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Title: Randy Wray: Helicopter Ben – How Modern Money Theory Responds to Hyperinflation Hyperventilators
Source:
Naked Capitalism
URL Source: http://www.nakedcapitalism.com/2011 ... nflation-hyperventilators.html
Published: Sep 7, 2011
Author: L. Randall Wray
Post Date: 2011-09-08 00:24:07 by lucysmom
Keywords: None
Views: 8781
Comments: 23
In the first part of this series on hyperinflation I addressed the critic’s view that if Modern Monetary Theory were adopted, this would inevitably lead to hyperinflation. I argued that this is obviously false—MMT describes how any sovereign government that issues its own currency spends. They’ve all done it for the past “4000 years at least” as Keynes put it. All modern sovereign governments spend by “keystrokes”—making electronic entries onto balance sheets—what most critics somewhat misleadingly call “printing money”. There is no other way to spend a sovereign currency into existence. Only the sovereign government can create it. If you try to create US currency in your basement, you go to jail. In the second part, I argued that hyperinflation is a rare occurrence. Obviously, if “keystrokes” inevitably lead to hyperinflation, then hyperinflation ought to be a common feature of just about all economies for the past 4000 years. Instead, we find that experience with hyperinflation is quite limited, and seems to result from very specific circumstances such as unwillingness or inability to impose and collect taxes, with civil war, or with huge external debts denominated in a foreign currency. And while goldbugs and others think that tying a currency to gold (or to a foreign currency) is a sure-fire way to avoid inflation, what we actually observe in the real world is that such systems are inherently unstable and rarely last long before they crash—often with an exchange rate crisis and high or hyper-inflation. In this final part of the series I will address the belief that the US (and other countries with large budget deficits in their own floating rate currency) faces hyperinflation. Many fear that “Helicopter Ben” (Chairman Bernanke) has pumped so much “money” into the economy that high inflation, if not hyperinflation, will be the inevitable result. This is one of the reasons for the run into gold—supposedly an inflation hedge.
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#1. To: A K A Stone, Fred Mertz, Godwinson, go65, war, no gnu taxes, Skip Intro, ferret mike, jwpegler, mininggold, brian s, mcgowanjm (#0)
"...all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being." Sandeep Jaitly
the prospects for inflation have not been smaller since 1930. Pay this guy a 1930 wage, and then maybe he'll be able to figure out that inflation is real.
Obama's watch stopped on 24 May 2008, but he's been too busy smoking crack to notice.
So they should make us all millionaires. It should just take a few keystrokes. Er no billionaires, I want to be a billionaire. I want all my friends and neighbors to be billionaires too. Hmm....on third thought it would be nice to be a trillionaire. We should all be trillionaires. Even the people on welfare.
Republicons are working on it.
"...all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being." Sandeep Jaitly
Go for it! All you need to do is become a bank and have an account with the Federal Reserve.
"...all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being." Sandeep Jaitly
No. Your guy hellbama should order them to make us all trillionaires. It wont cause any inflation.
Republicons are working on it. Everyone in the Imperial City/Wall St is working on it. Success is assured.
$1.5 Trillion in debt derivatives. Maybe $6 Trillion in actual paper. Maybe $1.2 Trillion in actual gold. The Match up gives you $50 the acre land.
Oil imports into the U.S. would drop from 9 million barrels a day (BPD) to zero, a decline which would crush the price of oil on the world market, bankrupting the exporters who depend on high prices to fund their domestic stability.
Frontline, the World's Largest Oil Shipper going BK as I type. You can't ship oil, you can't ship anything.
I "pinged" Boofer for you LM...
America...My Kind Of Place... "I truly am not that concerned about [bin Laden]..." "THE MILITIA IS COMING!!! THE MILITIA IS COMING!!!" I lurk to see if someone other than Myst or Pookie posts anything...
He thanked you, right?
"...all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being." Sandeep Jaitly
Chuckles...
America...My Kind Of Place... "I truly am not that concerned about [bin Laden]..." "THE MILITIA IS COMING!!! THE MILITIA IS COMING!!!" I lurk to see if someone other than Myst or Pookie posts anything...
