Keynes, who was a contemporary of Douglas, was “chosen” by the banking and financial elite as the fall back position to save themselves after the last time around led to economic stagnation and then world war. Why? Because they knew it would enable them to remain in control. Then as General Equilibrium theory became the ruling economic ideology all manner of “creative” financial instruments became palatable and the rest is history.

Keynes who at least had an understanding of accounting should have known better, but not ever having been a businessman had no actual reality on the significance of the data in its subset, cost accounting, and so missed the ever present and dynamic cost inflationary truth its convention that “all costs must go into price” enforced.

Douglas was right 90 years ago, he’s still right and my Wisdomics/Gracenomics is the modern, cleansed of orthodoxy (even in Social Credit) extension of his thinking.

wisdomicsblog.com

It’s the process of Wisdom, the refinement of truth, workability and applicability and ultimately Grace both personal and temporal.

Abstraction and Orthodoxy

@Tony Bennett

You don’t count or follow the money flow very well. IF THE DEBT HOLDER GETS PAID OFF….HE GETS HIS MONEY BACK. And of course he is free to place that money back into whatever vehicle he so chooses. In the case of that bondholder being a bank that created debt out of thin air to purchase the treasuries that paid off debt instrument will become reserves which they will have a much better market condition into which they can lend….so no problem.

Keen’s modern debt jubilee is not much aimed at treasury debt actually, but where it really matters….the inflated housing etc. asset prices that remain as debt over hang on assets which the Banks bear primary responsibility for creating back when due to their deluded General Equilibrium theory they were enticing everyone and your dog’s uncle to invest in housing and creating derivative vehicles which got rehypothecated so many times who owned the original collateral….got lost.

So its a race against the idiocy of holding onto debt over hang to irresponsible Banks that threatens to create perfectly rhyming social conditions for world war in an age of modern weaponry where no one’s life and no one’s productive capacity is safe…..or the pinnacle concept of Wisdom, Grace as in monetary free Gifting. Most people here I understand are conditioned by the society to be ethically challenged enough to go for continuation of idiocy, but the idea that their assets, productive capability and the lives of their children and grand children, not to mention themselves….might just be enough to jolt them into present time reality.

@peterblogdanovich

That is why the tri-level banking system in my Wisdomics/Gracenomics is so important to implement. Leaving a private self interested monopoly in control of the money system is sheer historical folly. The central Bank has become the puppet/hand maiden of the TBTF Banks. My tri-level banking system restores sovereignty/sovereign control to the money system, governs that sovereign by mandating its policies express and enact the pinnacle concept of Wisdom, namely grace as in ethics, balance as in stability and integrates grace as in monetary Gifting into the digital debt based system. It therefore integrates both debt and Gifting, ethical sensitivity, sovereign control and prudence as in balance into a unified and holistic system. Wisdom is the very process of integration which is combining only what is ethical, only what is applicable and only what actually works.

@ Tony Bennett

Nope. You’re not counting right. The money system is digital in nature. Debt paid off by individuals disappears from the economy and becomes bank reserves…WHICH AREN’T ACTUALLY IN THE ECONOMY. TREASURIES PAID OFF TO BANKS BECOME RESERVES AS WELL.

CONSEQUENTLY, NO INFLATION/HYPERINFLATION.

What does happen is the debt overhang disappears so that individuals can spend into the economy again and make it functional. And of course if you implemented a universal dividend to everyone 18 and older and a retail discount that created price deflation you’d have the Austrian wet dream of having a roaring economy that was stably profitable for businesses even with prices falling.

wisdomicsblog.com

Wisdomics/Gracenomics is the precise, comprehensive and freeing monetary and economic theory and aligned set of policies to do it. I am the person who first recognized that every one of the leading/cutting edge theories and reforms have as their basis….an aspect of the philosophical concept of Grace, and Wisdomics/Gracenomics is the integration of those theories/reforms as well as my philosophical and policy extensions of those theories/reforms.

wisdomicsblog.com

@ Tony Bennett

“So, trading public debt for private debt? Who will pay down public debt?”

You’re still not comprehending. The Debt created by the government agency WOULD BE A GIFT OF MONEY, THAT IS, NOT DEBT, but still able to nullify debt.

“Now a days TBTFs make/buy loans of all sorts … then package them into securities which are peddled to investors (including banks). But there is also shadow banking…..”

And we’re going to let them continue in control of the money system????????????? Only an idiot who is blind to history would think or suggest such a thing. A sovereign agency would take that control away from the private banks. That’s sovereign agency as in sovereign grace as in benevolently powerful and yet restrained by policies THAT ACTUALLY EFFECT a gracious ethical sensitivity to the freedom of the individual and the free flowingness of the system.

wisdomicsblog.com

All of our problems arise from inaccurate counting/accounting and not knowing that it is merely this inaccuracy that is at the root of most if not all of the world’s  socio-economic, political and geo-political problems. All because we don’t count right and don’t know/refuse to believe we’re not counting right.  If the consequences that have arisen over the last hundred years were not so tragic they would be incredibly funny.  Not being open to looking in the proper place for the evidence is also human folly on a grand scale.

