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Their arguments and attacks are so weak, it's comical. Trade and invest using the concepts of MMT. Get a 30-day free trial to MMT Trader. https://www.mmteconomics.com/ Mike Norman Twitter https://twitter.com/mikenorman Mike Norman Economics: https://mikenormaneconomics.blogspot.com/ Understanding the Daily Treasury Statement video course. https://www.pitbulleconomics.com/understanding-daily-treasury-statement-video-course/?s2-ssl=yes
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Their arguments and attacks are so weak, it's comical. Trade and invest using the concepts of MMT. Get a 30-day free trial to MMT Trader. https://www.mmteconomics.com/ Mike Norman Twitter https://twitter.com/mikenorman Mike Norman Economics: https://mikenormaneconomics.blogspot.com/ Understanding the Daily Treasury Statement video course. https://www.pitbulleconomics.com/understanding-daily-treasury-statement-video-course/?s2-ssl=yes
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Lars Pålsson Syll writes Cutting-edge macroeconomics …
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| Their arguments and attacks are so weak, it's comical. Trade and invest using the concepts of MMT. Get a 30-day free trial to MMT Trader. https://www.mmteconomics.com/ Mike Norman Twitter https://twitter.com/mikenorman Mike Norman Economics: https://mikenormaneconomics.blogspot.com/ Understanding the Daily Treasury Statement video course. https://www.pitbulleconomics.com/understanding-daily-treasury-statement-video-course/?s2-ssl=yes |
I need stiff drink lol
Ronald Reagan, (the Actor) became president and began the 40 year ruin and downhill ride of this country! Now, it’s second nature to every talking head on TV, if wages rise, it is considered bad news. NO other civilization does this. Tell me how bad are the economics curriculums @Harvard again? In this paradigm, the most important is “Inflation”! FUCK the working guy. Forget the fact C-Suites were making 1000x the regular workers for over 40 years under the guise of Milton Freedman economics beginning in the 80’s under the worst president ever, Ronald Regan. Fast forward to now, finally, the minute the wages start to creep up, all of the sudden the world is going to end and boost rates. And who does that help? yup! The SAVERS; Those who HAVE the most already. This country’s politicians, especially the Republican party for the most part is completely in the pockets of the corporations and literally run by illiterate morons.
Interest rate hikes only help the rich. No one average benefits from $200 boost in interest income a year. That said, I do agree with Mike that eventually the interest will hit the markets soon or later. I think we are looking at something like 80’s economy if the FED keep raising rates.
They use the 18,000 job layoffs but from 2020 to 2022 Amazon added multiples more jobs.
I like the analogy of how MMT is like in biological science. It’s not a prescription that tells a doctor what to do. It just explains to the doctor what happens if he prescribes something.
MMT is a lens/ description of how federal spending works.
MMT does not write the policies.
Congress writes the bills per the oligarchs.
The oligarchy owns the government because they understand that TAXES never fund spending at the federal level… but the citizens should be afraid of the deficit???!!!!!
‘MMT isn’t a policy, it’s a description’ is a nice succinct way of putting it.
Because unfortunately most people think ‘MMT is a policy which says you should just print money’ (aaaaaaaaarrrrrrrggggggghhhhh)
When I hear this, it’s just a red rag to a bull of course. So maybe the best first response is, it’s a description not a policy, which will lead to a discussion what MMT describes.
IE the stuff you talk about every day on your show.
We should not fear higher interest rates.
I'm not against lower stock prices, because it creates opportunities.
I appreciate your insights and by your system/logic, I would agree that the market should tend to go higher. I'm with you on higher rates being a stimulus.
That being said, I don't think your approach accounts for all risks, which are numerous. The risk of an escalation of war being one of those.
I think you mischaracterized the object in the pool, Mike. The monetarists in the pool are just a big hulking turd. Not a car.
