Simpler explanation of Treasuries as saving account : Warren Mosler

[sishya]

I came across this video by Warren Mosler who explains how US Govt just keeps moving money between accounts via taxation and Treasury auctions.
And on how deficeits are Good for you. simpler explanation, by this analogy we should always be in a Bull market ?

He also sounds smart and not talking his positions.

I googled this person's name, but still trying to understand from where he comes from ?

[sishya]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

Looks like Mosler is aligned with Richard Koo. Remember Dick Cheney - " Deficeits don't matter"

"warren mosler Says:
January 13th, 2009 at 5:56 pm They are a bunch of ‘deficit terrorists’ that imply there is a solvency problem, rather than just an inflation problem.


In fact, most of them don’t think there is an inflation problem.


All govt spending is via data entry. there is no distinction between printing money and any other kind of govt. spending. They act as if there is a choice and govt. usually spends one unspecified way and gets in trouble when it relies on the printing press- total nonsense.


The reason why there’s so little inflation given the level of deficit spending is ’savings desires’ meaning desires to not spend income.
this comes from the tax advantaged savings plans- pensions, ira’, corp reserves, etc. that act as ‘demand drains’ and unless offset by deficit spending from some sector result in excess capacity/unemployment, etc.



see ’soft currency economics’ at this sight under ‘mandatory readings’ thanks!"

May be EJ can give some review on Mosler's thoughts.

[pb123]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

He belongs to a band of economists who have a chartalist view on how the monetary system works. The other proponents are Bill Mitchell , Randy Wray , Scott Fullwiler. I dont think they have any political leanings. You may like to read Bill Mitchells blog here

http://bilbo.economicoutlook.net/blog/

[slippery]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

He belongs to a band of economists who have a chartalist view on how the monetary system works. The other proponents are Bill Mitchell , Randy Wray , Scott Fullwiler. I dont think they have any political leanings. You may like to read Bill Mitchells blog here

http://bilbo.economicoutlook.net/blog/

Except that, unlike chartalists, he seems to think our current system can run infinite deficits while borrowing money from the Federal Reserve at interest. In the chartalist view, money is printed directly by the sovereign and not borrowed from a central bank.

Even in a chartalist world, creating money faster than production creates inflation or asset bubbles.

[c1ue]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

Since there are no links and the frame seems to be not working, it is not clear if the Warren Mosler in question is the same Warren Mosler as:

http://www.meetwarren.org/

Economic Issues
Warren & his followers have critics!!!

Critic 1

Here, this rather ignorant economics groupie reveals his "Moslerist" credentials. Aping his mentor, Warren Mosler, contrary to facts in the real world,
Source
http://www.groupsrv.com/science/viewtopic.php?t=51860

Critic 2

But then Tom goes onto to explain why fiscal stimulus is some sort of prerequisite for staying at full employment, something he and Warren Mosler have argued before. Again Brad DeLong noted how silly their argument is often phrased. Never mind that no economist Keynesian or classical believes [them]. Then again we must remember the rightwing agenda of Mosler&Nugent, which seems to be trying to deny that long-term fiscal stimulus crowds out investment thereby reducing economic growth.
Source
http://angrybear.blogspot.com/2004/0...economics.html

If it is indeed the same Warren Mosler - an idiot and a tool of FIRE.

[ThePythonicCow]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

Since there are no links and the frame seems to be not working, it is not clear if the Warren Mosler in question is the same Warren Mosler as:

http://www.meetwarren.org/

It appears to be the one and the same Warren Mosler. Several web pages describe this person, some including his photo, which matches the CNBC video clip in Post #1 above (that clip worked fine for me.) For example, compare Warren B. Mosler for Congress with your http://www.meetwarren.org/ link. Both mention AVM, III, Valance, and St. Croix (in the Virgin Islands). The above CNBC video introduces Mr. Mosler as "a founder partner of AVM Securities", further cementing this linkage.

He's a tool alright (no disrespect to Klein wire cutting tools intended .) He's a salesman. From the look of the impressive sounding biographical clips on various "social networking" sites and from his economic B.S. on this clip, I presume that the primary product he's selling is one Mr. Warren B. Mosler.

[ThePythonicCow]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

Even our most esteemed economics maestro "Mish" has no respect for this Mr. Mosler. Mish links to this same CNBC video at Warren Mosler: The Obvious Answer To The Problem Is "Print Money", concluding his brief comments with:

I am in awe of such stupidity.

