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Welcome to the age of Modern Monetary Theory: It’s turning conventional economics upside down — Andew Kordik

Summary:
Naturally, politicians and pundits debate whether the amount is excessive. But implicit in their seemingly routine deficit debate is a remarkable shift: Inflation has replaced debt — the old stalking horse for defeating progressive legislation — as the primary concern with deficit spending.It's a subtle change, with profound consequences. And it augurs the rise of a revolutionary approach to political economy, Modern Monetary Theory (MMT), as the dominant paradigm in the politics of money.Like Keynesians of yesteryear, Modern Monetary Theorists urge government to achieve full employment through fiscal policy, even when it requires deficit spending. Their comfort with large deficits emerges from an understanding that an obsession with national debt is a relic of another time, the age of

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Naturally, politicians and pundits debate whether the amount is excessive. But implicit in their seemingly routine deficit debate is a remarkable shift: Inflation has replaced debt — the old stalking horse for defeating progressive legislation — as the primary concern with deficit spending.

It's a subtle change, with profound consequences. And it augurs the rise of a revolutionary approach to political economy, Modern Monetary Theory (MMT), as the dominant paradigm in the politics of money.

Like Keynesians of yesteryear, Modern Monetary Theorists urge government to achieve full employment through fiscal policy, even when it requires deficit spending. Their comfort with large deficits emerges from an understanding that an obsession with national debt is a relic of another time, the age of gold standards and fixed currency arrangements. Today, in the age of national monetary sovereignty and free-floating currencies, countries like the United States can fulfill all financial obligations with a simple keystroke....

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Welcome to the age of Modern Monetary Theory: It's turning conventional economics upside down
Andew Kordik

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Business and finance should be happy. Net spending accruing from fiscal deficits flows to profits.

Are these windfall profits that should be subject to taxation?


Mike Norman
Mike Norman is an economist and veteran trader whose career has spanned over 30 years on Wall Street. He is a former member and trader on the CME, NYMEX, COMEX and NYFE and he managed money for one of the largest hedge funds and ran a prop trading desk for Credit Suisse.

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