Bottom line:
1. Low interest rates are not stimulative; high rates are stimulative.
2. High rates fight inflation.
3. Federal deficit spending has not caused inflation for 60 years, though deficit spending is stimulative.
So to grow the economy without inflation, raise interest rates and increase deficit spending.Read it at Monetary Sovereignty
Which is the greater threat: Inflation or recession?
by Rodger Malcolm Mitchell
6 comments:
Rodger Malcolm Mitchell seems to be something of a black sheep in the modern money community. Or a loan wolf? :)
I'd like to see some MMT people engage his views on how best to address unwanted inflation if/when it starts.
Which is the greater threat: Inflation or recession?
This is like asking which is the greater threat: Drinking more alcohol, or experiencing a hang-over?
Inflation BRINGS ABOUT recessions. Recessions are not inherent in free market activity.
"Recessions are not inherent in free market activity."
Oh God... clueless.
There is no unemployment in a subsistence economy.
Anonymous:
Oh God... clueless.
I agree, you are clueless.
Tom Hickey:
There is no unemployment in a subsistence economy.
Good thing employment is but a means to an end, not an end in itself, in which case any economy that promises employment, would not be promising final utility, but promising a means instead.
I'm a big fan of Rodger's. He has some subtle points which justifies his views of "monetary sovereignty" as separate from MMT, but 99% of the time he's on the same page. I actually prefer the term monetary sovereignty over MMT as the "theory" part of MMT seems to weaken its argument.
Post a Comment