[ThePythonicCow]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

He also sounds smart and not talking his positions.

My take is that he -is- talking his position; his position is himself. He's a self-promoter. He also has a nice tan and likes fast cars.

There's an earlier thread discussing another work by this "piece of work" at Fiat Money.

I'd suggest this thread belongs in the Junk Economics forum of iTulip .

[sishya]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

I am reading this entries in http://moslereconomics.com. Probably get a
handle on what his mind says.

But so far, his view seems to correlate with actual events as well as with EJ.

- Govt only needs to create excess money in accordance to Interest paid
on Treasuries. There is no fast jump in money supply.


- There is only a small rate of Inflation which I guess grows according to
GDP growth. The only time, I can see a faster change in money supply is
when FED bought Bank Loans at par 100% value. This creates excess
money in the system which will cause inflation in the future when Banks
lend these 1 trillion reserves out.

- This FED paying 100% on loans helped stabilize the system.

- China buys Treasuries using our money we spend on things made in China.
What will china do next since they will have to fear money dilution
because banks have been given free money. They will have to look for
better return. I think they have to start investing in US companies.


- Also FED has to find a way to allow a slow release the Bank reserves into
the system "slowly" to prevent a "fast" inflation.

- People are tying up their money in saving account, Companies and People
are paying down debt( showing velocity of money dropping ), which they
are unlocking via budget deficeit, Treasury issuance to China and US bond
buyers. This public debt growth compensates private debt contraction, so
that economy does not contract.

- From mosler's reasoning, it then looks like things are always in a perpetual
Bull market.

How do we apply these to real world incidence.

- Why could Japan not escape from this catch 22 via public debt issuance.
I think it could be because they could not get their society to start
using their money to move from public debt to private enterprise. This
could have been both a cultural issue as well as a "demographic"
problem : popluation shrinking.

- So if this is right, Banks have been made whole again. Their loans are now
owned by FED/Govt. So now there is more money in the system, where
as real estate values have shrunk by 40%, this will definitely jump start
the economy and Bank loan issuance should increase unless FED wants to
restrain inflation

- Gold should do good as per above scenario also if real interest rate is still
negative. This negative rate is helping the economy but will hit badly
the savers.

- Why was US not able to escape the 1930's depression : why were people
afraid to take risks after the depression, From what I know there was no
population shrinkage- was it the external Trade Gold standard ? Internal
Gold holding was banned in US then, but still paying foreigners with Gold
is still a pain and hence money supply and loan write off could not have
been done to help the economy.


- Then the only competition to Treasuries is Gold. With Treasuries US Govt
can fully control the economy to soften crashes, but If people turn to
Gold then Gold discovery/mining will control inflation or deflation.

[ThePythonicCow]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

I am reading this entries in http://moslereconomics.com. Probably get a
handle on what his mind says.

But so far, his view seems to correlate with actual events as well as with EJ.

My first blush reaction is that this focuses way too much on the quantity of money afloat, and way too little on the opportunities for engaging in productive labor, earning a good wage somewhat in proportion to one's productivity, investing in productive enterprises and exchanging goods and services in a robust market.

Can you imagine what it would be like if the value of the kilogram (or British pound) weight could be manipulated by powerful inside interests? All those fat cat bankers could go on a diet kick by manipulating the measures of weight.

Wow -- I'm only 60 pounds! A decade ago I was 300 pounds. (Nevermind that my tailor has had to let out my pants several times in the interim.)

Such a farce can only continue until death by some disease of obesity.

The goal should be health, not improving numbers on a manipulated metric.

The current economic farce can only continue until the excess debt defaults.

[jtabeb]

Re: Simpler explanation of Treasuries as saving account : Warren Mosler

My first blush reaction is that this focuses way too much on the quantity of money afloat, and way too little on the opportunities for engaging in productive labor, earning a good wage somewhat in proportion to one's productivity, investing in productive enterprises and exchanging goods and services in a robust market.

Can you imagine what it would be like if the value of the kilogram (or British pound) weight could be manipulated by powerful inside interests? All those fat cat bankers could go on a diet kick by manipulating the measures of weight.

Wow -- I'm only 60 pounds! A decade ago I was 300 pounds. (Nevermind that my tailor has had to let out my pants several times in the interim.)

Such a farce can only continue until death by some disease of obesity.

The goal should be health, not improving numbers on a manipulated metric.

The current economic farce can only continue until the excess debt defaults.

EJ's "Economic FOG"