March 11, 2019
Hype does not help: MMT is toast
Comment on Bill Mitchell on ‘The conga line of MMT critics ― marching into oblivion’
Blog-Reference and Blog-Reference Mar 12 and Blog-Reference Mar 13
After 200+ years of failure, economists still present themselves as scientists and experts. Fact is, though, that economics is NOT part of science but an integral part of the political Circus Maximus. Accordingly, by mentioning MMT in the context of her Green New Deal initiative, the representative Alexandria Ocasio-Cortez’s triggered an avalanche of political/economical comments.
As Bill Mitchell observes: “The rising popularity of MMT is bringing out a lot of people from the woodwork who have ignored our work until now but who, for one reason or another, feel they have to have a stake in the game or look stupid.”
It is indeed pretty obvious that a lot of mainstream critique of MMT is just stupid.#1 This is no surprise because, by definition, one must be rather stupid to be a card-carrying mainstreamer, which means still failing to realize that standard economics is proto-scientific garbage. Therefore, Bill Mitchell is right: “And, they mostly end up looking foolish given the quality of their criticisms.”
To win an argument against a mainstreamer is easy but does by no stretch of the imagination imply that MMT itself is scientifically acceptable. What MMT has actually achieved is this: “The whole MMT journey to date has been to caution readers about the actual nature of constraints on government spending rather than the false constraints taught in economics courses around the world and wheeled out continually by self-serving politicians and lobbyists. By showing there are no intrinsic financial constraints on such spending, MMT, in no way, is advocating a carte blanche.”
This, though, is a rather trivial point. MMT has clarified a lot of silly misunderstanding and the unqualified critique of mainstreamers. MMT is clearly superior to mainstream economics because it is macrofounded. However, MMT has not answered to the scientific refutation, i.e. the proof of inconsistency#2 and its far-reaching implication.#3
• MMT’s macroeconomic foundations are unacceptable, i.e. MMT’s foundational sectoral balances equation is mathematically false, more specifically (I−S)+(G−T)+(X−M)=0 is false and (I−S)+(G−T)+(X−M)−(Q−Yd)=0 is true. This is a testable proposition.
• Because the axiomatic foundations are false, one can safely forget the rest. MMT is fake science.
• By not addressing refutation but systematically blocking it, MMTers violate scientific standards.
• On the one hand, Bill Mitchell claims: “MMT is not about political theory or praxis.” On the other hand, MMTers present themselves as Progressives and criticize the genuine left-wing parties and movements for having swallowed Neoliberalism.#4
• As a matter of fact, MMT is political agenda pushing in a scientific bluff package.
• Because of the macroeconomic Profit Law, i.e. Public Deficit = Private Profit, the MMT policy of deficit-spending/money-creation is NOT for the benefit of WeThePeople but of the Oligarchy.#5 MMT is just another political fraud.
In the final analysis, MMTers are either stupid or corrupt ― just like mainstream economists. This turns every discussion between the two political sects into an absurd proto-scientific performance.#6
Egmont Kakarot-Handtke
#1 Paul’s and Stephanie’s economic delirium talk
#2 The final implosion of MMT
#3 MMT for beginners
#4 MMT Progressives: stupid or corrupt or both?
#5 Very busy these days: Wall Street’s agents
#6 The clock runs down on economics
Related 'MMT-Refutation for Dummies' and 'Misrepresenting MMT' and 'Krugman vs MMT ― like the blind talking about colors' and 'The half-truths and half-falsehoods of MMT' and 'Opinion, conversation, interpretation, blather: the economist’s major immunizing stratagems' and 'From MMT misunderstandings to the true Theory of Money' and 'Debunking idiots does not prove that MMT is valid' and 'Very busy these days: Wall Street’s agents' and 'MMT and the promotion of Wall Street socialism' and 'MMT = proto-scientific junk + deception of the 99-percenters' and 'How MMT enlightens Washington' and 'MMT, Warren Mosler, and the little helpers from Wall Street and Academia' and 'MMT: The fusion of Wall Street and Academia'.
Comment on Bill Mitchell on ‘The conga line of MMT critics ― marching into oblivion’
Blog-Reference and Blog-Reference Mar 12 and Blog-Reference Mar 13
After 200+ years of failure, economists still present themselves as scientists and experts. Fact is, though, that economics is NOT part of science but an integral part of the political Circus Maximus. Accordingly, by mentioning MMT in the context of her Green New Deal initiative, the representative Alexandria Ocasio-Cortez’s triggered an avalanche of political/economical comments.
As Bill Mitchell observes: “The rising popularity of MMT is bringing out a lot of people from the woodwork who have ignored our work until now but who, for one reason or another, feel they have to have a stake in the game or look stupid.”
It is indeed pretty obvious that a lot of mainstream critique of MMT is just stupid.#1 This is no surprise because, by definition, one must be rather stupid to be a card-carrying mainstreamer, which means still failing to realize that standard economics is proto-scientific garbage. Therefore, Bill Mitchell is right: “And, they mostly end up looking foolish given the quality of their criticisms.”
To win an argument against a mainstreamer is easy but does by no stretch of the imagination imply that MMT itself is scientifically acceptable. What MMT has actually achieved is this: “The whole MMT journey to date has been to caution readers about the actual nature of constraints on government spending rather than the false constraints taught in economics courses around the world and wheeled out continually by self-serving politicians and lobbyists. By showing there are no intrinsic financial constraints on such spending, MMT, in no way, is advocating a carte blanche.”
This, though, is a rather trivial point. MMT has clarified a lot of silly misunderstanding and the unqualified critique of mainstreamers. MMT is clearly superior to mainstream economics because it is macrofounded. However, MMT has not answered to the scientific refutation, i.e. the proof of inconsistency#2 and its far-reaching implication.#3
• MMT’s macroeconomic foundations are unacceptable, i.e. MMT’s foundational sectoral balances equation is mathematically false, more specifically (I−S)+(G−T)+(X−M)=0 is false and (I−S)+(G−T)+(X−M)−(Q−Yd)=0 is true. This is a testable proposition.
• Because the axiomatic foundations are false, one can safely forget the rest. MMT is fake science.
• By not addressing refutation but systematically blocking it, MMTers violate scientific standards.
• On the one hand, Bill Mitchell claims: “MMT is not about political theory or praxis.” On the other hand, MMTers present themselves as Progressives and criticize the genuine left-wing parties and movements for having swallowed Neoliberalism.#4
• As a matter of fact, MMT is political agenda pushing in a scientific bluff package.
• Because of the macroeconomic Profit Law, i.e. Public Deficit = Private Profit, the MMT policy of deficit-spending/money-creation is NOT for the benefit of WeThePeople but of the Oligarchy.#5 MMT is just another political fraud.
In the final analysis, MMTers are either stupid or corrupt ― just like mainstream economists. This turns every discussion between the two political sects into an absurd proto-scientific performance.#6
Egmont Kakarot-Handtke
#1 Paul’s and Stephanie’s economic delirium talk
#2 The final implosion of MMT
#3 MMT for beginners
#4 MMT Progressives: stupid or corrupt or both?