Trump is definitely a phenomenon because he is tapping into both frustration at the lingering economic downturn and the up till now amorphous sentiment that the establishment doesn’t give a sh!t about the individual. It’s hard not to sympathize even if you have democratic leanings. And this is probably why Hilary will not make history in November, although it may be close because there are almost as many democratic orthodox idiots as there are conservative orthodox idiots.

The only way for Hilary to beat Trump is to use an old trick like Dick Nixon did with his “secret” plan for the Vietnam war. She needs to say she has “a secret plan to free the individual and bring free flowingness to our glorious profit making economy.” This of course would be my Wisdomics/Gracenomics policies including a tri-level banking system that is a true alternative profit making system that thinks past and avoids the inevitability of the conscious socialism of orthodox idiot democrats and the unconscious socialism of orthodox idiots on the right.

wisdomicsblog.com

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Mish and Jacobsen are saying the very same things I’m saying politically and socially. Now if Mish would simply consider that if a business borrows $1 million to get up and going and its capital costs are $600k that means it has to get $1.6 million in the prices it has to charge the consumer or go bankrupt ….and there’s only been $1 million actually created to liquidate those costs/prices. Furthermore this is essentially the same problem faced by every enterprise so it is a flow of costs not some one off, anecdotal or static situation. And of course in a modern technologically advanced economy where capital costs are increasing (high tech ain’t cheap) and innovation and AI are willy nilly destroying aggregate demand. Voila! Social Credit has been right since Douglas observed it 90 years ago and Wisdomics/Gracenomics with its price deflationary retail discount mechanism is the perfect integration of Austrian economics and the ideology looking for self justification called General Equilibrium theory. So when are Mish and you guys going to open your minds and confront these realities?

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Half baked ideas are bad I agree. Blanchard a DSGE guy par excellance only has it half right because like almost every economists he is unconscious of the costing/pricing system that is a necessary and essential part of every enterprise’s toolkit. Keynesians are clowns because they think they can ignore or overcome the inflation modern economies manifest. Thus they go for such nonsense. Of course inflation is half of the problem with the economy but it primarily comes from systemic cost inflation. The scarcity of individual incomes in ratio to costs inherently produced by modern economies is the exact problem so a free gift of income is definitely called for and then to make the economy incredibly stable you have to implement a discount to retail sale (after each business has already discovered their best price which means it is not intrusive price controls at all merely seeing the economy as a whole and dealing with it in an adult fashion). Because retail sale is the terminal end of the entire productive/economic process and consequently all costs are summed for any item or service at that point as well discounting prices (again after businesses have already found their best competitive price) is free to do a discount percentage that actually creates the wet dream of every Austrian economist, namely price deflation. These two, a universal dividend and price deflationary discount at retail sale are the fully baked/fully thought out policies that will accomplish the best of the economic agendas of both the left and right and so is the integration economic theory direly needs.

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IICS:  Keen’s proposal is the only one that makes sense if they want to go this route. It’s simple, it’s a one-off solution (effective like a currency devaluation) and it will work.

Me:  Sorry, but Keen is still splashing around on the surface of the problem by looking at only debits and credits. He should know better because he’s a disequilibrium theorist and has thoroughly debunked General equilibrium theory. Debits and credits only make it appear that General equilibrium theory is correct because they apprently balance each other. That’s why it is so important to get to the real time 3 and 4 dimensional level of the economy by looking at the cost accounting datums and realizing that as a flow there are more costs/prices then there are possible individual incomes with which to liquidate those costs/prices and equilibrate the economy. After I posted on his sites that a new philosophy was necessary in economics Keen started saying the same thing. He’s guilty of doing the same thing that General Equilibrium theorists do….that is not looking where the data will enlighten you.

I will say Keen’s proposed “modern debt jubilee is spot on. Why? Because philosophically it aligns with the concept of grace as in giving, gifting and forgiving…in this case forgiveness of debt. That is Wisdom. And monetary grace as in the free gift resolves the economy’s most basic problem, that is a scarce flow of incomes in ratio to a simultaneous flow of costs and so prices, and also de-throne the glaringly inconsistent monopoly powers of the Banks/Banking system….is an even more comprehensive Wisdom as well.

In my tr-level Banking system private finance will not be able to leverage money only aggregate priorly earned and saved monies. Leaving private finance in control of the creation of money is incredibly stupid and anti-historical.

We already have a more than adequate definition of what wealth is. As we live in a monetary economy it is the things and services money can buy. If you had a discount to prices at retail that created price deflation and for every good or service actually purchased the discount was rebated back to the merchant who sold it….how could you possibly have price inflation??? Only orthodox dunces on both the left and right can’t/won’t see that. And for those who demand equilibrium in a numerical, orthodox and worshipful sense they just have to consider that more generalized saving by individuals and profit making by businesses translates into LESS need for and LESS actual financing by both. Debt is problematic especially when there is an inherent systemic scarcity of it produced moment to moment as there is now, and leads to the monopoly powers we see presently. Abundant incomes are in the individual’s control, and price deflation not only adds to individual purchasing power but pushes the vector of the economy toward money becoming a ticket for the distribution of production and helps downsize Finance as well. It’s all upside and would only possibly require tweaking regulation of interest rates on savings and hard headed underwriting standards.

