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Mike Norman

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.

Articles by Mike Norman

British government designs fiscal policy within a flawed framework – result = poor policy — Bill Mitchell

12 hours ago

This week, the UK Chancellor releases the latest fiscal statement (aka ‘the budget’) and will also have a eye to the general election which must be held before January 28, 2025. One would expect the government would stall the announcement and delay the election for as long as is possible, given the current situation and the cumulative impacts of 12 years of Tory rule, which are plain to see at all levels of British society. All the talk is of tax cuts, that typical ‘sugar hit’ approach to winning votes that soon works it way out of the system. The debate as to what the British government should now be doing is clouded, as these debates are always clouded, by the input of organisations such as the Office of Budget Responsibility, which claims its charter is to “to examine and report on the

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As US Modern Monetary Theory advocates make their case in Australia, Gareth Vaughan explains the world through their lens and how it might go down in New Zealand — Gareth Vaughan

9 days ago

This article, which is favorable to MMT, contains a good explanation of what MMT is and isn’t.interest.co.nzAs US Modern Monetary Theory advocates make their case in Australia, Gareth Vaughan explains the world through their lens and how it might go down in New ZealandGareth VaughanAnother side of the story.[US] Conservatives, [El Salvador’s President Nayib Bukele] said, “always tell me that the problem is high taxes, but they are wrong.”“The real problem is that you pay high taxes only to uphold the illusion that you are funding the government, which you are not,” he claimed, before describing how the government is financed by Treasury bonds, which are purchased by the Federal Reserve with printed money backed by the bonds themselves.“The government is funded by money printing, paper

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Japan sinks into recession – but there is more to the story than the mainstream narrative would care to admit — Bill Mitchell

15 days ago

Last week (February 15, 2024), the Japanese Cabinet Office released the latest national accounts estimates for the December-quarter 2023 – Quarterly Estimates of GDP for Oct.-Dec. 2023 (The First preliminary) – which showed that the economy had slipped into an official recession (two consecutive quarters of negative GDP growth) and in the process had moved from being the third largest economy in the world to become the fourth behind the US, China and Germany. According to the media release – 2023年10~12月期四半期別GDP速報 – the quarterly growth rate was -0.1 per cent (annual -0.4 per cent). Domestic demand was weak, contributing -0.3 per cent while net exports contributed +0.2 per cent. Part of the story is related to a ‘valuation drop’ because the yen has depreciated in recent months, undermining

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The Smith Family manga–Episode 12– the Season 1 finale–is now available — Bill Mitchell

17 days ago

Episode 12 – the finale for Season 1 in our new Manga series – The Smith Family and their Adventures with Money – is now available. We will let everyone calm down from the excitement for a little while to give us time to write and draw Season 2, which will begin on May 24, 2024.In the meantime, have a bit of fun with it and circulate it to those who you think will benefit …William Mitchell — Modern Monetary TheoryThe Smith Family manga – Episode 12 – the Season 1 finale – is now availableBill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

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US inflation rate is declining – no case for further rate rises — Bill Mitchell

19 days ago

The US CPI data released yesterday showed that inflation continues to decline and the so-called ‘surprise’ that seems to have shocked the ‘markets’ are mostly down to the eccentric way the US Bureau of Labor Statistics calculates housing costs. The data provides no justification for further rate hikes in the US or anywhere else for that matter….William Mitchell — Modern Monetary TheoryUS inflation rate is declining – no case for further rate risesBill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

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Why economics is an impossible science — Lars P. Syll

22 days ago

The title might better read, Why orthodox economics is an impossible science. While so-called orthodox economics fits this bill, it doesn’t necessarily apply to so-called heterodox schools like MMT.One of the characteristic criticisms of MMY economists by so-called orthodox economists (like Paul Krugman) is "Where’s your model?" For neoclassical" economists, who assume formalization as a sine qua non of doing economics, required methodological assumptions include "equilibrium and maximization" as Krugman is fond of saying. The post linked to below objects that this not even possible given the attendant conditions, other than as a "toy model" serving as "a teaching tool." Such models cannot underlie a casual explanation of real change in the world of events that economists then assume

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Yi Gang on China’s Digital Yuan — Zichen Wang

23 days ago

Former Central Bank governor lectures on the theories and practices of China’s ambitious central bank digital currency.China appears to be the most ambitious among major economies to develop its central bank digital currency – the digital yuan, and we have covered its development before.On October 10, 2023, Yi Gang, China’s central bank governor between 2018 and 2023 gave a public lecture at Tsinghua University entitled 数字人民币的相关理论与实践 Theories and Practices Related to the Digital Yuan….Almost everything you wanted to know about the digital yuan. PekingnologyYi Gang on China’s Digital YuanZichen Wang

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What is Yi Gang trying to say in his 1st interview after retiring from PBoC? — Zichen Wang