#5 Very busy these days: Wall Street’s agents
#6 The clock runs down on economics
Related 'MMT-Refutation for Dummies' and 'Misrepresenting MMT' and 'Krugman vs MMT ― like the blind talking about colors' and 'The half-truths and half-falsehoods of MMT' and 'Opinion, conversation, interpretation, blather: the economist’s major immunizing stratagems' and 'From MMT misunderstandings to the true Theory of Money' and 'Debunking idiots does not prove that MMT is valid' and 'Very busy these days: Wall Street’s agents' and 'MMT and the promotion of Wall Street socialism' and 'MMT = proto-scientific junk + deception of the 99-percenters' and 'How MMT enlightens Washington' and 'MMT, Warren Mosler, and the little helpers from Wall Street and Academia' and 'MMT: The fusion of Wall Street and Academia'.
March 7, 2019
The clock runs down on economics
Comment on Stephanie Kelton on ‘The Clock Runs Down on Mainstream Keynesianism’*
Blog-Reference
Almost everybody knows by now that mainstream economics is dead. As a matter of fact, mainstream economics was already dead in the cradle 140+ years ago. The real wonder is why it is still around and why failed scientists like Paul Krugman are still producing proto-scientific garbage. For some reason, the basic methodological principle of science, i.e. to discard falsified theories, does not work in economics. The simple idea of scientific progress is that theories that have been proven materially/formally inconsistent are unceremoniously buried at the Flat-Earth-Cemetery and the attention turns to a more promising research program.
Applied to economics, this means that mainstream folks like Krugman are done.#1 However, there is a snag: “… it takes a new theory, and not just the destructive exposure of assumptions or the collection of new facts, to beat an old theory.” (Blaug)
Stephanie Kelton claims that MMT is the new theory that hammers the final nail in Paul Krugman’s coffin: “No economist is going to get everything right. But the odds of getting things right improve dramatically when you’re working with a macro framework that doesn’t lead you astray. The IS-LM framework is a gadget that will often align with sensible real-world analysis. It may perform better than a stopped clock, but it is no match for MMT.” and “The [IS-LM] model remains the workhorse for many mainstream Keynesians. MMT considers it fundamentally flawed.”#2
On this point, Stephanie Kelton is absolutely right: IS-LM is refuted on all counts#3 and only stupid or corrupt economists still apply it.
However, from this does not follow that MMT is the long-awaited replacement for mainstream economics. Although MMT is way better than IS-LM it is still flawed. The curious thing is, that IS-LM and MMT share the same foundational blunder which can be traced back to Keynes’General Theory.#4
From the methodological standpoint, both New Keynesianism and MMT is empirically/ logically inconsistent and not much more than commonsensical storytelling. Neither Paul Krugman’s nor Stephanie Kelton’s policy guidance has sound scientific foundations.
In order to make her point, Stephanie Kelton cites Galbraith: “There are two ways to get the increase in total spending that we call ‘economic growth.’ One way is for government to [deficit] spend. The other is for banks to lend. For ordinary people, public budget deficits, despite their bad reputation, are much better than private loans. Deficits put money in private pockets…This is called an increase in ‘net financial wealth’… In contrast, when a bank makes a loan, the cash is not owned free and clear.”
This is a hard to disentangle analytical half-truth and a full political fraud. Because it holds Public Deficit = Private Profit, MMT deficit-spending/money-creation puts money in the pockets of the Oligarchy. The fundamental law of Capitalism is the macroeconomic Profit Law and it says Q=Yd+(I−S)+(G−T)+(X−M) which boils down to Q=(G−T), i.e. profit Q is equal to the government’s deficit spending G>T.
The claim that MMT policy is for the benefit of WeThePeople is provably false. Because MMT gets the foundational concept of profit wrong, the whole theory is scientifically worthless. Politically, MMT is for the benefit of the Oligarchy.#5, #6 In the final analysis, MMTers are either stupid or corrupt ― just like mainstream economists..#7, #8, #9
The clock runs down not only on Paul Krugman’s New Keynesianism but also on Stephanie Kelton’s MMT.
Egmont Kakarot-Handtke
* BloombergOpinion, The clock runs down and BloombergOpinion, 4 Answers
#1 Enough! Economists, retire now!
#2 How to finally hammer down the nails in the coffin of Monty Python economics
#3 Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It
#4 Krugman vs MMT ― like the blind talking about colors
#5 Keynes, Lerner, MMT, Trump and exploding profit
#6 MMTers make Capitalism work
#7 The Kelton-Fraud
#8 MMT: The one deadly error/fraud of Warren Mosler
#9 Bill Mitchell, MMT’s fake scientist
Related 'Paul’s and Stephanie’s economic delirium talk'
Comment on Stephanie Kelton on ‘The Clock Runs Down on Mainstream Keynesianism’*
Blog-Reference
Almost everybody knows by now that mainstream economics is dead. As a matter of fact, mainstream economics was already dead in the cradle 140+ years ago. The real wonder is why it is still around and why failed scientists like Paul Krugman are still producing proto-scientific garbage. For some reason, the basic methodological principle of science, i.e. to discard falsified theories, does not work in economics. The simple idea of scientific progress is that theories that have been proven materially/formally inconsistent are unceremoniously buried at the Flat-Earth-Cemetery and the attention turns to a more promising research program.
Applied to economics, this means that mainstream folks like Krugman are done.#1 However, there is a snag: “… it takes a new theory, and not just the destructive exposure of assumptions or the collection of new facts, to beat an old theory.” (Blaug)
Stephanie Kelton claims that MMT is the new theory that hammers the final nail in Paul Krugman’s coffin: “No economist is going to get everything right. But the odds of getting things right improve dramatically when you’re working with a macro framework that doesn’t lead you astray. The IS-LM framework is a gadget that will often align with sensible real-world analysis. It may perform better than a stopped clock, but it is no match for MMT.” and “The [IS-LM] model remains the workhorse for many mainstream Keynesians. MMT considers it fundamentally flawed.”#2
On this point, Stephanie Kelton is absolutely right: IS-LM is refuted on all counts#3 and only stupid or corrupt economists still apply it.
However, from this does not follow that MMT is the long-awaited replacement for mainstream economics. Although MMT is way better than IS-LM it is still flawed. The curious thing is, that IS-LM and MMT share the same foundational blunder which can be traced back to Keynes’General Theory.#4
From the methodological standpoint, both New Keynesianism and MMT is empirically/ logically inconsistent and not much more than commonsensical storytelling. Neither Paul Krugman’s nor Stephanie Kelton’s policy guidance has sound scientific foundations.
In order to make her point, Stephanie Kelton cites Galbraith: “There are two ways to get the increase in total spending that we call ‘economic growth.’ One way is for government to [deficit] spend. The other is for banks to lend. For ordinary people, public budget deficits, despite their bad reputation, are much better than private loans. Deficits put money in private pockets…This is called an increase in ‘net financial wealth’… In contrast, when a bank makes a loan, the cash is not owned free and clear.”
