Wealth Distortion

[Martin Hash]

Modern Monetary Theory (MMT) is the idea that there can be an unlimited supply of imaginary money, so if the stock market needs money, or businesses, or even everybody, then the government can just print it. This concept solves several problems, one of which is wealth redistribution, at least on the surface: if everyone were given a million dollars, average income would increase, and in fact the mana from raining down from heaven during the Shamdemic was the greatest increase in average household income in America's history. But the nature of Capitalism is that wealth accumulates, so all those million dollar checks eventually end up in the hands of the most wealthy people; trillionaires in the making; nobody’s hurt by wealth inequality in a financial sense if money falls out of the trees.

However, there is one distortion of this endless supply of imagination that is fatal: when only a few people have so much money that losing hundreds of billions means nothing to them, then Market Forces no longer function. A trillionaire can buy every news organization, every movie studio, support every university endowment, finance every candidate, and do with them as s/he pleases because, why not? When something imaginary has control over reality, it becomes religion, and whoever speaks to God can tell everyone else what to do.

[C-Mag]

I see reports of Wall Street buying up single family homes across the country. This is pushing all average folks out of the market. No such thing as a starter home anymore. Unless your upper middle class, you probably can't afford a home.

That's not going to work for very long.

I hear the redditors at Wall Street bets are predicting the economy will crash be the end of the year.

[DBTrek]

I always thought the idea of "printing money" to avoid economic crises was patently ridiculous. Money is just a medium of exchange. You need to have people producing, and people consuming. When we're producing less and less, and people are consuming more and more, doesn't really matter how much more of the "medium of exchange" you crank out ... people want more shit than there is to supply to them.

If a million people want cheeseburgers, but labor only created 10k, then does it really matter how much money you print cram in people's pockets? I guess it matters on the level that you might be able to cram your cronies pockets with the most, to ensure they get cheeseburgers - but beyond that - a dollar, ten dollars, a trillion dollars per cheeseburger doesn't seem to matter when all you can do is print cash, not create cheeseburgers.

[Martin Hash]

Until there’s not enough cheeseburgers the price will remain the same. That’s the ocean we’re floating on right now.

[Fife]

I see reports of Wall Street buying up single family homes across the country. This is pushing all average folks out of the market. No such thing as a starter home anymore. Unless your upper middle class, you probably can't afford a home.

That's not going to work for very long.

I hear the redditors at Wall Street bets are predicting the economy will crash be the end of the year.

It's almost like there is some coercive agent suppressing the supply of housing that people want and can afford.

Also, when creditors are finally allowed to foreclose and/or evict again, that same sort of coercive agent might REALLY start fucking shit up.

[C-Mag]

I see reports of Wall Street buying up single family homes across the country. This is pushing all average folks out of the market. No such thing as a starter home anymore. Unless your upper middle class, you probably can't afford a home.

That's not going to work for very long.

I hear the redditors at Wall Street bets are predicting the economy will crash be the end of the year.

It's almost like there is some coercive agent suppressing the supply of housing that people want and can afford.

Also, when creditors are finally allowed to foreclose and/or evict again, that same sort of coercive agent might REALLY start fucking shit up.

NO SHIT !

That's the big one few are paying attention too. Correct me if I'm wrong, but for the last year you've not been able to evict or foreclose on anyone. What's going to happen ?

A year ago I would have said that it will end, people will need to pay up or get out, now............. who the fuck knows. Will the government roll the digital printing press and pay off the owners for their missing rents and mortgages ? I think it's possible.

[Fife]

Everyone should be reading based Swede Per Bylund.

The Political Alchemy Called Modern Monetary Theory

udging from Kelton’s presentation, MMT boils down to a description of how the fiat currency system works under a central bank. Kelton explains:

MMT provides an accurate description of how a fiat currency like the US dollar or the British pound actually works. It reminds us that we are no longer on a gold standard, so finding the money to pay for the things we need is never an issue for countries like the US or the UK.

The implication of having a monetary monopoly is that the “[t]he federal government can never run out of money” (all quotes are from Kelton’s talk unless otherwise stated). This is obviously true, but only because Kelton (and MMT) does not distinguish between money in the real sense (the valued medium of exchange, i.e., purchasing power) and the currency issued by government and banks (the dollars or pounds, whether physical or digital). But that’s not always true. For example, the government of Venezuela was not running out of bolívars, but from this it did not follow that the currency would retain its purchasing power (as, obviously, it didn’t) or even retain its status as money (which it also didn’t). Venezuela is one recent example, but the claim is universal. (For more examples, see Zimbabwe/Zimbabwean dollar or the Weimar Republic/papiermark.)