Author Archives: Devin Smith

Opportunities of a Millennium (Part 1)

By J.D. Alt

Viewed through the ideology of money-scarcity, the major challenges facing society appear to represent “costs” that people must be penalized to pay by taking dollars out of their personal pockets. At one level, politics is the endless and bitter argument of one party proposing to do X, Y, or Z in order to accomplish some collective benefit, and the other party saying: Yes, but how are you going to pay for it?—which is the “gotcha” question because everyone certainly “knows” that in order to actually do X, Y, or Z, the federal government will have to increase taxes or borrow dollars from the Private Sector pot. Understanding modern fiat money (and how to manage it as a collective tool) creates, as we now understand, a remarkably different and more useful perspective. With this new perspective, as we’re about to see, many of the biggest challenges we face as a collective society can be viewed not as a “cost”—a penalty to be paid—but instead as an enormous opportunity to make our lives, both collectively and individually, more effective and prosperous. Confronting these challenges, in other words, will not take dollars out of our personal pockets, it will—in addition to hopefully overcoming the challenge addressed—put dollars into our pockets. This, in essence, is the uniquely empowering perspective that modern fiat money makes possible.

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Entrevista a Randall Wray

The full interview with NEP’s Randy Wray by EKO de Público TV in Spain. This is the complete interview. Questions from the interviewer are in spanish. Randy’s responses are subtitled in spanish. This was recorded on March 6, 2015 as part of his introduction of the spanish version of the Modern Money Primer.

 

What Does it Take to Get Fired at the SEC?

By William K. Black
Quito: Happy St. Patrick’s Day 2015

“Yves Smith” has a distressingly wonderful column in her blog, NakedCapitalism, on the SEC’s Andrew Bowden.  The SEC Chair, Mary Jo White, needs to read it and walk to Bowden’s office and tell him she needs his resignation letter on her desk by noon or she will terminate his employment.  When the SEC appointed Bowden as its lead examiner it put out a press release that purported that his unit was hiring folks from the industry like Bowden, which was going to make it a competent, kick-ass regulator.

“The SEC’s National Exam Program conducts inspections and examinations of SEC-registered investment advisers, investment companies, broker-dealers, self-regulatory organizations, clearing agencies, and transfer agents. OCIE has adopted a risk-focused examination program, hired industry experts, leveraged technology to increase efficiency, and launched a training program focused on quality and consistency. These initiatives have enabled OCIE to more effectively fulfill its mission to promote compliance with U.S. securities laws, prevent fraud, monitor risk, and inform SEC policy.”

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State of Thieves

By Deirdre N.  McCloskey
University of Illinois at Chicago

Nearly as published, Wall Street Journal, Saturday, Feb 28, 2015

The theme of Sarah Chayes’s “Thieves of State” is that corruption can’t be ignored as a source of international instability.  The injustice of it enrages people.  Corruption thus becomes “an important driver of conflict worldwide,” as Ms. Chayes puts it.  “Abusive government corruption prompts extreme responses and thus represents a mortal threat to security.”  Ms. Chayes, who in her seven years in Afghanistan worked as a reporter for National Public Radio, as an NGO administrator and as an advisor to Gen.  Stanley McChrystal, witnessed programs against corruption initiated by the NGOs, NATO, and the U.S.  Army fail and fail again, co-opted by the Karzai brothers and worse.  She tells the story of what happened in Afghanistan brilliantly, and compares her experience there with the current corruption in Egypt, Russia and the dismal rest.  In all of these places, the officials extract money from the system, the citizens cheat the system, and the business interests co-opt the system.  It’s an old story, from the corrupt judges the prophet Amos blasted to the love-besotted governor in squeaky-clean Oregon.

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Robin Hood in Reverse

Senator Sanders’ presentation before hearings focusing on deficit and debt. He calls for a full employment budget.

Randall Wray: ¿Austeridad presupuestaria frente a déficits públicos?

Why the EMU is designed to Fail

Randy’s presentation for FUHEM in Madrid, Spain coinciding with the release of the spanish version of his Modern Money Primer. The introductions are in spanish and Randy speaks in english beginning at about 10:00 with a panel member translating to spanish. He presents  Modern Money Theory and then what is wrong with the Euro/EMU.  

Why Understanding Money Matters in Greece

By Robert W. Parenteau
March 06, 2015

As Greece staggers under the weight of a depression exceeding that of the 1930s in the US, it appears difficult to see a way forward from what is becoming increasingly a Ponzi financed, extend and pretend, “bailout” scheme. In fact, there are much more creative and effective ways to solve some of the macrofinancial dilemmas that Greece is facing, and without Greece having to exit the euro. But these solutions challenge many existing economic paradigms, including the concept of “money” itself.

At the Levy Economics Institute conference held in Athens in November 2013, I proposed tax anticipation notes, or “TANs”, as a way for Greece to exit austerity without having to exit the euro (see “Get a TAN, Yanis!” published here last month, for an updated version of that policy proposal). This proposal is based on a deeper understanding of what money actually is, and the many roles that it plays in the economies we inhabit. In this regard, Abba Lerner captured the essence of modern fiat currencies, which are created out of thin air by modern states with sovereign currency arrangements. Lerner’s essential insight is contained in the following passage from over half a century ago (and, you will note, Lerner’s view informs much of the neo-chartalist view espoused by advocates of what is called Modern Monetary Theory):

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Job Guarantee Presentation in Madrid Spain

Teoría Monetaria Moderna

For our Spanish speaking friends, below are materials for the Madrid launch (March 3-8) of L. Randall Wray’s Modern Money Primer in Spanish – Teoría Monetaria Moderna.

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Irish-Style Banking Inquiry into the 2008 Financial Crisis

NEP’s Bill Black on The Real News Network discussing his recent testimony in Ireland for a banking inquiry and the challenges the country faces in acknowledging its financial crisis. Video is below. For the transcript, click here.