This is a hard to disentangle analytical half-truth and a full political fraud. Because it holds Public Deficit = Private Profit, MMT deficit-spending/money-creation puts money in the pockets of the Oligarchy. The fundamental law of Capitalism is the macroeconomic Profit Law and it says Q=Yd+(I−S)+(G−T)+(X−M) which boils down to Q=(G−T), i.e. profit Q is equal to the government’s deficit spending G>T.
The claim that MMT policy is for the benefit of WeThePeople is provably false. Because MMT gets the foundational concept of profit wrong, the whole theory is scientifically worthless. Politically, MMT is for the benefit of the Oligarchy.#5, #6 In the final analysis, MMTers are either stupid or corrupt ― just like mainstream economists..#7, #8, #9
The clock runs down not only on Paul Krugman’s New Keynesianism but also on Stephanie Kelton’s MMT.
Egmont Kakarot-Handtke
* BloombergOpinion, The clock runs down and BloombergOpinion, 4 Answers
#1 Enough! Economists, retire now!
#2 How to finally hammer down the nails in the coffin of Monty Python economics
#3 Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It
#4 Krugman vs MMT ― like the blind talking about colors
#5 Keynes, Lerner, MMT, Trump and exploding profit
#6 MMTers make Capitalism work
#7 The Kelton-Fraud
#8 MMT: The one deadly error/fraud of Warren Mosler
#9 Bill Mitchell, MMT’s fake scientist
Related 'Paul’s and Stephanie’s economic delirium talk'
***
Short version: The clock runs down on economics
Blog-Reference Mar 8
Almost everybody knows by now that mainstream economics is dead. As a matter of fact, mainstream economics was already dead in the cradle 140+ years ago. The real wonder is why it is still around and why failed scientists like Paul Krugman are still producing proto-scientific garbage. For some reason, the basic methodological principle of science, i.e. to discard falsified theories, does not work in economics. The simple idea of scientific progress is that theories that have been proven materially/formally inconsistent are unceremoniously buried at the Flat-Earth-Cemetery and the attention turns to a more promising research program.
Applied to economics, this means that mainstream folks like Krugman are done.#1 However, there is a snag: “… it takes a new theory, and not just the destructive exposure of assumptions or the collection of new facts, to beat an old theory.” (Blaug)
Stephanie Kelton claims that MMT is the new theory that hammers the final nail in Paul Krugman’s coffin.
…
For the full 3618-character post see here
…
The claim that MMT policy is for the benefit of WeThePeople is provably false. Because MMT gets the foundational concept of profit wrong, the whole theory is scientifically worthless.
The clock runs down not only on Paul Krugman’s New Keynesianism but also on Stephanie Kelton’s MMT.
Blog-Reference Mar 8
Almost everybody knows by now that mainstream economics is dead. As a matter of fact, mainstream economics was already dead in the cradle 140+ years ago. The real wonder is why it is still around and why failed scientists like Paul Krugman are still producing proto-scientific garbage. For some reason, the basic methodological principle of science, i.e. to discard falsified theories, does not work in economics. The simple idea of scientific progress is that theories that have been proven materially/formally inconsistent are unceremoniously buried at the Flat-Earth-Cemetery and the attention turns to a more promising research program.
Applied to economics, this means that mainstream folks like Krugman are done.#1 However, there is a snag: “… it takes a new theory, and not just the destructive exposure of assumptions or the collection of new facts, to beat an old theory.” (Blaug)
Stephanie Kelton claims that MMT is the new theory that hammers the final nail in Paul Krugman’s coffin.
…
For the full 3618-character post see here
…
The claim that MMT policy is for the benefit of WeThePeople is provably false. Because MMT gets the foundational concept of profit wrong, the whole theory is scientifically worthless.
The clock runs down not only on Paul Krugman’s New Keynesianism but also on Stephanie Kelton’s MMT.
***
LINKS on Mario Seccareccia/Marc Lavoie’s ‘Sir John and Maynard Would Have Rejected the IS-LM Framework for Conducting Macroeconomic Analysis’ on Mar 11
Keynes messed up macroeconomics. IS-LM is proto-scientific garbage for 80+ years. For details see
► How Keynes got macro wrong and Allais got it right
► Dear idiots, time to get saving and investment straight
► Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It
► Getting out of IS-LM = Getting out of despair
► Where modern macroeconomics went wrong
► John Hicks, fake scientist
Keynes messed up macroeconomics. IS-LM is proto-scientific garbage for 80+ years. For details see
► How Keynes got macro wrong and Allais got it right
► Dear idiots, time to get saving and investment straight
► Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It
► Getting out of IS-LM = Getting out of despair
► Where modern macroeconomics went wrong
► John Hicks, fake scientist
Labels: Ethics, Failure, Keynesianism, Macrofoundations,Microfoundations, MMT, Profit, Science, z#, zINET, zML, zMNE,zNYT
March 6, 2019
Austrians, too, are either stupid or corrupt or both
Comment on Bob Roddis on ‘Albert Edwards ― Abba Lerner ― Functional Finance’
Blog-Reference
To the argument: “Governments have to intervene in the national and global economy; these economies are not self-regulating.” Bob Roddis answers: “A totally false and baseless assertion. This is the BIG LIE of socialism and Keynesianism. Why do you think Keynes avoided refuting Hayek in The General Theory?” and “There is no need to ‘set’ a ‘desired level of activity’ if only because a market economy is totally ‘self-regulating’ until distorted by fiat money and violent intervention.”
Defamation is since the Sophists#1 the modus operandi of political imbeciles. Economics as a science deals with proofs of material and formal consistency and nothing else. Austrians never understood (i) how science works, (ii) how the economy works.
Austrianism is based on the provably false assumption that the economy is self-regulating. This is NOT the case.#2, #3 And this means that with regard to the pivotal point of economics, Keynes was right and Hayek was wrong.#4
Keynes, though, messed up macroeconomics. Here is the all-decisive blunder: “Income = value of output = consumption + investment. Saving = income − consumption. Therefore saving = investment.” (GT, p. 63) “His Collected Writings show that he wrestled to solve the Profit Puzzle up till the semi-final versions of his GT but in the end he gave up and discarded the draft chapter dealing with it.” (Tómasson et al.)
The fake scientist Keynes NEVER understood what profit is and thus ended with I=S ― one of the worst blunders since the Flat-Earth hypothesis.#5 However, neither pro-Keynesians like Lerner nor anti-Keynesians like Hayek spotted the lethal blunder in the last 80+ years.#6
Because Marxianism is refuted on all counts, there is NO use to defame Abba Lerner as a “COMMIE”.#7 Lerner was simply a scientifically incompetent economist and a useful political idiot just like Hayek and Keynes or, for that matter, the MMTers and Austrians of today.
So, why don’t you simply be friends? MMTers and Austrians will both end up at the Flat-Earth-Cemetery in the extra-large corner reserved for stupid and corrupt economists.
Egmont Kakarot-Handtke
#1 Wikipedia
#2 Could we, please, all focus on the key question of economics?
