The euro area is not running out of euros. Yet, it pretends it is.
By Warren Mosler and Andrea Terzi Technically, any central bank can spend or lend any amount of its currency with any of its member banks by simply crediting their accounts. This is the basis and the...
View ArticleInsanity spreads: Now, Japan pretends it is running out of yens!
According to Japan’s Finance Minister Azumi, Japan could be the next Greece! As Reuters reports, “Assuming that the deficit financing bill does not pass, the government would have only 46.1 trillion...
View ArticleA word on the explanatory power of MMT: The euro crisis explained before it...
Randy Wray is the author of this piece – giving credit to most of those who understood the fragility of the architecture of the common currency in Europe as soon as (or before) it actually started (in...
View ArticleCan Draghi persuade financial markets that sovereign spreads are unreasonable?
Not yet (if ever)! In an interview with Le Monde, also available from the ECB, Mario Draghi stated that “the euro is irrevocable!” One might think that “irrevocable” means that the euro is not simply a...
View ArticleEurozone countries trapped in their own net
Italy’s GDP was down 2.5% in the 2nd quarter of 2012. And the priority of the Italian government is, guess, debt reduction. Just like in all European states. This Chart shows that eurozone governments...
View Article14. Giving, receiving, and the currency
Real costs and real benefits In all societies people engage in giving and receiving real values: There are real costs in giving them, and there are real benefits in receiving them. In...
View ArticleBernanke on QE3: “Not a panacea”
by Andrea Terzi What’s the logic behind Ben Bernanke’s last announcement of more Quantitative Easing (QE)? The Fed sees QE as having effects on the price of assets (real property and stocks) so...
View Article‘Occupy Wall Street’ does charity, it does not save the economy.
By Andrea Terzi The Occupy movement deserves credit for rallying behind the foreclosed and protesting against fiscal retrenchment (aka ‘austerity’). But their last initiative is highly doubtful. They...
View ArticleThe Fed cannot control (and only accommodates) the quantity of banknotes in...
Read Quote of Andrea Terzi’s answer to Does the U.S. Federal Reserve have the power to regulate the total stock of dollar banknotes in circulation? on Quora
View ArticleThe Fed controls bank reserves to meet banks’ needs at its desired interest rate
Read Quote of Andrea Terzi’s answer to Does the US Federal Reserve have the power to control the total amount of reserves that banks hold as deposits at the US Federal Reserve? on Quora
View ArticleAn ECB paper using financial accounts finds MMT-flavored results
By Andrea Terzi Ulrich Bindseil and Adalbert Winkler have co-authored a consequential paper entitled Dual Liquidity Crises Under Alternative Monetary Frameworks: a Financial Accounts Perspective. As...
View ArticleThe Trillion Dollar Coin
This proposal was first discussed on Moslereconomics blog. It is now a petition to the White House. Anthony Coley, a spokesman for the Treasury Department, said the Treasury won’t mint this coin:...
View ArticleWhere does the money that government spends come from?
Read Quote of Andrea Terzi’s answer to The US government currently owes about $14.2 Trillion. Who did we borrow that money from, and how did those financiers get that money? on Quora
View ArticleDo exports LOWER a nation’s living standards?
By Andrea Terzi In the U.S. and (particularly) in euro countries, policies aimed at stimulating exports are (sadly) considered an effective response to lagging growth (U.S.) and recession (Euroland)....
View ArticleA narrow path ahead for Europe: And it’s France and Germany, again
By Andrea Terzi “French industrial production fell in January as Europe’s second-largest economy teetered on the brink of its third recession in four years.” The current euro predicament has its roots...
View ArticleOlli Rehn and ‘distinguished’ economists
By Andrea Terzi The European Commissioner for Economic and Monetary Affairs, Olli Rehn, has said: What I don’t understand is where on earth the stimulus money could have come from—I sincerely hope that...
View ArticlePro-cyclical austerity and rising unemployment in Europe: No surprise!
By Andrea Terzi On 18 August 2011, I had shared my concerns about the ECB’s approach to financial balances that seemed to reveal: a) a misunderstanding of how sector financial balances are logically...
View ArticleWarren Mosler – The Euro: Past, present and future
Speech given in Zürich, 25 March 2013
View ArticleWhy the Reinhart-Rogoff paper was flawed right from the start
By: Andrea Terzi At this point, it seems that everybody with an internet connection knows about Herndon, Ash, and Pollin’s (HAP) rebuttal of Reinhart-Rogoff’s (RR) paper on public debt and growth....
View Article2013 Mecpoc Lecture
The 2013 Mecpoc Lecture will be held on 25 November, 2013 in the Franklin Auditorium. David Colander, Distinguished Professor of Economics at Middlebury College, will lecture on Functional Finance,...
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