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Me:  I would agree with all of that. To refuse to act in an adult, responsible and ethical manner to regulate and control private finance despite their monopoly control of the money system, and despite the fact of the negative economic effects of a flaw in an accounting convention is stupid and irrational. The only thing more irrational is to not actually look at the data and consider their economic consequences at all like conservative/libertarian economists and their pundits do.

And we should ask ourselves the question: When are people better able to think rationally about the ecology….when they are pre-occupied and stressed with “making a living” in an onerous system, or when they have a relatively abundant income in a stable economy?

Hilary is a shill for monopoly finance no matter what she says to the contrary, Bernie has admirable “fire in the belly” but was never electable and Trump is understandably trying to wring waste, fraud and abuse form the economy domestic and global, but still won’t accomplish as much for an ever modernizing and productive economy as the twin policies of a universal dividend and deflationary compensated retail discount would. If Trump wants to bring us into the 21st century, politically, bureaucratically, economically and monetarily….and free and empower the individual so that he/she can live up to their species designation of homo sapiens/wise and discerning man instead of being forced into a paltry, failed and unethically imposed homo economicus by a dominating financial monopoly hiding in plain site in a supposed free market, then he will be remembered as America’s greatest president. He probably has a more open mind than any of the candidates on either side of the aisle….now if he can muster a little Wisdom as well he could possibly accomplish more than he even now considers possible.

And inversely if he persists in fascist attitudes and/or unconstitutional policies he will undoubtedly be either impeached or bring social discontent and disruption to the country the likes of which we haven’t seen since the 60’s.

The character for crisis in Japanese is the same as that for change. Wisdom, ethics and Grace are the positive road out of our converging crises. Whoever becomes president let us hope that is the path they pursue.

Grace is integrated conscious awareness of one’s self and the emanations of the physical/temporal universe….at the same time. It is the continuous Trinitarian reality of the integration of Self Awareness, Space and Present Time.

Macro-economic/Economic Metric:   Inherent, systemic, continuous and hence dynamic scarcity of total individual incomes in ratio to total costs/prices simultaneously produced. This most basic macro-economic metric is being missed by virtually all economists.

Accounting:  The cost accounting convention that all costs must go into price. Every honest business needs cost accounting as a tool to determine profitability or loss is bound to this convention, but it is is flawed because it correctly allows for capital depreciation for businesses but fails to compensate the individual for capital appreciation. Thus cost inflation is the inherent, systemic result.

Financial:   The Banking/Financial System will brook no competition for either money creation or for variety of vehicle for doing so. It will only allow loans, and will not allow monetary Gifting which is the only economically valid way to resolve the inherent. systemic cost inflationary nature of the economy.

Paradigmatic:   We are habituated to and hypnotized by Debt, and by the puritanical attitude that ” there is no free lunch” and that “man must be condemned to make his living only by the sweat of his brow”/only via employment. These despite the cost inflationary nature of the economy and the monopoly control of the financial paradigm of “Debt Only” which excludes the Free Monetary Gifting which again is the only valid economic solution to the problem.

Entropy/Non-Entropy:   The economy itself is utterly embedded in the temporal/physical universe and hence is governed by the laws of thermo-dynamics. Thus it is subject to randomness and the resulting increasing costs to maintain itself. The money system is basically an idea and hence is not subject to the laws of thermo-dynamics and can thus be utilized to intelligently eliminate (and even reverse) the inherent excess costs and scarcity of individual incomes created by the economy.

Money/Grace-Consciousness:  Money is the analogous concept to Grace-Consciousness in the money system and its complete integration with the economic system. Thus it (money/the money system) must thoroughly reflect the nature and various aspects of Grace-Consciousness including the ethical consideration of the individual as the essential and primary point of the system, continuous, moment to moment, complete and simultaneous reach of policy to the individual so as to free both the individual and the system. As the economy is temporal/entropic and the money system is static/non-entropic, they must be thoroughly integrated in order to attain and maintain a third and unified graceful and abundant flow. This graceful continuous maintaining would be best accomplished by reversing the current moment to moment unequal macro-economic metric of a scarcity of total individual incomes in ratio to total costs/prices into an excess of total individual incomes in ratio to total costs/prices and thus creating a continuous flow of individual abundance and systemic free flowingness. This state would be created by the policies of a universal dividend and a discount to retail prices that effected actual price deflation integrated within a profit making system. Thus is economic stability achieved via “a higher disequilibrium metric.”

Wisdom, i.e. the open minded and integrative intellectual stance and the natural concept of Grace-Consciousness in all of its many aspects is the the way out of these subtle and complex problems and the way home for human individuals and for the economy and society as a whole.