#3 Proof of the inherent instability of the market economy
#4 Hayek ― agenda pusher or scientist?
#5 Dear idiots, time to get saving and investment straight
#6 Keynes, Lerner, MMT, Trump and exploding profit
#7 Here is the long overdue scientific death certificate for Marx and Marxists
Comment on Bob Roddis on ‘Albert Edwards ― Abba Lerner ― Functional Finance’
Blog-Reference
To the argument: “Governments have to intervene in the national and global economy; these economies are not self-regulating.” Bob Roddis answers: “A totally false and baseless assertion. This is the BIG LIE of socialism and Keynesianism. Why do you think Keynes avoided refuting Hayek in The General Theory?” and “There is no need to ‘set’ a ‘desired level of activity’ if only because a market economy is totally ‘self-regulating’ until distorted by fiat money and violent intervention.”
Defamation is since the Sophists#1 the modus operandi of political imbeciles. Economics as a science deals with proofs of material and formal consistency and nothing else. Austrians never understood (i) how science works, (ii) how the economy works.
Austrianism is based on the provably false assumption that the economy is self-regulating. This is NOT the case.#2, #3 And this means that with regard to the pivotal point of economics, Keynes was right and Hayek was wrong.#4
Keynes, though, messed up macroeconomics. Here is the all-decisive blunder: “Income = value of output = consumption + investment. Saving = income − consumption. Therefore saving = investment.” (GT, p. 63) “His Collected Writings show that he wrestled to solve the Profit Puzzle up till the semi-final versions of his GT but in the end he gave up and discarded the draft chapter dealing with it.” (Tómasson et al.)
The fake scientist Keynes NEVER understood what profit is and thus ended with I=S ― one of the worst blunders since the Flat-Earth hypothesis.#5 However, neither pro-Keynesians like Lerner nor anti-Keynesians like Hayek spotted the lethal blunder in the last 80+ years.#6
Because Marxianism is refuted on all counts, there is NO use to defame Abba Lerner as a “COMMIE”.#7 Lerner was simply a scientifically incompetent economist and a useful political idiot just like Hayek and Keynes or, for that matter, the MMTers and Austrians of today.
So, why don’t you simply be friends? MMTers and Austrians will both end up at the Flat-Earth-Cemetery in the extra-large corner reserved for stupid and corrupt economists.
Egmont Kakarot-Handtke
#1 Wikipedia
#2 Could we, please, all focus on the key question of economics?
#3 Proof of the inherent instability of the market economy
#4 Hayek ― agenda pusher or scientist?
#5 Dear idiots, time to get saving and investment straight
#6 Keynes, Lerner, MMT, Trump and exploding profit
#7 Here is the long overdue scientific death certificate for Marx and Marxists
March 5, 2019
Too much ado about deficit spending
Comment on Kenneth Rogoff on ‘Modern Monetary Nonsense’*
Blog-Reference and Blog-Reference Mar 6 and Blog-Reference Mar 8
For some time now, MMTers are shouting from the rooftops that deficit-spending/money-creation is the solution to almost all economic/social/environmental problems or, in the words of Kenneth Rogoff, to use “the Fed’s balance sheet as a cash cow to fund expansive new social programs, especially in view of current low inflation and interest rates.”
This is indeed stupid for several reasons:
• The government, needless to emphasize, is well aware of the advantages of deficit-spending/money-creation but plans to exploit them for other purposes. What naive MMTers do not know is that the free fiscal space is not free at all but has already been allocated “to fight a financial crisis, respond to a large-scale natural disaster or pandemic, or mobilize for a physical conflict or cyberwar.”
• “The US is lucky that it can issue debt in dollars, …” There is no use to awaken foreign suckers to the fact that they are taken for a ride. “If investors become more reluctant to hold a country’s debt, they probably will not be too thrilled about holding its currency, either.”
• Don’t rock the Fake-America-Great-Again boat: “For the moment, the world is quite content to absorb more dollar debt at remarkably low interest rates. How to exploit this increased US borrowing capacity is ultimately a political decision.” Not waiting for MMT-twits, this decision has already been taken for the benefit of the one-percenters.
• In addition: “The right approach … is for the government to extend the maturity structure of its debt, borrowing long-term instead of short-term.” Because the longer the maturity, the higher the interest rate for the bondholders, i.e. the one-percenters.
• In addition: “And if things get really difficult, it is far easier to inflate down the value of captive long-term debt … than it is to inflate away short-term debt, …” No need for MMTers to shout around that it is NOT the US government that will go broke and that public debt will never be repaid.#1
• Finally: “Misguided ideas may yet drag the issue of US central-bank independence to center stage, …” Even naive MMTers must understand that the last thing anyone wants is a discussion about who runs and should run the central bank.
So, MMTers get it, although your ideas “have a grain of truth” it is “just nuts” to make so much fuss about it.#2 A public debt of $22 trillion should tell you that FED/TREASURY know already for a long time how to max out the no-limit public credit card without domestic/ foreign bondholders and the general public getting too nervous.#3 After all, because of Public Deficit = Private Profit, the so-called free market economy hangs on the life-support of the State, i.e. on a smoothly growing public debt.
MMTers stand for aggressive deficit-spending, Kenneth Rogoff stands for moderate deficit-spending. In the final analysis, all are in the same camp. And it is NOT the camp of WeThePeople.
Egmont Kakarot-Handtke
* Project Syndicate
#1 Some nasty MMT surprises behind the time horizon
#2 MMT: The art of shooting oneself in the head
#3 MMT, money printing, stealth taxation, and redistribution
Related 'MMT-Refutation for Dummies' and 'Paul’s and Stephanie’s economic delirium talk' and 'A battle for hearts and minds ― economics redefined' and 'How counterfeiters save America with an extra profit and make WeThePeople pay for it' and 'MMT ― backstop or advanced life support for the Oligarchy?' and 'MMT: An overdose of public-debt tranquilizers for WeThePeople' and 'Fraud comes always in the garb of charity, salvation, or imminent doom'.
Comment on Kenneth Rogoff on ‘Modern Monetary Nonsense’*
Blog-Reference and Blog-Reference Mar 6 and Blog-Reference Mar 8
For some time now, MMTers are shouting from the rooftops that deficit-spending/money-creation is the solution to almost all economic/social/environmental problems or, in the words of Kenneth Rogoff, to use “the Fed’s balance sheet as a cash cow to fund expansive new social programs, especially in view of current low inflation and interest rates.”
This is indeed stupid for several reasons:
• The government, needless to emphasize, is well aware of the advantages of deficit-spending/money-creation but plans to exploit them for other purposes. What naive MMTers do not know is that the free fiscal space is not free at all but has already been allocated “to fight a financial crisis, respond to a large-scale natural disaster or pandemic, or mobilize for a physical conflict or cyberwar.”
• “The US is lucky that it can issue debt in dollars, …” There is no use to awaken foreign suckers to the fact that they are taken for a ride. “If investors become more reluctant to hold a country’s debt, they probably will not be too thrilled about holding its currency, either.”
