Honest opinions - freely given
I am afraid that it is an unusable mess on my iPad now. Needs a way to view it in the non-"optimised" (ie actually functional) version.
Works fine on mine, as it picks up the mobile version, which is just a swipeable list.
Hi Neil,Do you know whether the Maastrict Treaty (article 104) makes it illegal for the UK government to borrow directly from the BoE/ use the "ways and means" account/ finance deficit spending through direct money creation? Or does the article only apply to eurozone member states?ARTICLE 104:1. Overdraft facilities or any other type of credit facility with the ECB or with thecentral banks of the Member States (hereinafter referred to as ‘national central banks’) in favour of Community institutions or bodies, central governments, regional, local or other public authorities, other bodies governed by public law, or public undertakings of Member States shall be prohibited, as shall the purchase directly from them by the ECB or national central banks of debt instruments.
Illegality is a matter of enforcement. The enforcement in this case appears to be that the findings of the European Council report would be made public. Similarly Article 126 States that government deficits should not be excessive and government deficit to GDP ratio should be below a certain size.The welfare of the population is of more importance than the European neo-liberal bureaucracy. If it gets in the way, it should be discarded.
So is there no other penalty for ignoring article 104, other than that an EC report would be made public?
What are they going to do? Send in the tanks they don't have? What have they done with the countries that have persistently exceeded the deficit targets? Countries like Germany and France?The EU treaties are a bit like the Code of the Pirate Brethren. Not so much rules as guidelines.What do you think the EU trying to stop a Job Guarantee in the UK using this mechanism would do to UK public opinion regarding the EU?
Like the new layout, but can no longer see the sectoral balances graphs, on chrome, firefox or opera.Huge respect for what you're doing here.
Yep, those are broke. Back out time then!
Neil, Like the new layout, especially 'Popular Posts'. I know you are critical of of Positive Money's analysis of where money comes from and how the system works. On the other hand MMT seems to have no think tank/academic profile here in the UK, yet they have the blessing of NEF (New Economics Foundation) and Prof. Richard Werner at Southampton University. Any chance of a not-too-technical post explaining where they are going wrong?
It's on the list of things to do. But it's a tough one to write to be understandable.However the main problem positive money have is what I call The Watchtower problem. They believe something fervently (essentially that there is a One True Money) and therefore everything always ends up trying to prove that.Which means that the explanations drift into propaganda (video 4 in BANKING101 being a case in point), and they miss the obvious issues (that banks always create money whether you use an in specie system or a insured system of accounting).If you look at their proposed legislation, note how many 'off balance sheet' requirements there are to make the accounting fit the world view.
After asking the question, it so happened I read Ann Pettifor's recent review of Geoffrey Ingham’s book 'Capitalism', in which she criticised NEF for falling for the ‘fractional reserve banking’ myth. She also took issue with NEF's Josh Ryan-Collins for proposing a banking solution based on the monetarist ideas of the Chicago School.Perhaps I'm wrong, but Ann's thinking seems fairly close to the MMT model (well she at least sometimes retweets Stephanie Kelton!). http://www.primeeconomics.org/wp-content/uploads/2013/01/The-power-to-create-money-out-of-thin-air5.pdf
Neil, Forgot to say thanks for replying. To keep it simple, how about just addressing Positive Money's claim that 97% of UK money is created by private banks?
Stephen, the money created by private banks is through making loans, the bulk of which are to business for investment in capital goods and commercial real estate. The next large swath is residential real estate and a small portion consumer credit. All this involves risk management. Govt gives the banks a franchise to partner in money creation in exchange for doing the risk management while accepting oversight and regulation. A lot of people think that his is a better way to go about allocating funds than govt choosing the winners and losers based on political forces and patronage. There are arguments on both sides, private sector and govt, and the challenge is to come up with a system that avoids government picking winners and losers based on politics and the private sector creating booms and bust through financial cycles. As always, the question boils down to optimizing growth, employment and price stability, which implies reducing govt involvement to the degree it introduces inefficiency and preventing the private sector from extracting rents. So it is not simply a matter of addressing the banking system but how that impacts the economy and society. So I think that this has to be looked at in a comprehensive way wrt systems design based on desired outcomes overall.
"To keep it simple, how about just addressing Positive Money's claim that 97% of UK money is created by private banks?"That would be to accept their frame of reference. The Campaign for Yellow Cars has a similar claim: 97% of cars in the UK are created non-yellow.The response from everybody other than True Believers is the same - a shrug of the shoulders. So what.These 'Profound Statements' are central to any propaganda push.But really they are a statement of belief, not of anything substantial.
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