27 days ago

Not about MMT but rather about "money."Today, I am sharing a January 12, 2024 interview of Yi Gang, former Governor of the People’s Bank of China, by 金融时报 Jinrong Shibao (literally Financial Times), a newspaper by the central bank.Yi obtained his Ph.D. in Economics from the University of Illinois Urbana–Champaign and became an Associate Professor with tenure at Indiana University–Purdue University Indianapolis, before going back to Peking University, his alma mater. He later joined the People’s Bank of China and rose through its ranks until heading it between 2018 and 2023.Yi retired in July last year and his five-year tenure at the helm of China’s central bank is known for, according to Bloomberg, “a restrained policy approach focused on moderate stimulus and reducing financial risks in

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Samuelson on the legacy we leave for grandchildren — Richard Murphy

February 3, 2024

Paul Samuelson, the author of what still might be the most-sold textbook of the post-war era had this to say on page 427 of his first edition, addressing a subject then very close to the thoughts of many of his readers:Can it be truthfully said that “internal borrowing shifts the war burden to future generations while taxing places it on the present generation”? A thousand times no! The present generation must still give up resources to produce the munitions hurled at the enemy. In the future, some of our grandchildren will be giving up goods and services to other grandchildren. That is the nub of the matter. The only way in which we can impose a direct burden on the future nation as a whole is by incurring an external debt or by passing along less capital equipment to our

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Bear demoted

February 3, 2024

This guy has been really wrong in hindsight … those that took his advice paid a high opportunity cost…THE BIGGEST BEAR ON WALL STREET HAS FINALLY CAPITULATED MIKE WILSON THE CHIEF STRATEGIST & CHAIR OF MORGAN STANLEY’S GLOBAL INVESTMENT COMMITTEE IS STEPPING DOWN AFTER YEARS OF BEING WRONG & INCOMPETENCEMIKE WILSON HAS BEEN PREDICTING A MAJOR STOCK MARKET CRASH FOR YEARS NOW pic.twitter.com/aLey57rNj5— GURGAVIN (@gurgavin) February 3, 2024

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The Smith Family manga continues–Episode 11 is now available — Bill Mitchell

February 2, 2024

Episode 11 in our new Manga series – The Smith Family and their Adventures with Money – is now available. We are approaching the climax for Season 1. The final episode in the series will be published on February 16, 2024.Have a bit of fun with it and circulate it to those who you think will benefit …William Mitchell — Modern Monetary TheoryThe Smith Family manga continues – Episode 11 is now availableBill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

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Moving to a sustainable system of food production within a degrowth paradigm — Bill Mitchell

February 1, 2024

As the title says, the post is about "moving to a sustainable system of food production within a degrowth paradigm." The basis of the discussion is whether this can take place within the context of "capitalism." Bill argues for the position that it cannot. I have set for reasons previously explaining my agreement with this view. A major reason can be summarized as "perverse incentives." Of course, it is more complicated than that but the rubric "perverse incentives" sums up Marx’s notion of internal contradictions inherent in the capitalism system.However, even granting a critique of capitalism, the fundamental question remains unanswered, namely, how does global production get from here to there. Without specifying a potentially fruitful route the project remains utopian. Bill proposes

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Will the Hegemon Ever Accept a New Westphalian World Order? Pepe Escobar

February 1, 2024

Pepe Escobar reviews Prof. Glenn Diesen’s new book, The Ukraine War & The Eurasian World Order. Escobar recently reviewed Emmanuel Todd’s La Défaite de L’Occident (“The Defeat of the West”).The reviews are short and present views that suggest the world order is changing not only politically but also economically as a result of decolonization. This emerging trend portends to grow the pie for all albeit not without growing pains as the dominant parties attempt to maintain their hegemony.Strategic Culture Foundation (sanctioned by the US Treasury Department)Will the Hegemon Ever Accept a New Westphalian World Order?Pepe EscobarIf this site is blocked for you, try Global South here and here.

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China is ‘world’s sole manufacturing superpower’, with 35% of global output — Ben Norton

January 31, 2024

China’s state-led economic development model and robust industrial policy has transformed it into what an influential European think tank calls “the world’s sole manufacturing superpower”, making up 35% of global gross production – more than the 9 next largest manufacturers combined.…China has overseen world-historic economic growth through a government-led development model, in which state-owned enterprises control the natural monopolies and “commanding heights” of the economy, state-owned banks give favorable loans to strategic industries, and the state’s robust industrial policy helps the country move up the value chain toward higher value-added forms of production.Geopolitical EconomyChina is ‘world’s sole manufacturing superpower’, with 35% of global outputBen Norton See

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Wishful thinking

January 30, 2024

It’s wishful thinking to think it’s being driven by wishful thinking…The EU’s idea of the reform of the fiscal framework is unworkable in practice. It will lead to recession and crises and higher public deficits and debts. Instead of building the reform on hard science (incl. accounting & empirical observation), it is driven by wishful thinking.— Dirk Ehnts (@DEhnts) January 30, 2024 It’s being driven by a type of academic practice that doesn’t exist in the “hard sciences “…