• Don’t rock the Fake-America-Great-Again boat: “For the moment, the world is quite content to absorb more dollar debt at remarkably low interest rates. How to exploit this increased US borrowing capacity is ultimately a political decision.” Not waiting for MMT-twits, this decision has already been taken for the benefit of the one-percenters.
• In addition: “The right approach … is for the government to extend the maturity structure of its debt, borrowing long-term instead of short-term.” Because the longer the maturity, the higher the interest rate for the bondholders, i.e. the one-percenters.
• In addition: “And if things get really difficult, it is far easier to inflate down the value of captive long-term debt … than it is to inflate away short-term debt, …” No need for MMTers to shout around that it is NOT the US government that will go broke and that public debt will never be repaid.#1
• Finally: “Misguided ideas may yet drag the issue of US central-bank independence to center stage, …” Even naive MMTers must understand that the last thing anyone wants is a discussion about who runs and should run the central bank.
So, MMTers get it, although your ideas “have a grain of truth” it is “just nuts” to make so much fuss about it.#2 A public debt of $22 trillion should tell you that FED/TREASURY know already for a long time how to max out the no-limit public credit card without domestic/ foreign bondholders and the general public getting too nervous.#3 After all, because of Public Deficit = Private Profit, the so-called free market economy hangs on the life-support of the State, i.e. on a smoothly growing public debt.
MMTers stand for aggressive deficit-spending, Kenneth Rogoff stands for moderate deficit-spending. In the final analysis, all are in the same camp. And it is NOT the camp of WeThePeople.
Egmont Kakarot-Handtke
* Project Syndicate
#1 Some nasty MMT surprises behind the time horizon
#2 MMT: The art of shooting oneself in the head
#3 MMT, money printing, stealth taxation, and redistribution
Related 'MMT-Refutation for Dummies' and 'Paul’s and Stephanie’s economic delirium talk' and 'A battle for hearts and minds ― economics redefined' and 'How counterfeiters save America with an extra profit and make WeThePeople pay for it' and 'MMT ― backstop or advanced life support for the Oligarchy?' and 'MMT: An overdose of public-debt tranquilizers for WeThePeople' and 'Fraud comes always in the garb of charity, salvation, or imminent doom'.
March 4, 2019
Economics: How to stop mental pollution and global dumbing
Comment on Brian Romanchuk on ‘DSGE Macro “Proves” There Are No Financial Constraints On Government’
Blog-Reference
Brian Romanchuk announces what he is going to do: “… I am describing DSGE models in this article. There is a desire among neoclassicals to ‘make MMT more rigorous’ by attempting to cast them in a DSGE model. If we look at the MMT academic literature, it is a subset of the post-Keynesian literature. It seems safe to say that every single behavioural assumption embedded in DSGE models is viewed as incorrect by at least one post-Keynesian. Making a literature ‘more rigorous’ by ignoring the actual contents of said literature is a very curious position for a scholar to take.”
The current state of economics is this: the four major approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent and all got the foundational concept of the subject matter ― profit ― wrong.
The basic idea of science is that if it turns out that a theory is either materially or logically false it is unceremoniously buried at the Flat-Earth-Cemetery and the attention turns to alternative approaches or, in Lakatosian terms, from a degenerating to a progressive research program.#1 This does not happen in economics. As Morgenstern observed back in 1941: “In economics we should strive to proceed, wherever we can, exactly according to the standards of the other, more advanced, sciences, where it is not possible, once an issue has been decided, to continue to write about it as if nothing had happened.”
This refusal to abandon falsehoods has a fatal effect. Economists not only waste time and mental/physical resources by studying and teaching and communicating their defunct theories, but they also multiply the absurdity by comparing and discussing two defunct theories. This gives rise to heated debates that always end where they have started: everybody goes out with essentially the same garbage in his head with which he came in.
One example of absurd cross-talk is the recent debate between the New Keynesian Paul Krugman and the MMTer Stephanie Kelton.#2 Another example is Brian Romanchuk’s futile attempt to find common ground between DSGE and MMT.
DSGE is known to be dead because ALL microfounded models are dead, ultimately because the Walrasian axioms are provably false. It was Keynes who realized this and tried to advance to macrofoundations: “The classical theorists resemble Euclidean geometers in a non-Euclidean world who, discovering that in experience straight lines apparently parallel often meet, rebuke the lines for not keeping straight ― as the only remedy for the unfortunate collisions which are occurring. Yet, in truth, there is no remedy except to throw over the axiom of parallels and to work out a non-Euclidean geometry. Something similar is required to-day in economics.”
The problem with Keynes’ paradigm shift, i.e. the move from microfoundations to macrofoundations, was that he messed it up. Unfortunately, Post-Keynesians followed him sheepishly up to MMT’s sectoral balances equation.#3, #4
The question is how can anybody take DSGE still seriously? Does any physicist at the cutting edge of research waste time to comment on the latest arguments of Flat-Earthers? The only interesting question with regard to DSGE is institutional: why are these scientific failures still around and have not been thrown out of academia long ago? Who finances and sponsors and promotes this senseless production of proto-scientific garbage? And why does Brian Romanchuk bring up Ljungqvist/Sargent’s No-Profit-Model? Have all these folks still not realized that there is NO such thing as a No-Profit economy?
It should be pretty obvious that economics can either be based on microfoundations or on macrofoundations. Any synthesis is inconsistent. The microfoundations approach is false and this is known since 80+ years. Scientific methodology requires that falsified theories are buried for good. To teach students supply-demand-equilibrium or DSGE or to recycle this brain dead garbage again and again in economic debates or in the econoblogosphere contributes to global dumbing.
Scientists don’t do this: “There is another alternative: to formulate a completely new research program and conceptual approach. As we have seen, this is often spoken of, but there is still no indication of what it might mean.” (Ingrao et al.)
It means, first of all, that economists who stubbornly recycle refuted theories, i.e. Walrasians, Keynesians, Marxians, Austrians, and MMTers get an immediate and dishonorable discharge from the sciences.
Egmont Kakarot-Handtke
#1 Caught in secular intellectual stagnation
#2 Paul’s and Stephanie’s economic delirium talk
#3 Dear idiots, time to get saving and investment straight (II)
#4 MMT-Refutation for Dummies
Related 'Dead men tweeting' and 'Unsmart allocators' and 'Economists: Either stupid or corrupt or both'.
Comment on Brian Romanchuk on ‘DSGE Macro “Proves” There Are No Financial Constraints On Government’
Blog-Reference
Brian Romanchuk announces what he is going to do: “… I am describing DSGE models in this article. There is a desire among neoclassicals to ‘make MMT more rigorous’ by attempting to cast them in a DSGE model. If we look at the MMT academic literature, it is a subset of the post-Keynesian literature. It seems safe to say that every single behavioural assumption embedded in DSGE models is viewed as incorrect by at least one post-Keynesian. Making a literature ‘more rigorous’ by ignoring the actual contents of said literature is a very curious position for a scholar to take.”
The current state of economics is this: the four major approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent and all got the foundational concept of the subject matter ― profit ― wrong.
