tag:blogger.com,1999:blog-6245381193993153721.post5178614709693538156..comments2024-03-28T17:08:15.784-07:00Comments on Social Democracy for the 21st Century: A Realist Alternative to the Modern Left: Who Owns the US Public Debt?Lord Keyneshttp://www.blogger.com/profile/06556863604205200159noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-6245381193993153721.post-67834040585572307672011-09-06T00:07:22.434-07:002011-09-06T00:07:22.434-07:00The whole thing is nothing but a fraudulent scheme...The whole thing is nothing but a fraudulent scheme to claim the national debt is being paid down when in fact it isn't.<br /><br />It's about the same as if I had borrowed and owed $100,000.00, and wanted/needed to get more money ($1,000.00) to buy something else I wanted. To get that extra money, I borrow $1000.00 from you in liew of a note saying I'll pay you back the money plus a little interest, at some point in time. Then, later, I need to pay you back, but don't have the money to do it because I now owe $1100,000.00, so I take out a piece of paper, create a fake $1000.00 bill and give it to you as payment to buy my note back from you.<br /><br />Same thing happens in the case of the government printing money it doesn't have assets/securities to back it with. The government gets the notes back, but because they paid to get the notes back with money they didn't have securities to cover, they still are in debt by that same figure. At some point in time, the government is going to have to pay to get the excessive money they printed out of the market, or the values of the money will just keep plummeting. As it is now, our Dollar has lost almost 40% of the buying power it used to have because of these schemel.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-68183557441263764712011-08-09T22:47:47.094-07:002011-08-09T22:47:47.094-07:00Izzy - you are right, there is no real reason for ...Izzy - you are right, there is no real reason for having a central bank outside the Treasury, and that is how the US did it for most of its history. The Fed & the 1st & 2nd Banks of the US are the exception.<br /><br />Running it this way has been found to be the best way to perform confusing but usually meaningless financial manipulations. Shell games to persuade people that up is down, being in debt is wealth and holding debt is poverty, and to distract them from the real frauds going on - the lack of regulation of and even welfare for Wall Street criminals.Calgacushttps://www.blogger.com/profile/06031818010224747000noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-69699973471859008012011-08-09T10:15:49.029-07:002011-08-09T10:15:49.029-07:00Correction:
"The amount of debt issued TO th...Correction:<br /><br />"The amount of debt issued <b>TO</b> the private sector "Lord Keyneshttps://www.blogger.com/profile/06556863604205200159noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-75097077961475148482011-08-09T10:14:53.077-07:002011-08-09T10:14:53.077-07:00I would prefer to see a government with a treasury...I would prefer to see a government with a treasury/central bank run on Post Keynesian/MMT lines.<br /><br />You would still issue bonds to control interest rates and to provide safe financial assets to the financial sector and people who do not wish to gamble their money in stocks and shares.<br /><br />The size of the stock of government debt would be limited by Abba Lerner's functional finance model.<br /><br />When expansionary policies are necessary you run a deficit; when contraction is needed you run a surplus.<br /><br />The amount of debt issued by the private sector is decided the central and treasury.<br /><br />Bill Mitchell describes how the system would work in the FAQs:<br /><br />http://bilbo.economicoutlook.net/blog/Lord Keyneshttps://www.blogger.com/profile/06556863604205200159noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-5926974798918737472011-08-09T10:05:52.245-07:002011-08-09T10:05:52.245-07:00LK,
But why advocate or encourage such policy? se...LK,<br /><br />But why advocate or encourage such policy? seems like an unnecessary process. Why doesn't the government just cancel its repayment to itself?Isaac Izzy Marmolejohttps://www.blogger.com/profile/11954588809878738480noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-1721237402950937392011-08-09T09:05:44.999-07:002011-08-09T09:05:44.999-07:00"So are you saying that the government should...<i>"So are you saying that the government should repay itself from money they create? "</i><br /><br />It already does: the interest on Fed-held bonds DOES go back to the Treasury, so your question is confused.Lord Keyneshttps://www.blogger.com/profile/06556863604205200159noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-86782652136593957172011-08-09T08:43:31.882-07:002011-08-09T08:43:31.882-07:00LK,
So are you saying that the government should ...LK,<br /><br />So are you saying that the government should repay itself from money they create? If so, why go through all that trouble instead of just cancelling the whole repayment since it is money it owes itself?Isaac Izzy Marmolejohttps://www.blogger.com/profile/11954588809878738480noreply@blogger.com