Mike Norman Economics

Payroll tax was a good idea, now scrapped.

Another reversal of position, but this time definitive, coming from the Oval Office.Unfortunately, the Democratic Establishment will probably paint this as 1) an attack on Social Security, which is "funded" by the payroll tax, and 2) a further "blowing out" of the deficit, both of which are nonsense in terms of MMT. Actually, a payroll tax cut would be redistributive, which would bolster the president's support among the middle class, and it would increase the purchasing power of all...

Abstract: Using historical sources, we attempt to unravel and elucidate the economic worldview held by the United States Treasury Department during World War II. We analyze the Treasury’s view of taxation, bond sales, and interest rates. We consider whether and in what ways this worldview is compatible with Modern Monetary Theory, finding that, in most regards, the two align closely, the differences being primarily attributable to the peculiarities of war finance. Finding a less clear view...

In 2017 when a nurse pointed out that her wages had not increased for several years, then-prime minister Theresa May quipped: “There is no magic money tree.” Well, maybe Mrs May was wrong. I believe there is a magic money tree and it is coming to western economies very soon. I am talking about MMT. And strangely, MMT doesn’t stand for “magic money tree”; it’s Modern Monetary Theory.... The question, "Can we trust politicians," is really a question about the viability of democracy. The...

I’d been stewing for a few months in the melange of blogs and YouTube videos and white papers that make up much of the M.M.T. world. Some intricacies lay beyond me—a hazy blur of literature about floating exchange rates and reserve currencies addled my brain. But the basic principle of M.M.T. is seductively simple: governments don’t have to budget like households, worrying about debt, because, unlike households, they can simply print their own money.... This illustrates a major difficulty...

At different times, the manias spread through the world’s financial and economic commentariat. We have had regular predictions that Japan was about to collapse, with a mix of hyperinflation, government insolvency, Bank of Japan negative capital and more. During the GFC, the mainstream economists were out in force predicting accelerating inflation (because of QE and rising fiscal deficits), rising bond yields and government insolvency issues (because of rising deficits and debt ratios) and...

Probably first big post debt ceiling suspension new issues day....Net 20b here 4 week securities:https://www.treasurydirect.gov/instit/annceresult/press/preanre/2019/A_20190813_2.pdf  40b here new issues 8 week securities:https://www.treasurydirect.gov/instit/annceresult/press/preanre/2019/A_20190813_1.pdf  60b total reserve reduction... from these Treasury operations today...

Self descriptive quote from Keynes who I assume was Liberal Art/dialectic trained... this is an interesting way,  as usual via figurative language from these people, to describe how the liberal art trained brain works... probably revealing...They actually think as though they are "changing their mind!" (when they synthesize?); rather than simply making a proper corrective adjustment... weird-o-rama!!! 11/"When the facts change, I change my mind. What do you do, sir?"- apocryphally...

I called that on June 26.

That was quick.Zero HedgeWhite House Denies It Is Considering Payroll Tax Cut To Boost EconomyTyler Durden