The basic idea of science is that if it turns out that a theory is either materially or logically false it is unceremoniously buried at the Flat-Earth-Cemetery and the attention turns to alternative approaches or, in Lakatosian terms, from a degenerating to a progressive research program.#1 This does not happen in economics. As Morgenstern observed back in 1941: “In economics we should strive to proceed, wherever we can, exactly according to the standards of the other, more advanced, sciences, where it is not possible, once an issue has been decided, to continue to write about it as if nothing had happened.”
This refusal to abandon falsehoods has a fatal effect. Economists not only waste time and mental/physical resources by studying and teaching and communicating their defunct theories, but they also multiply the absurdity by comparing and discussing two defunct theories. This gives rise to heated debates that always end where they have started: everybody goes out with essentially the same garbage in his head with which he came in.
One example of absurd cross-talk is the recent debate between the New Keynesian Paul Krugman and the MMTer Stephanie Kelton.#2 Another example is Brian Romanchuk’s futile attempt to find common ground between DSGE and MMT.
DSGE is known to be dead because ALL microfounded models are dead, ultimately because the Walrasian axioms are provably false. It was Keynes who realized this and tried to advance to macrofoundations: “The classical theorists resemble Euclidean geometers in a non-Euclidean world who, discovering that in experience straight lines apparently parallel often meet, rebuke the lines for not keeping straight ― as the only remedy for the unfortunate collisions which are occurring. Yet, in truth, there is no remedy except to throw over the axiom of parallels and to work out a non-Euclidean geometry. Something similar is required to-day in economics.”
The problem with Keynes’ paradigm shift, i.e. the move from microfoundations to macrofoundations, was that he messed it up. Unfortunately, Post-Keynesians followed him sheepishly up to MMT’s sectoral balances equation.#3, #4
The question is how can anybody take DSGE still seriously? Does any physicist at the cutting edge of research waste time to comment on the latest arguments of Flat-Earthers? The only interesting question with regard to DSGE is institutional: why are these scientific failures still around and have not been thrown out of academia long ago? Who finances and sponsors and promotes this senseless production of proto-scientific garbage? And why does Brian Romanchuk bring up Ljungqvist/Sargent’s No-Profit-Model? Have all these folks still not realized that there is NO such thing as a No-Profit economy?
It should be pretty obvious that economics can either be based on microfoundations or on macrofoundations. Any synthesis is inconsistent. The microfoundations approach is false and this is known since 80+ years. Scientific methodology requires that falsified theories are buried for good. To teach students supply-demand-equilibrium or DSGE or to recycle this brain dead garbage again and again in economic debates or in the econoblogosphere contributes to global dumbing.
Scientists don’t do this: “There is another alternative: to formulate a completely new research program and conceptual approach. As we have seen, this is often spoken of, but there is still no indication of what it might mean.” (Ingrao et al.)
It means, first of all, that economists who stubbornly recycle refuted theories, i.e. Walrasians, Keynesians, Marxians, Austrians, and MMTers get an immediate and dishonorable discharge from the sciences.
Egmont Kakarot-Handtke
#1 Caught in secular intellectual stagnation
#2 Paul’s and Stephanie’s economic delirium talk
#3 Dear idiots, time to get saving and investment straight (II)
#4 MMT-Refutation for Dummies
Related 'Dead men tweeting' and 'Unsmart allocators' and 'Economists: Either stupid or corrupt or both'.
Labels: Austrianism, Ethics, Failure, Keynesianism,Macrofoundations, Marxianism, Microfoundations, Paradigm,Science, Theoretical Economics, Walrasianism, z#, zBE
March 2, 2019
MMT-Refutation for Dummies
Comment on Albert Edwards on ‘MMT for Dummies’*
Blog-Reference
Albert Edwards sets the frame: “MMT’s adherents often sell MMT as a prescriptive school of thought rather than a descriptive one. They come out of the gate with all sorts of big spending policy proposals they say are based on MMT. …
People need to understand how the economics fits together first. Then they can buy into the prescriptions. And even then, they may not buy the policy prescriptions MMT adherents hawk. For me, MMT is not about policy prescriptions, it’s about a description of how an advanced economy works for a fiat currency issuer.”
True. The problem is that MMTers do not know how the economy works. More precisely, they get the interaction of the macroeconomic balances wrong. The lethal blunder is in Wynne Godley’s contribution to MMT.
The FT’s Martin Wolf explained Godley’s insight this way…: “I look at this through the lens of ‘sectoral financial balances’, an analytical framework learned from the work of the late Wynne Godley. The essential idea is that since income has to equal expenditure for the economy, as a whole, (which is the same thing as saying that savings equals investment) so the sums of the difference between income and expenditures of each of the sectors of the economy must also be zero. These differences can also be described as ‘financial balances’. Thus, if a sector is spending less than its income it must be accumulating (net) claims on other sectors.
The crucial point is that, since sectoral balances must sum to zero, a rise in the deficit of one sector must be matched by an offsetting change in the others. It follows that if the fiscal deficit is increasing, the sum of the surpluses of the other sectors of the economy must be increasing in a precisely offsetting manner.”
Here is the short proof that economists in general and MMTers, in particular, get the elementary mathematics that underlies macroeconomics wrong.
(i) The elementary production-consumption economy is given by three macroeconomic axioms: (A1) Yw=WL wage income Yw is equal to wage rate W times working hours. L, (A2) O=RL output O is equal to productivity R times working hours L, (A3) C=PX consumption expenditure C is equal to price P times quantity bought/sold X.
(ii) The focus is here on the nominal/monetary balances. For the time being, real balances are excluded, i.e. X=O.
(iii) The monetary profit of the business sector is defined as Q≡C−Yw,
(iv) The monetary saving of the household sector is defined as S≡Yw−C.
(v) Ergo Q+S=0 or Q=−S.
The balances add up to zero. The counterpart of household sector saving S is business sector loss −Q. The counterpart of household sector dissaving (-S) is business sector profit Q. Both Q and S are measurable with the precision of two decimal places.
For the elementary investment economy holds Q=I−S.
For the elementary investment economy plus government holds Q=(I−S)+(G−T).
From this follows that (1) saving and investment are causally INDEPENDENT and NEVER equal, (2) all I=S/IS-LM models are false since Keynes/Hicks, (3) Keynesianism, Post-Keynesianism, New Keynesianism and all variants are scientifically worthless, (4) the foundational MMT sectoral balances equation (I−S)+(G−T)+(X−M)=0 is false because it lacks the balance of the business sector Q, (5) because profit is false, the whole of MMT is false, (6) because the theory is false, MMT policy guidance has no sound scientific foundations.#1
This holds also for Walrasianism, Keynesianism, Marxianism, Austrianism and all their variants. Because of this, all economic policy debates are devoid of sense.
