Another supply-side gold bug claiming things about MMT that it doesn’t say or advocate. Please supply a link to one MMT economist you’ve read and understood. I’m betting you can’t and just want to vent about some imaginary history that doesn’t come close to reality.
In case you missed it, there was no “money printing” by the government connected to the ’08 crash. It was all banks and their ability to place the economy in jeopardy via Clinton era deregulation. Banks don’t lend from reserves, so no, QE did little to incentivize lending.
Banks lend “credit” to qualified borrowers and their reserve position is always matched to the demand for loans by those borrowers. The purpose of those reserves created in the system is to allow interbank transfers and they are depleted from the system as borrowers pay down principal. One cannot “NET” retire debt with credit money or “NET” save it as a store of value. Only money created by Congress can do either.
Most MMT economists credit Clinton’s surplus budgets for both the late 90s recession and the ’08 crash, as drawing down the money supply in the private sector forced people to leverage their private debt, mostly using their home equity as ATM cards. Since budget surpluses don’t generate Treasury bonds investors were looking for secure parking for their money and the US mortgage market was well known for its stability, before those same investors began creating shaky investment instruments that the market value couldn’t cover should they go south. Wall St will always run with scissors without adult supervision.
Since credit money cannot retire the debt that created it only a minor hiccup in the business cycle makes making payments difficult in overleveraged credit markets and the house of cards begins crumbling at the base. Once it begins falling the government has no option but to expand fiscal policy as automatic stabilizers kick in to protect supply chains.
Please note that no one followed the money to attempt to claw back any of the losses already paid out in ridiculous salaries and gambling wins by the banks and Wall St. That was because it isn’t breaking any laws to break the American economy, which is entirely a product of conservative anti-gubmint ideology.
I would be more than happy to supply links to very credible economists explaining MMT if I thought you had any interest in actually learning and not just snarking with the constant bubbling just below the surface rage about things you don’t understand conservatives have become known for.
