tag:blogger.com,1999:blog-4900303239154048192.post7107930921804978979..comments2024-03-06T06:34:42.881-05:00Comments on EconoSpeak: Debt, Income and Aggregate Demand: Scoring Krugman vs KeenUnknownnoreply@blogger.comBlogger12125tag:blogger.com,1999:blog-4900303239154048192.post-8904837286801759752013-06-27T03:00:06.765-04:002013-06-27T03:00:06.765-04:00Blogger David said...
"NET debt. NET debt. It...<br /><br />Blogger David said...<br />"NET debt. NET debt. It would be nice if Keen came around to recognizing that."<br /><br />Why?<br />Anonymoushttps://www.blogger.com/profile/04501940617030009190noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-1378878359050589422013-06-27T02:58:09.950-04:002013-06-27T02:58:09.950-04:00ARIJIT BANIK said...
"private debt reflects a...ARIJIT BANIK said...<br />"private debt reflects a trade between an impatient borrower and a patient saver hence my allusion to debt and savings"<br />This is not true. Banks do NOT lend savings, they have a legal privilege to create credit. It is savings that create deposits. But they cannot create net financial assets as loans = deposits. <br />This is why while the majority of the money supply is bank credit, the only net financial assets held by the private sector are government debt (money, bonds).Anonymoushttps://www.blogger.com/profile/04501940617030009190noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-36509736766259832612012-07-12T06:18:25.801-04:002012-07-12T06:18:25.801-04:00Some of points from this article are very helpful ...Some of points from this article are very helpful for me as I haven’t considered them yet. I would like to say thank you for sharing this cool article. Bookmarked and sharing for friends. More about <a href="http://www.rabodirect.com.au/premiumsaver/default.aspx" rel="nofollow">savings calculator</a>.annasalvatorhttps://www.blogger.com/profile/04364043881966341033noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-43471445373363077202012-07-12T06:14:02.108-04:002012-07-12T06:14:02.108-04:00This comment has been removed by the author.annasalvatorhttps://www.blogger.com/profile/04364043881966341033noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-75356363069593407702012-04-20T14:38:38.556-04:002012-04-20T14:38:38.556-04:00I did not phrase clearly: from my understanding th...I did not phrase clearly: from my understanding the standard orthodox analysis is that private debt reflects a trade between an impatient borrower and a patient saver hence my allusion to debt and savings. Certainly, there are capital constraints in banking -- as a practitioner rather then a researcher/academic the idea of "capital consumption" is on the top of my concerns but fundamentally financial institutions make loans all the time based on risk limits in place. If the deal appears profitable on paper it will get done. And Europe's zombie banks do so without leverage rules; I don't see new capital adequacy rules making things safer BTW. Derivative contracts are amongst the many financial innovations that are not adequately accounted for in traditional macro models and add to the argument of endogenous money creation and against Krugman's stance (in my opinion). Can NET DEBT properly capture such contracts when they remain opaque and MTM is open to interpretation (e.g. if an auditor is dissatisfied with a valuation she may ask for 'market' levels).<br />Regards,Anonymoushttps://www.blogger.com/profile/07857616719536009725noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-31619021181996532562012-04-02T12:57:03.862-04:002012-04-02T12:57:03.862-04:00The emphasis has to be the lag between when these ...The emphasis has to be the lag between when these debt and lending decisions are made and when the central bank ratifies or repudiates them. When the debt increases asset values it can continue for years before inflation pressures rise and the central bank responds to them or never really responds to them but the bubble bursts. When created by lower lending standards and destroyed by higher ones a boom and bust is established, the bezel expanding and contracting over a period of years.Lordhttps://www.blogger.com/profile/06747994571555237739noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-14579955464237210012012-03-29T12:37:28.485-04:002012-03-29T12:37:28.485-04:00Well, in one version of the joke a man goes into a...Well, in one version of the joke a man goes into a bar to sell the bartender a keg, and then the bartender goes out onto the street to find some poor sucker to drink it. In the other version, a man goes into the bar, orders a beer, the bartender pours it and orders another keg. Funny enough for you? ;)Peter Dormanhttps://www.blogger.com/profile/00093399591393648071noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-47567914828192351902012-03-29T12:18:01.419-04:002012-03-29T12:18:01.419-04:00Well,damn: I skimmed the post and thought I read &...Well,damn: I skimmed the post and thought I read "a man goes into a bar...." and was all ready for some jokes! Maybe after he goes into the bank, he goes into a bar and the bartender says,"What is this? Some kind of a joke?"kevin quinnhttps://www.blogger.com/profile/04880872194080353414noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-78590856008395499512012-03-29T00:55:43.538-04:002012-03-29T00:55:43.538-04:00I think if you want to get into MMT land, then you...I think if you want to get into MMT land, then you ought to go to MMT blogs. The top 3 MMT blogs are: http://moslereconomics.com/<br /><br />http://neweconomicperspectives.org/<br /><br />http://bilbo.economicoutlook.net/blog/Letsgetitdonehttps://www.blogger.com/profile/07607539419260450949noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-81234770698179011592012-03-28T15:30:11.335-04:002012-03-28T15:30:11.335-04:00The money multiplier argument is a fallacy as is t...<i>The money multiplier argument is a fallacy as is the idea of one man's debt is another's savings. I have no problem in siding with Keen on this one.</i><br /><br />I've never heard "one man's debt is another's savings." I've heard "one man's debt is another's asset," which is in fact true.<br /><br />I don't think there's a lot of disputing that one may create financial assets out of nothing. The creation of <b>net</b> financial assets is another question.Viscid Konradhttps://www.blogger.com/profile/02958267196850219430noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-13619923420067557312012-03-28T15:20:51.839-04:002012-03-28T15:20:51.839-04:00You should not label Keen as an MMT guy; he has di...You should not label Keen as an MMT guy; he has differences with that school. Orthodox economists --whether they be fresh water or salt water makes no difference as they argue over minutiae such as informational asymmetries-- should be invited to see the workings of money center banks, specifically a dealing room. No global bank in the world can state their liabilities (client's savings) at the end of each day such is the complexity of flows. Loans are made based on their risk appetite; reserves are a secondary concern. The money multiplier argument is a fallacy as is the idea of one man's debt is another's savings. I have no problem in siding with Keen on this one.Anonymoushttps://www.blogger.com/profile/07857616719536009725noreply@blogger.comtag:blogger.com,1999:blog-4900303239154048192.post-66290703055327154872012-03-28T12:49:44.209-04:002012-03-28T12:49:44.209-04:00NET debt. NET debt. It would be nice if Keen cam...NET debt. NET debt. It would be nice if Keen came around to recognizing that.<br /><br />Of course, I'm still confused by this idea of AD being a number rather than a schedule, but that's for another day.<br /><br />For now, expenditures equal income plus NET dissaving-- not Keen's GROSS.Viscid Konradhttps://www.blogger.com/profile/02958267196850219430noreply@blogger.com