Egmont Kakarot-Handtke
* Credit Writedowns
#1 For the full-spectrum refutation of MMT see cross-references MMT
Related 'Paul’s and Stephanie’s economic delirium talk' and 'Schizonomics' and 'Economists cannot do the simple math of profit — better keep them out of politics' and 'The demise of phony experts: macroeconomics is provably false' and 'There is NO such thing as an economic expert' and 'Economics, methodology, morals ― a creepy freak-show'.
Comment on Albert Edwards on ‘MMT for Dummies’*
Blog-Reference
Albert Edwards sets the frame: “MMT’s adherents often sell MMT as a prescriptive school of thought rather than a descriptive one. They come out of the gate with all sorts of big spending policy proposals they say are based on MMT. …
People need to understand how the economics fits together first. Then they can buy into the prescriptions. And even then, they may not buy the policy prescriptions MMT adherents hawk. For me, MMT is not about policy prescriptions, it’s about a description of how an advanced economy works for a fiat currency issuer.”
True. The problem is that MMTers do not know how the economy works. More precisely, they get the interaction of the macroeconomic balances wrong. The lethal blunder is in Wynne Godley’s contribution to MMT.
The FT’s Martin Wolf explained Godley’s insight this way…: “I look at this through the lens of ‘sectoral financial balances’, an analytical framework learned from the work of the late Wynne Godley. The essential idea is that since income has to equal expenditure for the economy, as a whole, (which is the same thing as saying that savings equals investment) so the sums of the difference between income and expenditures of each of the sectors of the economy must also be zero. These differences can also be described as ‘financial balances’. Thus, if a sector is spending less than its income it must be accumulating (net) claims on other sectors.
The crucial point is that, since sectoral balances must sum to zero, a rise in the deficit of one sector must be matched by an offsetting change in the others. It follows that if the fiscal deficit is increasing, the sum of the surpluses of the other sectors of the economy must be increasing in a precisely offsetting manner.”
Here is the short proof that economists in general and MMTers, in particular, get the elementary mathematics that underlies macroeconomics wrong.
(i) The elementary production-consumption economy is given by three macroeconomic axioms: (A1) Yw=WL wage income Yw is equal to wage rate W times working hours. L, (A2) O=RL output O is equal to productivity R times working hours L, (A3) C=PX consumption expenditure C is equal to price P times quantity bought/sold X.
(ii) The focus is here on the nominal/monetary balances. For the time being, real balances are excluded, i.e. X=O.
(iii) The monetary profit of the business sector is defined as Q≡C−Yw,
(iv) The monetary saving of the household sector is defined as S≡Yw−C.
(v) Ergo Q+S=0 or Q=−S.
The balances add up to zero. The counterpart of household sector saving S is business sector loss −Q. The counterpart of household sector dissaving (-S) is business sector profit Q. Both Q and S are measurable with the precision of two decimal places.
For the elementary investment economy holds Q=I−S.
For the elementary investment economy plus government holds Q=(I−S)+(G−T).
From this follows that (1) saving and investment are causally INDEPENDENT and NEVER equal, (2) all I=S/IS-LM models are false since Keynes/Hicks, (3) Keynesianism, Post-Keynesianism, New Keynesianism and all variants are scientifically worthless, (4) the foundational MMT sectoral balances equation (I−S)+(G−T)+(X−M)=0 is false because it lacks the balance of the business sector Q, (5) because profit is false, the whole of MMT is false, (6) because the theory is false, MMT policy guidance has no sound scientific foundations.#1
This holds also for Walrasianism, Keynesianism, Marxianism, Austrianism and all their variants. Because of this, all economic policy debates are devoid of sense.
Egmont Kakarot-Handtke
* Credit Writedowns
#1 For the full-spectrum refutation of MMT see cross-references MMT
Related 'Paul’s and Stephanie’s economic delirium talk' and 'Schizonomics' and 'Economists cannot do the simple math of profit — better keep them out of politics' and 'The demise of phony experts: macroeconomics is provably false' and 'There is NO such thing as an economic expert' and 'Economics, methodology, morals ― a creepy freak-show'.
Paul’s and Stephanie’s economic delirium talk
Links on Stephanie Kelton’s ‘Paul Krugman Asked Me About Modern Monetary Theory. Here Are 4 Answers.’
Blog-Reference and Blog-Reference on Mar 5
First answer: “Fiscal policy works by driving income into people’s pockets.”
False. Instead: “MMT deficit-spending/money-creation works by driving profit into rich people’s pockets.”
Stephanie Kelton is a scientifically incompetent agenda pusher for the Oligarchy:
► Stephanie Kelton’s legendary Plain-Sight-Ink-Trick
► The Kelton-Fraud
► Down with idiocy!
► Economists: Either stupid or corrupt or both
► How counterfeiters save America with an extra profit and make WeThePeople pay for it
► MMT for beginners
Paul Krugman, of course, is already a little longer known as a failed/fake scientist (see Related).
Egmont Kakarot-Handtke
Related 'Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It' and 'Krugman vs MMT ― like the blind talking about colors' and 'Economics: A pointless left-right wrestling show' and 'Krugman and the scientific implosion of economics' and 'Paul Krugman and economic poultry entrails reading' and 'Enough! Economists, retire now!' and 'Just another wreck' and 'The Krugman curse' and 'Krugman is not an economist' and 'Not a question of simplicity but of stupidity' and 'The general theory of scientific incompetence' and 'Is Paul Krugman necessary?' and 'When fake scientists call out on fake politicians' and 'On economists’ stupidity' and 'Paul the Menace' and 'Economics and corruption' and 'Forget Krugman, forget Keynes, forget economists' and 'Hooray! The formalization issue is finally settled' and 'Dear idiots, government deficits do NOT cause inflation' and 'MMT-Refutation for Dummies' and 'The clock runs down on economics'.
Links on Stephanie Kelton’s ‘Paul Krugman Asked Me About Modern Monetary Theory. Here Are 4 Answers.’
Blog-Reference and Blog-Reference on Mar 5
First answer: “Fiscal policy works by driving income into people’s pockets.”
False. Instead: “MMT deficit-spending/money-creation works by driving profit into rich people’s pockets.”
Stephanie Kelton is a scientifically incompetent agenda pusher for the Oligarchy:
► Stephanie Kelton’s legendary Plain-Sight-Ink-Trick
► The Kelton-Fraud
► Down with idiocy!
► Economists: Either stupid or corrupt or both
► How counterfeiters save America with an extra profit and make WeThePeople pay for it
► MMT for beginners
Paul Krugman, of course, is already a little longer known as a failed/fake scientist (see Related).
Egmont Kakarot-Handtke
Related 'Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It' and 'Krugman vs MMT ― like the blind talking about colors' and 'Economics: A pointless left-right wrestling show' and 'Krugman and the scientific implosion of economics' and 'Paul Krugman and economic poultry entrails reading' and 'Enough! Economists, retire now!' and 'Just another wreck' and 'The Krugman curse' and 'Krugman is not an economist' and 'Not a question of simplicity but of stupidity' and 'The general theory of scientific incompetence' and 'Is Paul Krugman necessary?' and 'When fake scientists call out on fake politicians' and 'On economists’ stupidity' and 'Paul the Menace' and 'Economics and corruption' and 'Forget Krugman, forget Keynes, forget economists' and 'Hooray! The formalization issue is finally settled' and 'Dear idiots, government deficits do NOT cause inflation' and 'MMT-Refutation for Dummies' and 'The clock runs down on economics'.
