Cryptocurrency – more fiat than ‘Fiat’ I have previously written about Bitcoin, explaining why I don’t believe it has any future as a replacement for so-called ‘fiat’ currencies. There are various reasons I cited for this, the most important being that actual state-backed currencies are not ‘fiat’ at all. They are not given value simply […]
IS-LM and MMT The core issue at the heart of debates between the heterodox Modern Monetary Theory (MMT) approach and more mainstream macroeconomics is how the financial economy and the real economy interact. As a consequence we see Keynesians of various hues attempting to illustrate their response to MMT with the standard orthodox Keynesian IS-LM […]
Ann Pettifor is a director of Prime Economics, which advocates for a more Keynesian view of macroeconomics, and has been involved in development and environmental economics for many years. In The Production of Money: How to Break the Power of the Bankers (Verso, 2017) she correctly identifies that ‘money enables us to do what we can […]
Launched in 2009, and of wider interest since 2013, the ‘cryptocurrency’ Bitcoin has seen both a rise in its value in relation to existing national and supranational currencies, and in the discussion of its forming a partial or even complete replacement to those currencies. This article outlines the nature of Bitcoin and of traditional currencies […]
This is the first blog in a two-part series on ‘Bad Targets for Policy’. The second in the series will be on immigration. We’ve seen a lot of focus on the ‘costing’ of policies in the parties’ manifestos for the forthcoming UK election. But we must remember that money is only a means of keeping […]
Introduction Since the financial crisis of 2007-8, one suggested target reform has been the monetary system itself. This reform is based on the recognition that money in the modern economy is a rather peculiar phenomenon. There are two popular conceptions of the nature of money, both of them incorrect. (Note that when we talk about […]
Response to Smaller, Greener Banking: Banking for Sustainability in a New Scotland: A Discussion Paper by Ray Perman and Friends of the Earth Scotland The authors of this report claim that ‘there has been a failure of government policy to decide the role banks should play, and therefore what sort of institutions they should be.’ […]
A Review of ‘Chasing Goldman Sachs: How the Masters of the Universe Melted Wall Street Down…and Why They’ll Take Us to the Brink Again’ by Suzanne McGee (2010, Crown Business) This book is an excellent complement to the academic stuff I’ve read on the causes of the financial crisis. These latter accounts are very detailed […]
Understanding Money – a non-technical account of the essential role money and its creation plays in a modern economy. This article was previously available as a pdf, but I have now posted it as a blog in its own right. Since it was originally written in 2010, I have made a few revisions and additions. Introduction […]
‘Aggregate Demand, Idle Time, and Unemployment’ – A Critique of Michaillat and Saez Introduction Like all neoclassical models, that of Michaillat and Saez (2014) referred to in Simon Wren-Lewis’s Mainly Macro blog on 16th August fails to model money realistically. This renders their model incoherent and in any case incapable of encompassing one of the […]