Bob,

Your thinking is macro-economically sound, but remember if we are to have a complete micro and macro-economics they must be integrated in order for there to be a third and more unified theory. The ruling theory DSGE/neo-liberalism/the neo-classical synthesis claims to be such but all the leading edge thinking shows us that these are an emperor without any clothes. Micro-economics is ruled by cost and utterly embedded in Time and so is subject to disequilibrium by additional costs like depreciation, extraction and diminutions of income like savings and re-investments and time…lags in such disequilibrium that cannot be equilibrated by the current means of increasing both money and individual income, i.e. ONLY lending and borrowing at interest. Interest is one cost, but not the totality of additional costs and/or diminutions of money/income from the circular flow. This results in there being much more total money in the system…than there is, moment to moment, individual incomes with which to liquidate both the total money costs (principle and interest) and the additional costs of depreciation and the diminutions as per above. This basic micro-economic insight is what is missed by theorists, and is macro-economically resolved by policies of monetary grace/Gifting directly to the individual (the Dividend) and also reciprocally within the system (the rebated back to merchants retail Discount to consumers).