***
REPLY to Noah Way, Konrad, Detroit Dan, Ralph Musgrave, S400 on Mar 2
The notation of the sectoral balances equations is as follows
MMT (I−S)+(G−T)+(X−M)=0
AXEC (I−S)+(G−T)+(X−M)−(Q−Yd)=0.
Because the MMT equation is provably false (it describes a zero-profit economy), the whole of MMT is false. As a consequence, MMT and its proponents are flushed down the scientific toilet. This is how mental hygiene works. And this is how science works for 2500+ years.
Genuine scientists settle matters by material/formal refutation and then move on to a superior approach. To this day, economists are unable to get out of their proto-scientific delirium.#1 Paul Krugman, Stephanie Kelton and you are the living proof.
#1 Economists: Either stupid or corrupt or both
The notation of the sectoral balances equations is as follows
MMT (I−S)+(G−T)+(X−M)=0
AXEC (I−S)+(G−T)+(X−M)−(Q−Yd)=0.
Because the MMT equation is provably false (it describes a zero-profit economy), the whole of MMT is false. As a consequence, MMT and its proponents are flushed down the scientific toilet. This is how mental hygiene works. And this is how science works for 2500+ years.
Genuine scientists settle matters by material/formal refutation and then move on to a superior approach. To this day, economists are unable to get out of their proto-scientific delirium.#1 Paul Krugman, Stephanie Kelton and you are the living proof.
#1 Economists: Either stupid or corrupt or both
***
REPLY to Calgacus on Mar 2
People who invoke Jesus in an economic argument have disqualified themselves and are NOT allowed to utter any methodological pronouncements.#1
Obviously, you cannot stop making a fool of yourself: “Egmont, people are trying to make a point I have made in vain to you. These equations are meaningless if you don’t define your terms.”
Guess what, Calgacus and other people who invoke Jesus and cannot put 2 and 2 together: the variables in the AXEC sectoral balances equations are axiomatically well-defined, identical with the subset of the MMT equation, and measurable with the precision of two decimal places.#2, #3, #4, #5
So, if the subset of variables in the MMT equation is correctly defined then the same set of variables in the AXEC equation is also correctly defined. The AXEC set contains, in addition, the well-defined variables profit Q and distributed profit Yd which are missing in the MMT equation.
The problem of MMTers is that they do not even understand what their own balances equation actually says. It actually says that macroeconomic profit is zero.#6 Note that a zero-profit economy is a NONENTITY like the Easter Bunny or Spiderman or the Tooth Fairy or an intelligent MMTer.
#1 How counterfeiters save America with an extra profit and make WeThePeople pay for it, post of Feb 27
#2 From false micro to true macro: the new economic paradigm
#3 A crash course in macro accounting
#4 Wikipedia and the promotion of economists’ idiotism (II)
#5 The final implosion of MMT
#6 Dear idiots, time to get saving and investment straight (II)
People who invoke Jesus in an economic argument have disqualified themselves and are NOT allowed to utter any methodological pronouncements.#1
Obviously, you cannot stop making a fool of yourself: “Egmont, people are trying to make a point I have made in vain to you. These equations are meaningless if you don’t define your terms.”
Guess what, Calgacus and other people who invoke Jesus and cannot put 2 and 2 together: the variables in the AXEC sectoral balances equations are axiomatically well-defined, identical with the subset of the MMT equation, and measurable with the precision of two decimal places.#2, #3, #4, #5
So, if the subset of variables in the MMT equation is correctly defined then the same set of variables in the AXEC equation is also correctly defined. The AXEC set contains, in addition, the well-defined variables profit Q and distributed profit Yd which are missing in the MMT equation.
The problem of MMTers is that they do not even understand what their own balances equation actually says. It actually says that macroeconomic profit is zero.#6 Note that a zero-profit economy is a NONENTITY like the Easter Bunny or Spiderman or the Tooth Fairy or an intelligent MMTer.
#1 How counterfeiters save America with an extra profit and make WeThePeople pay for it, post of Feb 27
#2 From false micro to true macro: the new economic paradigm
#3 A crash course in macro accounting
#4 Wikipedia and the promotion of economists’ idiotism (II)
#5 The final implosion of MMT
#6 Dear idiots, time to get saving and investment straight (II)
***
REPLY to Bob Roddis, Andrew Anderson, Konrad, Noah Way
Your talk about greed and violence is folk psychology/sociology, or PsySoc for short. It may surprise you to learn that economics is NOT AT ALL about Human Nature/motives/ behavior/action.#1, #2
Economics is about how the economic system works. More precisely, economics deals with the objective systemic laws that govern the behavior of the monetary economy.
Economists, in an analogy, are like scientists/engineers who figure out the laws of aerodynamics, thermodynamics etcetera and manage in the end to get something heavier than air off the ground and safely to some distant destination. Except that economists have NOT figured out anything about how the economy works. Instead, they have for 200+ years now a brain dead palaver about utility maximization, rational expectations, animal spirits, supply-demand-equilibrium, greed, and other PsySoc BS.
To this day, neither MMTers nor Austrians nor Walrasians nor Keynesians nor Marxians get the interaction of the macroeconomic balances right.#3 So, economics is at a level analogous to physics before Archimedes had figured out the Law of the Lever about 2300 years ago.
Society is cursed with the fact that economic policy has to this day NO sound scientific foundations. What society got instead is incessant PsySoc blather at the intellectual zero lower bound.
#1 Economics is NOT about Human Nature but the economic system
#2 PsySoc — the scourge of economics
#3 MMT-Refutation for Dummies
Your talk about greed and violence is folk psychology/sociology, or PsySoc for short. It may surprise you to learn that economics is NOT AT ALL about Human Nature/motives/ behavior/action.#1, #2
Economics is about how the economic system works. More precisely, economics deals with the objective systemic laws that govern the behavior of the monetary economy.
Economists, in an analogy, are like scientists/engineers who figure out the laws of aerodynamics, thermodynamics etcetera and manage in the end to get something heavier than air off the ground and safely to some distant destination. Except that economists have NOT figured out anything about how the economy works. Instead, they have for 200+ years now a brain dead palaver about utility maximization, rational expectations, animal spirits, supply-demand-equilibrium, greed, and other PsySoc BS.
To this day, neither MMTers nor Austrians nor Walrasians nor Keynesians nor Marxians get the interaction of the macroeconomic balances right.#3 So, economics is at a level analogous to physics before Archimedes had figured out the Law of the Lever about 2300 years ago.
Society is cursed with the fact that economic policy has to this day NO sound scientific foundations. What society got instead is incessant PsySoc blather at the intellectual zero lower bound.
#1 Economics is NOT about Human Nature but the economic system
#2 PsySoc — the scourge of economics
#3 MMT-Refutation for Dummies
***
0 comments:
Post a Comment