Thursday, March 10, 2011
Simple Economics
The government should, in general, increase the money supply over time to support the growing economy. The way it does this is by deficit spending. The alternative is that the private creates more money via loans, but this does not increase the net financial assets of the private sector, since all new money is then offset by new liabilities. Inevitably, private debt gets too high and there is a deflationary collapse, unless the government steps in with a bailout. Better to get the deficit spending up front, rather than bailing out those who made the biggest mistakes...
Subscribe to:
Post Comments (Atom)
To Our Children's Children's Children Once More
This is my occasional confession of my true view of our world and what we might do to steer our ship in a better direction. I'm sendi...
-
Why I'm a Putin Apologist Introduction I recently declared myself a "Putin apologist" in a heated debate with a friend on th...
-
Because I'm having formatting issues with Blogger, please see this post in Google Docs: Ukraine Timeline
-
Prediction: The year 2000 will some day soon be considered the acme of unfettered capitalism. The Bush legacy will be clear -- his adminis...
No comments:
Post a Comment