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Henry Ford understood the value of paying high wages. He also understood that supporting the buying power of workers helped his business and all businesses in the economy. Trade and invest using the concepts of MMT. Get a 30-day free trial to MMT Trader. https://www.pitbulleconomics.com/ Download my podcasts! New one every week. https://www.buzzsprout.com/1105286 Mike Norman Twitter https://twitter.com/mikenorman
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Henry Ford understood the value of paying high wages. He also understood that supporting the buying power of workers helped his business and all businesses in the economy. Trade and invest using the concepts of MMT. Get a 30-day free trial to MMT Trader. https://www.pitbulleconomics.com/ Download my podcasts! New one every week. https://www.buzzsprout.com/1105286 Mike Norman Twitter https://twitter.com/mikenorman
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| Henry Ford understood the value of paying high wages. He also understood that supporting the buying power of workers helped his business and all businesses in the economy. Trade and invest using the concepts of MMT. Get a 30-day free trial to MMT Trader. https://www.pitbulleconomics.com/ Download my podcasts! New one every week. https://www.buzzsprout.com/1105286 Mike Norman Twitter https://twitter.com/mikenorman |
right wing economics = depopulation. child birthrates all time low in the USA and world.
They want all the resources for themselves no matter how many they have to kill through bad economics
Henry Ford may have paid his workers a good wage, but it wasn't out of charity — it was a good business decision that some say helped the middle class take off. He says Ford proved that higher wages led to more productivity, which in turn was good for business
I don't think Mike was making a charity argument. He's been saying it'd be good for business for a while now.
Look up Dan Price.
His workers required some training and so to make them stay to avoid the cost of re-training, he paid them more. He probably would not pay his cleaning lady any more than market price.
If you know better you can demand a better listen to what Mike is saying learn mmt please
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on Today's show Mike Norman explains why the ghost of Henry Ford told him to buy a Chevy Camaro ZL1 over a Ford Mustang Shelby GT 350 in a mystic dream , at first Mike was like but Mr. Ford I really want a Ford Rustang….hahahaha…
Thanks for your perspective and information all these years Mike. I was in before you had a thousand subscribers and it's been fun to watch MMT truth spread and your channel grow since. I have a question related to this video and your analysis generally. When does the extreme bifurcation/inequality pose a threat to the economy and markets by itself? Can low interest rates/taxes combined with fiscal support and credit provide enough demand forever?
MMT wrongly assumes the government creates money. In fact, ALL money is created when private banks issue loans. And the Federal Reserve is privately-owned by banks, NOT government. If MMT professors get these basic facts wrong, why would you trust their analysis that follows from an incorrect premise?
@Wide Hotep Something can be owned by one group of people while being controlled by another…
@I. K. Possibly. If someone loans or rents their property you would be right. But why would the government pay hundreds of billions of dollars of interest payments annually to borrow something they already own? That would be like you PAYING ME to borrow your car! And why is there a $30 trillion national debt if the government can simply create their own money?
@Wide Hotep Ok, so do we have to pay that debt and when? What country has payed back its national debt, and what did it accomplish? You may say the current system favors financial institutions, and I couldn't agree more. But would you trust politicians to make all the financial decisions? It seems logical that financial policy is set through balancing short-term political goals and long-term strategies based on current economic theory.
@I. K. You are digging into the weeds and trying to discuss implications, consequences, and possible motivations. My original point is this: MMT people WRONGLY state that government creates all money. This is COMPLETELY wrong, and therefore the MMT crowd has proven themselves to be unaware of basic economic truth.
The truth is that all money is created by banks when they issue loans. Banks collect TRILLIONS of dollars every year in interest payments for loaning something they never had to begin with. Lives and families are ruined for defaulting on these loans. It is 100% impossible for everyone to get out of debt. The public schools, colleges, and mainstream media keep all of this hidden from us. And the MMT people are guilty of this crime: they are smart, and should know better.
To be fair, the MMT people have other things 100% right, such as chartalism. They changed my mind about market-derived money.
So true
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Super talk. Please talk more on how MMT will save America.
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"It is well that the people of the nation do not understand our banking
and monetary system, for if they did, I believe there would be a
revolution before tomorrow morning.”
Henry Ford
Mike Norman and the MMT crowd DO NOT understand the banking system. They wrongly think the government creates all money, when in fact ALL money is created when private banks issue loans.
@Wide Hotep Banks DO create money when they issue loans beyond their required reserves. But, you're only thinking of one step of one the process. Who determines the amount of reserve? The currency issuer.
@Annie Zannetti You are wrong on many points. First, banks create money out of thin air when they issue loans regardless of reserves. Presently, the reserve requirements for American banks have been lowered to ZERO, yet banks are issuing loans like crazy. The myth that lending is limited by reserves is called "The Money Multiplier Myth" and I encourage you to google it. In real life, Banks add reserves AFTER money is created via bank loans (based on the previous 30 days records). These "reserves" are deposited with the bank-owned Federal Reserve to support the Fed's intra-bank check clearing system, NOT as a base or limitation for loan issuance.
And to answer your question, WHO DETERMINES THE RESERVE REQUIREMENTS? Not the government. The Federal Reserve is privately-owned by banks, and they self-regulate themselves with no government input. Even former Fed chairman Ben Bernanke admitted that the Fed operates completely independently from government.
