By J.D. Alt
1. The “unsolvable” riddle of our National Budget
Being an architect, I’m fascinated by diagrams visualizing things which otherwise are invisible. In designing a building we usually begin with diagrams to explore and understand the functional and spatial relationships—the flows and often unexpected interactions—the architecture needs to accommodate. Getting the diagrams right is important—if they’re wrong or incomplete, the building we design could turn out to be a dysfunctional disappointment for its owners and users.
By Brian Hartley*
Modern banks are professional arbiters of financial IOUs secondary to that of the state or issuing authority. Central bank liabilities – reserves – form the most liquid and foundational instrument in the hierarchy of money, with intermediate obligations between banks ranking next, down finally to obligations issued by individuals. Banks facilitate the transfer of IOUs across and between various levels of the hierarchy, allowing transactions between individuals, extension of credit from the liquid to the illiquid, the transformation of maturities and transference of risk. Balance sheet expansion provides the liquidity necessary for increasing sophistication of the credit and payment system.
In early Summer 2013, Class Conscience interviewed Dr. Edward J. Nell, the Malcolm B. Smith Professor of Economics at the New School for Social Research in New York City. Both Drs. Stephanie Kelton and Mathew Forstater were students of Dr. Nell.