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Anything we can actually do, we can afford — Bill Mitchell

January 29, 2024

I often make the point in talks that the fictional world that mainstream economists promote leads to poor decisions in the real world by our policy makers. We saw that in the 1980s and 1990s with the large scale privatisations of public enterprises, touted as employment-enriching, productivity-boosting strategies to provide ‘more money for government to spend on welfare’. We now have enough data to know that in almost all the examples the promises have not been fulfilled and the outcomes worse than what would have been had the enterprises been maintained in the public sector and motivated to provide public service rather than private profit. The same mistake is being made with the response to the climate emergency. Economists and commentators are claiming we need to ‘repeat the

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Lower British fiscal deficit gives the central government no more or no less capacity to net spend to reduce unemployment — Bill Mitchell

January 25, 2024

Today, I reflect on the latest public finance data released by the British Office of National Statistics which shows the fiscal deficit is smaller than expected. Even progressive journalists have written this up as providing more scope for pre-election largesse to be provided. The fact that the fiscal balance is lower provides no more or no less scope for the government to net spend. The relevant questions that should be answered before such an assessment can be made are ignored by the journalists, including the fact that the unemployment rate is rising and the supply-driven inflation is falling fast.William Mitchell — Modern Monetary TheoryLower British fiscal deficit gives the central government no more or no less capacity to net spend to reduce unemploymentBill Mitchell | Professor in

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Civil society is in jeopardy in the UK as funding cuts erode local government capacity — Bill Mitchell

January 22, 2024

I keep hearing from friends who live in Britain that I will be shocked when I get there on Thursday of this week after a nearly four year absence. One friend, who has just returned said that the deterioration in the public infrastructure is now fairly evident. Despite my absence, I have been keeping a regular eye on the data and so these anecdotal reports and reflections come as no surprise. It is obvious that the Tory government has sought a depoliticisation strategy by cutting local government spending capacity as a way of diverting blame for the consequences of their austerity push. The problem now is that after 13 or so years of Tory rule, the cuts are eating into the very essence of civil society in Britain. Like all these neoliberal motivated cuts, the cuts to council grants will

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Russia And Iran Finalize 20-Year Deal That Will Change The Middle East Forever — Simon Watkins

January 22, 2024

Iran’s Supreme Leader Ayatollah Khamenei gave his official approval to a new 20-year comprehensive cooperation deal between the Islamic Republic of Iran and Russia.The agreement will replace the 10-year-deal signed in March 2001 and has been expanded not only in duration but also in scope and scale.The new deal includes far-going agreements on defense and energy.Iran previously concluded extensive trade deals with China, as well as a "strategic partnership." Iran is also approved for membership in BRICS, SCO and BRI.Oilprice.comRussia And Iran Finalize 20-Year Deal That Will Change The Middle East ForeverSimon Watkins

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QT

January 20, 2024

We can’t forget this QT is still happening in the background too… in view of S&Ps recovering back to a old 2 year high this week…Fed steadily keeps working this balance down and it at least takes some reserve asset pressure off “money center” banks that have ample/excess reserves… This “unprinting money!” is supposed to be bearish according to monetarists… yet equity index values are currently back to all time highs after a 2 year hiatus…Concomitant the daily RRP sub-account is being reduced… daily RRP account balance is down to $600B having been $2.3T a year ago …. but still any non zero RRP balance means reserve assets are flowing towards banks that don’t have the regulatory capital to posses them and accordingly have to figure out how to divert them or otherwise apply reduced values to

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Stephanie Kelton Thinks the Conventional Wisdom Is Changing — Jacobin’s Lukas Scholle interviews Stephanie Kelton

January 19, 2024

Economist Stephanie Kelton has made a name for herself by insisting that deficits don’t matter. In an interview with Jacobin, she argues that we’re seeing a paradigm shift away from free-market dogmas and austerity.JacobinStephanie Kelton Thinks the Conventional Wisdom Is ChangingLukas Scholle interviews Stephanie Kelton, professor of public policy and economics at Stony Brook University,

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Michael Hudson on the state of the world

January 19, 2024

Danny Haiphong interviews Micheal Hudson. Video and transcript.Michael Hudson — On Finance, Real Estate And The Powers Of NeoliberalismCredit the Economic PlannerMichael Hudson | President of The Institute for the Study of Long-Term Economic Trends (ISLET), a Wall Street Financial Analyst, Distinguished Research Professor of Economics at the University of Missouri, Kansas City, and Guest Professor at Peking UniversityIndia and Global Left interviews Michael Hudson. Video and transcript.India and Global LeftPerfecting ImperialismMichael Hudson | President of The Institute for the Study of Long-Term Economic Trends (ISLET), a Wall Street Financial Analyst, Distinguished Research Professor of Economics at the University of Missouri, Kansas City, and Guest Professor at Peking University

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