The monotists have called 20 of the 5 recessions you think they would change there methodology. isn't that the definition of crazy?
the "church" of MMT
Higher interest rates are a problem, since I don't believe the income from e.g. treasuries makes a difference to workers, since working and middle class people do NOT hold the lion's share of treasuries; rich individual investors, financial institutions (especially banks), mutual funds and rich foreign investors have like 95% of all treasuries, i.e. a bunch of rich people being paid for being rich; there is some gain since workers, of course, have pension funds. However, EVERYONE benefits from low-interest rates, since workers save more money under low rates than they earn when rates are higher. Moreover, higher rates actually reduce total outstanding loans; people borrow less when rates are higher, which has a deleterious effect on the money supply (it shrinks, since credit doesn't circulate much before being destroyed, as opposed to cash and fiscal spending). If you want low inflation, more private investment (business loans), then part of that equation is low interest rates.
The distribution of income may seem inequitable to you (which I would agree with), but aggregate income in the economy increases, and that boosts the economy, which should make things at least somewhat better for most. As an economist/investor, I look at things in the aggregate. Would these be the policies I would apply? Not necessarily, but I am not in charge. I want to invest and make money.
@Mike Norman MMT Economics
But sales from working and middle-class people drives the economy. The rich do not create enough demand across all sectors for large widespread gains, but only the proprietors of luxury goods and expensive services, since these are the people indirectly receiving the extra income from increases in interest rates, not workers (you referenced it yourself by discussing the rise of Bernard Arnault as now the richest man in the world).
We might not have a recession in 2023, but there is a recession in wages (few are getting an 8% wage rise to meet CPI) and so I expect SME’s to struggle.
I think part of the reason we can’t use fundamentals to the extent that it was possible in the 60s 70s and 80s in gauging equity prices is they have diverged from fundamentals, I think, precisely because workers aren’t spending enough to make white elephants like tesla, profitable; yet they’ll continue to command high equity values based on investor confidence, rather than sales (hoping for a future where workers actually can support these high valuations with sales). We know productivity and wages were decoupled in the 80s and are diverging at greater rates every decade. This is all reflected in free online data
I think the point about rate hikes and the income flows they generate, needs a caveat. It not just about fiscal expansion per se but who exactly is benefiting from these very specific income flows? My mortgage has gone up by £500 pm in the last 12 months. That's £6000pa I can't spend into the economy and £6000 of extra revenue for my mortgage lender. I don't benefit from interest rate hikes as I don't hold any Government Bonds and I don't know any Joe Public who hold enough Govt Bonds, to see higher prices offset by enough coupon payments every 6 months.
As you said yesterday, if you take money out of the economy you could cause a recession, if my spending in the real economy is reduced, along with millions of others through rate hikes, you in effect create the same conditions for a recession.
So, me personally, I do fear rate hikes.
MMT is simply an accounting of fiscal flows … a description … everyone here gets it. BUT, its thesis IS policy when the government must always be running a deficit to support a nation that has NO personal savings while INCREASING household debt prevents growth. I’ve said this on this channel multiple times that the fed will not pivot until it meets the 3 things it clearly stated in November 2021: 1) unemployment must increase and wage growth must decrease, 2) aggregate demand slows to neutral, and 3) YOY inflation is around 2%. And your both wrong and right, increased government spending will continue to fuel inflation… 2022 proves that! That fiscal inflow voted into the economy by .gove (MMT) is working against the fed and the fed is pissed off. The mental game here is knowing that the fed’s jawboning WORKS and it will continue to raise interest rates until the system cracks and the above 3 points are met. Only then will the fed back off. Good luck fighting the fed!
Great content Mike!
The markets are a giant hoax run by satanists. No joke.
Mike can you please comment how it's possible for the indices to be up almost 3% and the majority of stocks are underperforming the indices with many red or barely green?
why would you think this fools knows anything about this when he can't even see how his mmt thesis wrt trading stock is broken. It fails any mathematical test you can throw at it. If he had any clue or any honesty he'd tell you he was wrong.
Anyway, the answer is simply that the market is not equal weighted. I have no idea what garbage you own but i know Mike loves to buy gutter stocks. They could be deep red yet the index would not even feel it because real stocks with real earnings were up huge today.
Mike is a clown.
Develop success from failures. Discouragement and failure are two of the surest stepping stones to success. ~Dale Carnegie
I too tight rising interest rates are bad. I need to go back and study that part.