treasury) is a private or public monopoly over the supply of credit? i don't mean in theory, i mean in practice. say, since the 1970s.


My understanding is that MMT posits that the government—Fed+Treasury (ultimately Congress)—holds a public monopoly over the supply of credit, but doesn't fully exercise it.

The rise of 'shadow banking' is an example of private credit creation running amuck.
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Re: Modern Monetary Theory

Postby Elvis » Thu Jul 21, 2022 5:32 pm

:thumbsup

JackRiddler wrote:
Comedy or tragedy?




The genre is class war.
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Re: Modern Monetary Theory

Postby Joe Hillshoist » Fri Jul 22, 2022 8:36 am

Elvis » 21 Jul 2022 10:32 wrote:This is really good. And funny. :lol:



https://www.youtube.com/watch?v=ZAMtgCtq1oU


He's a physician and his YouTube channel is full of gems.


Reminds me of the joke about breaking bad in Australia.
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Re: Modern Monetary Theory

Postby Elvis » Fri Jul 22, 2022 5:36 pm

Joe Hillshoist wrote:Reminds me of the joke about breaking bad in Australia.


:shrug: The TV show? I haven't seen it, what is the joke?
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Re: Modern Monetary Theory

Postby Joe Hillshoist » Sat Jul 23, 2022 11:18 pm

The show is about a high school chemistry teacher who starts cooking meth after he's diagnosed with cancer.

Its pretty lame but basically, Breaking Bad in Australia - teacher gets cancer, teacher gets treatment on medicare, teacher goes home.
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Re: Modern Monetary Theory

Postby Elvis » Sun Jul 24, 2022 1:35 am

Joe Hillshoist wrote: Breaking Bad in Australia - teacher gets cancer, teacher gets treatment on medicare, teacher goes home.


Good one! :lol:
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Re: Modern Monetary Theory

Postby Elvis » Sun Jul 24, 2022 1:40 am

In other news...

Share of Labor Compensation in GDP for the US


Labor share of GDP.png
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Re: Modern Monetary Theory

Postby Elvis » Mon Aug 08, 2022 7:04 pm

Dean Baker is good, and this September 2021 piece is as relevant as ever.

https://cepr.net/winning-the-tax-game-t ... k-returns/

Winning the Tax Game: Tax Stock Returns
09/28/2021 12:00am
Dean Baker

President Biden efforts to raise taxes on corporations and the wealthy has been getting seriously bogged down in recent weeks. More conservative Democrats have objected to the 28 percent corporate tax rate he proposed. Others seem to have nixed plans for raising the estate tax by making the capital gains held by large estates taxable. And, the Republicans working on the bipartisan infrastructure package were adamantly opposed to increasing the resources available to the I.R.S. so that it could better crack down on tax cheats.

Sometimes, when a particular game is not going well, the best way to turn things around is to change the game. Congress can still do this. The way to do this is to change the basis for the corporate income tax from profits to stock returns.

The key advantage to this switch is that profit is not a well-defined concept. The money that companies pay for things like wages or electricity are treated as expenses that are subtracted directly from income when calculating profits. However, the money they spend building a factory or setting up a new computer system is treated as an investment, which must be depreciated over a number of years.

Determining which spending falls into each category, and the number of years over which an item should be depreciated, are topics that can employ tens of thousands of accountants, tax lawyers, and lobbyists. And, this is just one of the ambiguities in calculating profit.

By contrast, stock returns are very well defined. It’s just a matter of adding up the dividends a company paid out and the amount that its stock price went up over the course of the tax year. The I.R.S. can get this information from any number of business websites. It then just applies, say a 25 percent tax rate, and it can calculate the tax liability of every publicly traded company on a single spreadsheet. It doesn’t get much simpler than that.

There is an issue that stock prices are more volatile than profits. That one can be easily dealt with by making the basis for the tax an average of stock returns for the prior three or five years. We’re still on the same spreadsheet.

There are companies, like Tesla, that have seen extraordinary runups in stock price that are completely out of line with their profits. These companies would face a substantial increase in their tax liability even if they averaged returns over the prior three or five years.

There is a simple and obvious answer for companies that find themselves in this situation: issue more shares of stock. Of course, these companies will not want to see their stock diluted by additional shares, but that’s life. No one likes paying taxes.

Most of our major corporations are multinational, which means their profits come in part from other countries. This is also a huge problem under the current tax code. The obvious solution is to allocate stock returns in proportion to sales. If 60 percent of their sales are in the United States, then we tax 60 percent of their stock returns. We’re still on a single spreadsheet.

There is the issue of companies that are privately held, without publicly traded shares. These companies would still have to be taxed based on their profits. But that is not a major problem for this system.

The overwhelming majority of profits are earned by publicly traded companies, so if we have a simple formula for determining their tax liability, we’ve largely solved the problem. Furthermore, we can structure the tax code to give companies an incentive to go public, for example by having a slightly lower tax rate for publicly traded companies.

For companies that are not looking to game the tax system, making stock returns the basis for the income tax should already offer a large benefit in terms of savings on accounting costs. They would not have to keep careful records to send to the I.R.S. at tax time. They just need to calculate their stock returns and send a check.

This simplicity alone should be a big enough advantage to encourage many privately traded companies to go public. Constructing the choice this way also is helpful to the I.R.S. Companies that choose to remain private when they could otherwise save compliance costs by going public are in effect telling the I.R.S. that they are looking to game the system.

The enormous savings on oversight for the I.R.S. on the corporate side should also make it much easier to police individual returns. If Republicans in Congress won’t directly give the I.R.S. additional funds for cracking down on tax cheats, the Democrats can provide the resources indirectly by making the corporate side more efficient.

In short, making stock returns the basis for the corporate income tax is a game where everyone but the tax cheats win.

“The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.” ― Joan Robinson
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Re: Modern Monetary Theory

Postby JackRiddler » Mon Aug 08, 2022 9:25 pm

Elvis » Sun Jul 24, 2022 12:40 am wrote:In other news...

Share of Labor Compensation in GDP for the US


Labor share of GDP.png


In a world of misleading cumulative-synthetic stat preesentations, there are still gems that tell a whole history in a single chart. Every bend and trend in this curve has a story to it. It's beautiful. (I mean, beautifully done, not the outcome.)
We meet at the borders of our being, we dream something of each others reality. - Harvey of R.I.

To Justice my maker from on high did incline:
I am by virtue of its might divine,
The highest Wisdom and the first Love.

TopSecret WallSt. Iraq & more
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Re: Modern Monetary Theory

Postby Elvis » Mon Aug 08, 2022 10:23 pm

Yes, especially notable for me is the precipitous drop following the four consecutive budget surpluses of the late '90s-2000.

JackRiddler » Mon Aug 08, 2022 6:25 pm wrote:
Elvis » Sun Jul 24, 2022 12:40 am wrote:In other news...

Share of Labor Compensation in GDP for the US


Labor share of GDP.png


In a world of misleading cumulative-synthetic stat preesentations, there are still gems that tell a whole history in a single chart. Every bend and trend in this curve has a story to it. It's beautiful. (I mean, beautifully done, not the outcome.)
“The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.” ― Joan Robinson
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