Exchange on RWER Blog Regarding The Solutions A New Monetary Paradigm Would Effect

GH:   I agree with Sylls and Skidelskiy that attributing fluctuations in aggregate demand to price stickiness is wrong-headed. Trying to manage counter-cyclical policy exclusively via manipulating interest rates has also not been a success. It failed to defuse the speculative excess leading to 2008 and has been ineffective in stimulating demand for anything except financial assets subsequently. Do we need to repeat criticisms of representative agent theorising which is theoretically nonsensical and empirically vacuous?
But there are unsolved problems that will not be cured by sacrificing to the great god Keynes. How do you prevent Minsky-style speculative excess as in 2004-7? Minsky’s solution was nationalisation of investment. How can it be managed in a mixed economy? And if we ever get back to a world without demand deficiency, how will we resolve the Kalecki problem of needing periodic recessions to prevent inflation speeding up?
Advances in macroeconomics will come from addressing real problems imaginatively not by rehearsing old theoretical disputes or worshipping at the shrine of the mighty dead.

Me:   “How do you prevent Minsky-style speculative excess as in 2004-7? Minsky’s solution was nationalisation of investment. How can it be managed in a mixed economy?”

The obvious solution is to end the monopoly charter to create our money by private for profit banks, rationally and strategically integrate monetary gifting into commerce and make banking and finance a public utility like we used to do with other natural monopolies like water and electric systems. No more derivative nonsense, no more casino capitalism and no more anti-social currency speculation.

“And if we ever get back to a world without demand deficiency, how will we resolve the Kalecki problem of needing periodic recessions to prevent inflation speeding up?”

A 50% discount/rebate price and monetary policy at the point of retail sale will forever end inflation, and SEVERELY taxing arbitrary and anti-social price rises while scorning and boycotting such perpetrators to the general populace whose purchasing power and hence monetary security has been insured by that policy will expose their lack of good will.

Not seeing/refusing to look at the gracious power of the new monetary and financial paradigm and its aligned policies is erudite duncie-ness.

The keys to paradigmatic insight are conceptual simplicity and seamless depth of temporal effect in the area of human endeavor the new paradigm applies to. We should be heeding those instead of ENDLESSLY regurgitating critiques as you and others yourselves have recently remarked here.

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