Finally, the Government doesn't issue any currency whatsoever. It is true that the US Treasury makes the paper notes and metal coins, but these are sold to the bank-owned Federal Reserve for the cost of production (less than twenty cents for a $100 note). And only private banks issue this physical money into circulation, NEVER the government. The government gets all revenue from taxation and borrowing. If the government created money as needed, there would be no need for borrowing, and there would be no $30 trillion national debt.
Perhaps now you understand why 95% of all "money" in our system exists only in the computers of privately-owned banks. The US Government gave away control of money to private banks in 1913, and the banks took total control in 1933.
@Wide HotepLending by Private banks creates an equal debt for a net total of 0. You are correct that no borrowing is required for Federal Government spending. The Fed is independent of the Government but cannot credit accounts except by permission of the US Congress, ditto for the Treasury. Literally nothing in your comment invalidates MMT in the slightest.
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Here in the Netherlands for 300 (euro) a week I could pay off my mortgage (750), pay the electrical bill (120), health insurance (130), internet and mobile (50)… Actually my health insurance is nearly free since I get around 110 refunded every month. So I would be left with 260 every month for food and clothing. As I only buy second hand clothes, I could easily manage that. I could live off of 300 a week and still half of that would go straight to my own pocket as mortgage pay off !!
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Keep up the good work, Mike. It does feel a bit like we advocates of fact AKA MMT are members of a cult but this cult is about fact and not opinion. As Ghandi said, 'First they ignore you, then they laugh at you… Feels like MMT is at stage 3 of 4 and fact/victory is near but the establishment stand to have their Ponzi scheme upturned will fight and fight. Don't expect this to be a simple war to change the narrative but it's war worth fighting.
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@Meet Kevín – That wasn't meant to sound like criticism as it wasn't. I have listened to you for about 4 years now and always get criticised for speaking about MMT this side of the pond like I am some crazy lunatic. As an engineer, I know the mathematics but don't always get all of the concepts immediately so forgive me. I spend my time writing AI algorithms for my day job but study this or fun and truth believe it or not…and it beats watching TV this side of the pond. Maybe I phrased my point incorrectly but it was meant to be supportive, sorry if it caused offence, it wasn't intended. You are a lone voice but one of truth in a very, very strange world at present. Good look on your hike too.
Do you realise there is something not right with your site?
The DNS A record is going to either the wrong server or you've had a breach
@Meet Kevín – Your responses are the same and your site has been breached Mike. The WHOIS records look relevant but there are issues for sure Mike. You probably already know.
It's quite simple really. Suck all the money to the top, it stops moving around so much, stagnates, doing nothing. Sending it to the bottom, deflating giant money balloons and having money flow everywhere, keeps a healthy circulation.
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Nice one Mike. https://mikenormaneconomics.blogspot.com/2021/05/ford-on-wages-neilw.html
Please look at the CNN news on inflation but nothing about the fact that infrastructure plans will increase the production capacity to decrease the inflation: https://amp.cnn.com/cnn/2021/05/09/investing/stocks-week-ahead/index.html
Cyber wars alive and well, East Coast got the colonial pipeline shut down for ransomware, gasoline pipeline texas to NY area kaput.
Common ground dump the trickle down.
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Ford loved Hitler.
Mike you make life a better place for me with you commentary thank you.
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Hi. Have you seen this odd response has been used for many replies? I had the same and it's not like Mike to comment really. Something is fishy.
@harperonline did not follow up on that response I think it is a hack.
@merchantsailor Are you on about the comments or the website now? The domain was routing me to 'winning an Iphone for the 5 billionth search' until about 10PM GMT when the issue went away. I told Mike about it. May have been DNS poisoning as it was sporadic but the YouTube comments were really, really odd.
"quality product"?
you should do some updates.
In the lamp business, a cartel was formed over a century ago, in order to prevent a "quality product".
credit to the video: "why we can't have nice things".
Ever wondered why no cars from stainless steel?
Was also a video on this, forgot its title.
Only in the PC business, Dell and Intel are/were the last to create quality products, and they are the exeptions, AFAIK, with the caveat of the back doors/zero day vulnerabilities, which every hardware producer puts in their respective products.
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Quoting directly from the article: Henry Ford said:"Country-wide high wages spell country-wide prosperity, provided, however, the higher wages are paid for higher production."
Henry Ford understood the relationship between productivity and wages. Higher productivity = higher wages, in other words, a person digging with a shovel should be paid more than a person digging with a teaspoon.
This is a concept that Henry Ford and the Austrian Economists understand. They also understand the BIG difference between private corporations deciding to pay higher wages for more productive workers Vs the Government arbitrarily raising the minimum wage and paying out welfare.
Quoting directly from the article: Henry Ford said: "Paying high wages and lowering production is starting down the incline toward dull business."
Paying people to sit at home and do nothing is the equivalent of paying higher wages and lowering production.
The bottom line: If you want to earn more, you must produce more. This doesn't happen by the Government handing out FREE money or arbitrarily raising the minimum wage. It happens through innovation, training, education, hard work and determination.
Like this true story from a young man on YouTube who went from a minimum wage job to starting his own business.
http://www.youtube.com/watch?v=eEO6jgVWkZU
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Henry Ford's workers required some special training and so to make them stay to avoid the cost of re-training, he paid them more. He probably would not pay his cleaning lady any more than market price.