296 Responses to Mike Norman Economics: General theory and special cases in Modern Monetary Theory

1. Art says:

   June 26, 2012 @ 9:18 pm (Tuesday) at 9:18 pm

   Warren: “I can’t recall any of it being refudiated.”

   I hope that was intentional. Lucky for you no grizzly mamas in the tropics. :)

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   WARREN MOSLER Reply:
   June 27th, 2012 at 10:38 pm

   ;)

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2. y says:

   June 25, 2012 @ 10:41 am (Monday) at 10:41 am

   Warren,

   “Look at how much the MMR guys have done to get the word out, for example. (And I’m still not sure they actually differ from what I say?)”

   Unfortunately Cullen Roche (over at the MMR site) is the one coming up with the nonsense being spouted here by FDO15.

   Perhaps you should have a word with Cullen to find out why he is spreading this nonsense. Impressionable people like FDO15 are clearly getting quite confused by it.

   You asked FD015 “where are you getting this stuff?” The answer is he’s getting it from Cullen Roche over at MMR.

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   WARREN MOSLER Reply:
   June 25th, 2012 at 10:53 am

   ok, good to know thanks.

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3. stx says:

   June 24, 2012 @ 9:56 am (Sunday) at 9:56 am

   As a novice and interested observer it seems there are slippery words and confusion on whatever principles there are. I personally have a hard time learning MMT as it doesn’t seem to be defined in a rigorous manner. I grew up learning geometry with postulates, theorems, definitions and proofs. Defining MMT rigorously would put everyone on the same track and help discussions.

   On a side note, why does the government shut down banks?

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   WARREN MOSLER Reply:
   June 24th, 2012 at 11:43 am

   failure to comply with what are called camels standards- capital, asset quality, management, earnings, liquidity, interest rate sensitivity

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   y Reply:
   June 25th, 2012 at 7:12 am

   Which bits don’t you understand?

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   y Reply:
   June 25th, 2012 at 10:18 am

   Warren,

   “the fed allows it’s member banks- it’s designated agents- to ‘create’ reserve balances within the regulatory framework.

   This framework includes reserve requirements as well as extensive regulation on what type of loans/assets are allowed and not allowed. So if a bank creates a loan/deposit/reserves it’s done so within the regulatory framework as a agent of government.”

   – When you say the fed allows its member banks to ‘create’ reserve balances, do you mean the fed allows member banks to become ‘overdrawn’? Why do you put ‘create’ in speech marks?

   Could you clarify specifically what you mean in detail when you say member banks ‘create’ reserve balances?

   thanks!

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   WARREN MOSLER Reply:
   June 25th, 2012 at 10:52 am

   Bank deposits are the accounting record of the liability associated with loans.

   So when a bank lends you $100 they might at the same time enter the number ‘100’ into your checking account.
   But the loan didn’t do the entering of the 100 into your account per se. The 100 liability is the accounting record of the loan. liabilities are accounting records off assets, etc.

   When you account for something you don’t exactly ‘create’ it the way the word ‘create’ is generally understood-
   making something out of something else, etc.

   What I mean by allowing banks to create reserves is that regulation allows banks to make loans and corresponding deposits that it will accept for payment of taxes recognizing that they are allowing that bank to incur a reserve deficiency in the case of reserve requirements. Additionally, when the Fed ‘clears a check’ it’s allowing the possibility of the account debited to be overdrawn which is also the possibility of a loan from the Fed.

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4. y says:

   June 24, 2012 @ 8:41 am (Sunday) at 8:41 am

   All you two have is garbled nonsense and offensive rants.

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