Re: Refuting supply-side economics

From: William F Hummel (wfhummel_at_comcast.net)
Date: 09/26/04 

Date: Sun, 26 Sep 2004 19:37:27 GMT

On 26 Sep 2004 11:43:58 -0700, larryinnes@yahoo.com (Larry Innes)
wrote:

>It's extremely unwise for any financial entity to assume that it has
>unlimited power to expand its credit. Financial credit is supported by
>the ability to reduce the debt. Unlimited expansion of the credit
>invariably leads to bankruptcy of the credit. Do you have any example
>to back up the notion that a nation can indefinitely run up its debt?
>Even the dumbest economist no longer believes this fantasy. Only the
>brainless one continues to do so.

Is it too much to ask that one should read with comprehension before
responding? Here is what I said:

"The government doesn't borrow because it _needs_ the money. It is
the public that needs base money in order to pay its taxes and to back
the credit money used in daily commerce. The government has unlimited
spending power in its own base money (currency and credits at the
central bank). It borrows only to recapture what it deficit spends,
the purpose being to maintain the purchasing power of the currency."

The fact that the government has unlimited spending power in its own
base money is a simple fact. But that doesn't imply it actually
intends to do so or has done so. I'd be surprised if any economist
ever believed that it did -- from which I conclude that you are not an
economist, at least not one with a good understanding of monetary
economics.

Relevant Pages

  • Re: F**K!
    ... They might get $7 for their $8 credit, ... As I mentioned we have several hydro stations near by. ... also got some power from Hydro Quebec. ... been two good size hydro dams near me as well as a bunch of smaller ...
    (rec.motorcycles)
  • Re: Refuting supply-side economics
    ... >>It's extremely unwise for any financial entity to assume that it has ... >>unlimited power to expand its credit. ... >the public that needs base money in order to pay its taxes and to back ...
    (sci.econ)
  • Re: F**K!
    ... One would be to have the increased tax used to support the ... They might get $7 for their $8 credit, ... Carbon credit trading under the right conditions has some value. ... The power could be fed back through my electric meter turning it ...
    (rec.motorcycles)
  • Re: J Buck 41 "old farts crowd
    ... That's a great analogy. ... giving up power is not usual. ... A lot of the credit given to the WW II generation is deserved for its ... The building of international institutions ...
    (alt.sports.baseball.bos-redsox)
  • Re: Another significant Clitton figure added to Obammas cabinet
    ... The Nobel for Economics is a joke. ... I don't want an economist with a fucking ... What the fuck does politics mean? ... CREDIT IS NOT A RIGHT. ...
    (rec.martial-arts)