The political turmoil in the Middle East, W. Europe and N.Africa are largely due to inflation. WHY? Because the prices for consummables that people need to survive, is going up dramatically. In the M.E., for example, food prices have gone up (by last report) about 40%, from this time last year. Where most people over there have a subsistence living, basically living from hand-to-mouth, they used to be able to barely afford two meals a day. Now they can only afford ONE. THIS is why the rest of the world is going up in flames... We see similar effects here. My food bills have gone up ~30% in the last year. Gasoline? Same. Misc. expenses that are required for little kids (diapers, baby-wipes, etc) are the same. Do NOT make the demonstrably false claim that we don't have inflation already. Do NOT cite demonstrably false government statistics to me, in the hope that I'll be so stupid as to believe them. As a final note on the quote above, gold is now approaching $2000/oz. WHY? People don't make a "profit" on physical gold, only on paper ETF bets. People, banks and countries are ALL accelerating their purchases of physical silver and gold... Not because they expect to make a "profit," but because they're interested in maintaining the purchasing power of the money they've saved thus far... Only a fool buys physical gold or silver, with the idea of making a profit. Gold is the barometer, showing how devalued the dollar really is... It's THE standard by which all fiat currencies are measured. This Randy Wray is an out-and-out "progressive," i.e. SOCIALIST. A quick look at his writings and his associations makes that all too clear... And you have to be a idiot to be both a SOCIALIST and an economist. One cannot have a firm understanding of economics AND believe in SOCIALISM, because a real understanding of economics must lead one to the logical conclusion that SOCIALIST and COMMUNIST economic models ALWAYS FAIL. Your posting of such wrong-headed articles, simply tells me that you are either ignorant of reality or unable to accept it, when faced with facts, PERIOD.
To:Skippy, toe-jam, old man Fred Alzheimers Mertz, _jim, loonymom/ming, e-type-jackoff, goober56, Wrek, calcon, dummy DwarF, continental op, Biff, gobsheit and meguro From: Capitalist Eric Message: You're SOCIALIST morons. ESAD. Quit being so autistic, no one even pinged you to this thread much less 'cited' anything to you.
Rule of Disinformation #9. Play Dumb. No matter what evidence or logical argument is offered, avoid discussing issues with denial they have any credibility, make any sense, provide any proof, contain or make a point, have logic, or support a conclusion. Mix well for maximum effect. Rule of Disinformation #18. Emotionalize, Antagonize, and Goad Opponents. If you can’t do anything else, chide and taunt your opponents and draw them into emotional responses which will tend to make them look foolish and overly motivated, and generally render their material somewhat less coherent. Not only will you avoid discussing the issues in the first instance, but even if their emotional response addresses the issue, you can further avoid the issues by then focusing on how “sensitive they are to criticism”. Nice try, loonymom/whining-old. I'm sure you'll be switching screen-names throughout the day, to "talk" to yourself. LOL
To:Skippy, toe-jam, old man Fred Alzheimers Mertz, _jim, loonymom/ming, e-type-jackoff, goober56, Wrek, calcon, dummy DwarF, continental op, Biff, gobsheit and meguro From: Capitalist Eric Message: You're SOCIALIST morons. ESAD. LOL I knew Autistic Eric would take the bait. Do you really have delusions that posters are talking to you directly even when you aren't pinged?
What "bait?" You posted a reply directly to me, you silly bimbo. Your sense of wit is low-brow- at best. What, you're saying you did NOT reply to my post? You've already admitted that you're both loonymom and whining-old (HERE), so why do you insist on continuing the charade? Oh, I'm sure you think you're clever... The sad reality is that you're dummy in the room, trying to get over on everyone else... And the only one who doesn't get how stupid you look, is YOU.
