Monday, 12 December 2011

MMT and Positive Money ideas in the Financial Times.

Letter in today’s Financial Times which is very much in line with Modern MonetaryTheory (MMT) and Positive Money’s ideas, namely that in a recession the government / central bank machine should simply create new money and spend it into the economy (and/or cut taxes).

The letter goes off the rails at one or two points, I think, but it’s good to see MMT and Pos Mon ideas out there.

In contrast to the above ideas, the authorities’ response to a credit crunch brought about by excessive and irresponsible borrowing was to cut interest rates and implement QE so as to encourage more borrowing. You couldn’t make it up, could you?


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