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Response to Demeter (Reply #2)

Thu Feb 14, 2013, 07:15 AM

20. Ms. Brown goes straight to the heart of the matter. The message needs to go viral.

... (H)anding out newly created money to citizens and governments could solve economic woes globally and would not lead to hyperinflation.

Government-issued money would work because it addresses the problem at its source. Today, we have no permanent money supply. People and governments are drowning in debt because our money comes into existence only as a debt to banks at interest...

... The threat of price inflation is the excuse invariably used for discouraging this sort of "irresponsible" monetary policy today, based on the Milton Friedman dictum that "inflation is everywhere and always a monetary phenomenon." When the quantity of money goes up, says the theory, more money will be chasing fewer goods, driving prices up.

What that theory overlooks is the supply side of the equation. As long as workers are sitting idle and materials are available, increased demand will put workers to work creating more supply. Supply will rise along with demand, and prices will remain stable.

True, today these additional workers might be in China, or they might be robots. But the principle still holds: if we want the increased supply necessary to satisfy the needs of the people and the economy, more money must first be injected into the economy. Demand drives supply. People must have money in their pockets before they can shop, stimulating increased production. Production doesn't need as many human workers as it once did. To get enough money in the economy to drive the needed supply, it might be time to issue a national dividend divided equally among the people...

/... http://www.truth-out.org/news/item/14513-how-congress-could-fix-its-budget-woes-permanently


... With the proviso that not just any kind of supply will do to meet the pent-up demand. New supply must come from economic activity healthy for the environment as well as for humanity.

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Arrow 47 replies Author Time Post
Tansy_Gold Feb 2013 OP
Demeter Feb 2013 #1
Tansy_Gold Feb 2013 #5
siligut Feb 2013 #10
tclambert Feb 2013 #19
Demeter Feb 2013 #2
Demeter Feb 2013 #4
Demeter Feb 2013 #6
LineLineReply Ms. Brown goes straight to the heart of the matter. The message needs to go viral.
Ghost Dog Feb 2013 #20
Ghost Dog Feb 2013 #36
Ghost Dog Feb 2013 #43
Demeter Feb 2013 #3
Demeter Feb 2013 #7
Demeter Feb 2013 #8
Demeter Feb 2013 #11
jtuck004 Feb 2013 #9
Hugin Feb 2013 #12
Demeter Feb 2013 #13
Hugin Feb 2013 #34
Tansy_Gold Feb 2013 #17
Hugin Feb 2013 #35
kickysnana Feb 2013 #21
Hugin Feb 2013 #25
DemReadingDU Feb 2013 #39
Ghost Dog Feb 2013 #46
Roland99 Feb 2013 #44
Hugin Feb 2013 #45
Demeter Feb 2013 #14
Demeter Feb 2013 #15
Demeter Feb 2013 #16
Demeter Feb 2013 #18
kickysnana Feb 2013 #22
xchrom Feb 2013 #23
Hugin Feb 2013 #37
Demeter Feb 2013 #38
siligut Feb 2013 #40
DemReadingDU Feb 2013 #41
Fuddnik Feb 2013 #42
xchrom Feb 2013 #24
xchrom Feb 2013 #26
Ghost Dog Feb 2013 #31
xchrom Feb 2013 #32
xchrom Feb 2013 #27
xchrom Feb 2013 #28
xchrom Feb 2013 #29
xchrom Feb 2013 #30
bread_and_roses Feb 2013 #33
jtuck004 Feb 2013 #47
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