To:Skippy, toe-jam, old man Fred Alzheimers Mertz, _jim, loonymom/ming, e-type-jackoff, goober56, Wrek, calcon, dummy DwarF, continental op, Biff, gobsheit and meguro From: Capitalist Eric Message: You're SOCIALIST morons. ESAD. You've been predicting this hyperinflation for 8 years by my count. Any day now, right? [snicker]
America...My Kind Of Place... "I truly am not that concerned about [bin Laden]..." "THE MILITIA IS COMING!!! THE MILITIA IS COMING!!!" I lurk to see if someone other than Myst or Pookie posts anything...
You've already admitted that you're both loonymom and whining-old (HERE), so why do you insist on continuing the charade? Oh, I'm sure you think you're clever... The sad reality is that you're dummy in the room, trying to get over on everyone else... And the only one who doesn't get how stupid you look, is YOU. It's your statement. DoDo. I never admitted anything, I got posters mixed up as he had posted a similar statement to me. But don't let me get in the way of your Asperger's delusions. It's so funny to see you glom on to one statement as proof that your delusions are true, with NO amount of evidence to the contrary able to budge you from your wrongful conclusions.
He thinks he's the center of the universe.
"...all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being." Sandeep Jaitly
Low-brow wit on display.
"...all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being." Sandeep Jaitly
And 'normal'.
In short, the prospects for inflation have not been smaller since 1930.
#2. To: lucysmom, *Liberal Rehab Staff* (#1)
Author: L. Randall Wray
"We (government) need to do a lot less, a lot sooner" ~Ron Paul
#3. To: lucysmom (#1)
#4. To: hondo68 (#2)
Pay this guy a 1930 wage, and then maybe he'll be able to figure out that inflation is real.
#5. To: A K A Stone (#3)
(Edited)
So they should make us all millionaires. It should just take a few keystrokes. Er no billionaires, I want to be a billionaire.
#6. To: lucysmom (#5)
#7. To: lucysmom (#4)
Pay this guy a 1930 wage, and then maybe he'll be able to figure out that inflation is real.
#8. To: hondo68 (#2)
#9. To: All (#8)
#10. To: All (#9)
#11. To: lucysmom, Badeye (#1)
--GW Bush
--Sarah Palin's version of "The Midnight Ride of Paul revere"
#12. To: war (#11)
#13. To: lucysmom (#12)
--GW Bush
--Sarah Palin's version of "The Midnight Ride of Paul revere"
#14. To: lucysmom (#0)
Many fear that “Helicopter Ben” (Chairman Bernanke) has pumped so much “money” into the economy that high inflation, if not hyperinflation, will be the inevitable result. This is one of the reasons for the run into gold—supposedly an inflation hedge.
#15. To: Capitalist Eric (#14)
(Edited)
Do NOT cite demonstrably false government statistics to me, in the hope that I'll be so stupid as to believe them.
#16. To: mininggold (#15)
Rule of Disinformation #5. Sidetrack opponents with name calling and ridicule. This is also known as the primary attack the messenger ploy, though other methods qualify as variants of that approach. Associate opponents with unpopular titles such as “kooks”, “right-wing”, “liberal”, “left- wing”, “terrorists”, “conspiracy buffs”, “radicals”, “militia”, “racists”, “religious fanatics”, “sexual deviates”, and so forth. This makes others shrink from support out of fear of gaining the same label, and you avoid dealing with issues.
#17. To: Capitalist Eric (#16)
Nice try, loonymom/whining-old. I'm sure you'll be switching screen-names throughout the day, to "talk" to yourself.
#18. To: mininggold (#17)
I knew Autistic Eric would take the bait.
Do you really have delusions that posters are talking to you directly even when you aren't pinged?
#19. To: Capitalist Eric (#16)
--GW Bush
--Sarah Palin's version of "The Midnight Ride of Paul revere"
#20. To: Capitalist Eric (#18)
What, you're saying you did NOT reply to my post?
#21. To: mininggold (#17)
Do you really have delusions that posters are talking to you directly even when you aren't pinged?
#22. To: Capitalist Eric, All (#18)
You've already admitted that you're both loonymom and whining-old (HERE), so why do you insist on continuing the charade?
#23. To: lucysmom (#21)
(Edited)
He thinks he's the center of the universe.
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