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Screaming into a Hole About Government Debt Should Read Screaming into a Hole About NUANCES OFGovernment Debt

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The nuanced part is the killer because people need cut and dry facts. When talking fiances, they understand either they have money or they don’t. The public via the individual sectors ability to raise funds is very limited. However, the corporate sector have many avenues and the language differs of those routes differs greatly.
Main street loan… I pawned my watch.. Wall Street loan, I issued bonds…
There are just so many metrics at play here with instruments of moneyness it’s difficult to congeal them into a simple narrative concept that will be acceptable to a public who struggles with a narrative that causes cognitive dissonance because of years of misinformation.

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Posted by Cowpoke
Posted on 09/14/2017 12:27 AM
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“money” is a very complex concept. We want to describe money as being one thing like cash or deposits. But the reality is that all of these financial assets have a certain degree of moneyness. A cash note is basically a physical T-Bill. A T-Bill is just a shortre duration version of a T-Bond. A T-bond is just a more credible version of a AAA rated corporate bond. A corporate bond is just a specific type of debt contract issued by a corporation that is very similar to common stock. So all of these instruments are interrelated and have varying degrees of moneyness which makes it all very hard to understand. And that’s before you even get into the nuances of the accounting…..So yeah, it’s a dense topic which explains the widespread confusion.

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Cullen Roche Posted by Cullen Roche
Answered on 09/14/2017 2:48 PM
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    I feel your pain Cullen. I have passed on your papar explaining our monetary system, only to have the individuals accuse me of having drunk some kind of kool-aid.

    Very tough sell

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    Posted by mpstrunk
    Answered on 09/14/2017 5:45 PM
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      @mpstrunk
      SO TRUE, just look at a few slams I have had the last few days:
      “I’ve read your link before. MMT is 100% wrong and fiction. You can believer in that fantasy if you want but it has been thoroughly debunked and destroyed.”
      That link was to Cullen’s CRITIQUE of MMT

      “Great, another MMT’er shows up to spew more nonsense.”

      Simply because I say the US is not like Greece..LOL

      One fellow did have this to say a week or so ago:
      “Thanks for the good discussion…………………………………..Not making much sense…(but followed with) Appreciate the civility and your good points.”
      So I guess just keep trying.
      🙂

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      Posted by Cowpoke
      Answered on 09/15/2017 8:18 AM
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        FYI, I hear you!

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        Posted by Digital Ghost
        Answered on 09/17/2017 9:23 AM
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          I was talking to some guys on the Seeking Alpha website who responded to this article in the comments. We were going back and forth and I was posting links to my myths and stuff. They just don’t get it. The conversation has devolved into a debate about whether taxes are theft. Yes, that’s right. These guys actually believe that taxation is theft because it’s involuntary. Yes, and the govt “stole” your right to murder your friends because you didn’t choose to have murder laws introduced.

          This is the level of dumb we’re dealing with with a huge portion of the electorate. They can’t even get past the most basic irrefutable facts about how the economy operates. And so things like government accounting, the Federal Reserve, etc are beyond hope….

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          Cullen Roche Posted by Cullen Roche
          Answered on 09/17/2017 3:58 PM
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            I have been to many countries throughout the world and it has been my experience that there is a country in the world that operated to whatever economic view one thinks is best. I recommend that those whom believe that a minimal/low taxation and regulation society is best – visit India or even the Democratic Republic of the Congo and see first-hand how their society operates. One can marvel at the open sewers, poorly maintained roads, an unreliable electrical grid, public water that is undrinkable, sample unsanitary food and interact with a largely uneducated population. Be careful for what you ask for…

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            Posted by Digital Ghost
            Answered on 09/17/2017 9:54 PM
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              The other day I read an article (but didn’t bother with the video portion) on Reason about the federal debt, wherein John Stossel wrote “Soon, warns economist Ed Stringham, we’ll be like Greece; forced to make sudden cuts because we cannot borrow more to finance our spending addiction.”

              I couldn’t let that one go, so I emailed professor Stringham at Trinity College, suggesting Greece was perhaps not the right example to use when describing concerns about federal debt in the USA because Greece was a currency user, not a currency issuer.

              He was kind enough to respond with: “Thanks for the note. I agree with your worries about the possibility of overissuing currency leading to inflation. I also agree that we can issue money in a way that Greece cannot.”

              “But having a high amount of debt (as compared to GDP) still matters for countries that can or cannot issue currency. It still will need to be paid, inflated away, or defaulted on in certain ways. Those debts don’t simply disappear and either the taxpayer who has to pay such high debt or the people who own the debt or people who own the currency that is inflated away will lose.”

              So – there you have it, another expert opinion about high federal debt eventually becoming a serious problem for the USA. Dr. Stringham seems convinced we will experience hyperinflation.

              Perhaps I will email Dr. Stringham a link to Cullen’s research paper on hyperinflation.

              Here’s a link to the Reason piece: https://reason.com/reasontv/2017/09/12/national-debt-and-rising

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              Posted by Steve W
              Answered on 09/18/2017 2:08 PM
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                Sounds like he thinks the money needs to be repaid. That’s just a big fallacy of composition. It’s unfortunate that people with a PhD in economics carry more credibility than someone like me who has started companies, worked with trading desks, managed money and actually operated in the financial field as a full-time professional. I know a lot more than these people do because I’ve been in the bunkers where the guys actually need to know how things work or they get fired. Instead we live in a world where the equivalent of war historian is chosen to opine on the battle plan rather than relying on a seasoned general with actual war experience.

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                Cullen Roche Posted by Cullen Roche
                Answered on 09/18/2017 2:24 PM
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                  A Google search for professor Stringham brings up some telling points. He is an “Austrian School American Economist” and his field is “political economy”. No wonder he does not have a good grasp on the operational side of our monetary system.

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                  Posted by Steve W
                  Answered on 09/18/2017 5:10 PM
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