I have read and listened many materials from Steve Keen, and he insists in this argument that studying dynamic systems (plus using strict macroeconomic definitions) would make someone understand how the macroeconomy actually works.
The issue is that there are many macroeconomists who do study dynamic systems, and yet they don't arrive at MMT. The problem is much more fundamental. They don't understand how the modern monetary structure works, and there is no dynamic systems knowledge that can compensate that.
Thanks for the interview with Steve Keen. He's a very fast talker and hard to keep up with on such complex econ concepts, but worth listening to his critiques on neoclassical and neoliberal ideologies and viewpoints vs MMT. I wonder how he disagrees with Warren Mosler on Export/Import trade policies. He never elaborated. So glad his Ravel models agreed with Prof Kelton's conclusions on how money is created by the govt. His Ravel diagnostic tool really makes your head spin. He is very brilliant. I wish he and Prof Kelton had positions in US govt (democratic side) to teach and advise econ policy and rid them of their outdated neoliberal or neoclassical thinking. One of our most respected senator, Sen Cory Booker (D) who filibustered for 25 hrs, gave an interview in which he lamented that our children and grandchildren were going to have to pay for our debt if we do not start reducing or eliminating it and bringing down the deficit. He is a Rhodes scholar who could use Prof Kelton's help in understanding our monetary system and Dr. Keen's Ravel to prove it. Love your work. Keep it up. Learning more and more every day.
"If trade is necessarily matched by a promise to pay then, with the sole exception of a country that issues a reserve currency, the net value of the promises to pay that are outstanding in international markets will have a bearing upon the way in which those markets react to the issue of further such promises. If it is perceived that the country does not have the ability to fulfil its promise, then inevitably the value of the promises made will be reduced, and the currency will be deflated as a consequence. It is then simply not possible to argue that we can appraise the net benefit of the transaction purely on the basis of the physical movement of goods."
As I live in a small country (NZ) which is almost entirely reliant on trade for energy and manufactured goods & whose currency is the polar-opposite of a 'reserve currency', and which is at present battling a large trade imbalance and the resulting degradation of the value of it's currency, this seems most pertinent.
I agree with you Sandra. The default position taken by politicians equates with what their neoliberal economic advisers tell them. Which of course, is often nonsense.
He argues that for many developing nations, exports are crucial for industrial growth and for acquiring foreign currency - necessary to obtain imports. Relying heavily on imports can lead to deindustrialization and increased dependency on foreign imports.
I have read and listened many materials from Steve Keen, and he insists in this argument that studying dynamic systems (plus using strict macroeconomic definitions) would make someone understand how the macroeconomy actually works.
The issue is that there are many macroeconomists who do study dynamic systems, and yet they don't arrive at MMT. The problem is much more fundamental. They don't understand how the modern monetary structure works, and there is no dynamic systems knowledge that can compensate that.
Thanks for the interview with Steve Keen. He's a very fast talker and hard to keep up with on such complex econ concepts, but worth listening to his critiques on neoclassical and neoliberal ideologies and viewpoints vs MMT. I wonder how he disagrees with Warren Mosler on Export/Import trade policies. He never elaborated. So glad his Ravel models agreed with Prof Kelton's conclusions on how money is created by the govt. His Ravel diagnostic tool really makes your head spin. He is very brilliant. I wish he and Prof Kelton had positions in US govt (democratic side) to teach and advise econ policy and rid them of their outdated neoliberal or neoclassical thinking. One of our most respected senator, Sen Cory Booker (D) who filibustered for 25 hrs, gave an interview in which he lamented that our children and grandchildren were going to have to pay for our debt if we do not start reducing or eliminating it and bringing down the deficit. He is a Rhodes scholar who could use Prof Kelton's help in understanding our monetary system and Dr. Keen's Ravel to prove it. Love your work. Keep it up. Learning more and more every day.
Keen's long-time ally Richard Murphy says this.:
"If trade is necessarily matched by a promise to pay then, with the sole exception of a country that issues a reserve currency, the net value of the promises to pay that are outstanding in international markets will have a bearing upon the way in which those markets react to the issue of further such promises. If it is perceived that the country does not have the ability to fulfil its promise, then inevitably the value of the promises made will be reduced, and the currency will be deflated as a consequence. It is then simply not possible to argue that we can appraise the net benefit of the transaction purely on the basis of the physical movement of goods."
As I live in a small country (NZ) which is almost entirely reliant on trade for energy and manufactured goods & whose currency is the polar-opposite of a 'reserve currency', and which is at present battling a large trade imbalance and the resulting degradation of the value of it's currency, this seems most pertinent.
Keen has recently laid out his argument against Mosler here:
https://profstevekeen.substack.com/p/trade-tariffs-and-coming-up-trumps
Thanks :-)
I agree with you Sandra. The default position taken by politicians equates with what their neoliberal economic advisers tell them. Which of course, is often nonsense.
Re: trade andExport/Import trade policies
Keen mentions it here: https://realprogressives.org/mnc-podcast-ep/episode-180-the-end-of-dollar-diplomacy-with-steve-keen-and-michael-hudson/?utm_source=chatgpt.com
Transcript here: https://www.nakedcapitalism.com/2022/07/dollar-diplomacy-michael-hudson-and-steve-keen-on-real-progressives.html?utm_source=chatgpt.com
He argues that for many developing nations, exports are crucial for industrial growth and for acquiring foreign currency - necessary to obtain imports. Relying heavily on imports can lead to deindustrialization and increased dependency on foreign imports.
Nice to connect. Kathie