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Economics Inequality Money and Banking

IS-LM and Making Sense of MMT

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 […]

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Business and Society Economics Money and Banking

The Production of Money: How to Break the Power of Bankers – by Ann Pettifor

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 […]

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Economics Money and Banking News

The Fragility of Bitcoin

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 […]

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Economics Money and Banking Politics

Bad Targets for Policy 1: Government Debt

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 […]

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Business and Society Economics Money and Banking

A Banking Debate

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 […]

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Business and Society Economics Money and Banking

Smaller, Greener Banking: A Response to FOE Scotland’s Report

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.’ […]

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Business and Society Economics Money and Banking

‘Chasing Goldman Sachs’ by Suzanne McGee – A Review

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 […]

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Business and Society Economics Money and Banking

Understanding Money

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.   […]

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Economics Money and Banking

Money and the Neo-classics… Again

‘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 […]

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Business and Society Economics Inequality Money and Banking

Unemployment – Morality, Money and Increasing Returns

The causes of unemployment make it a moral issue. Radical solutions are required. In an earlier post I noted some features of unemployment from a UK perspective. The main thrust was that a fairly constant proportion of the population in employment (around 72% of those of working-age) hides a serious decline in the availability of […]