What is Modern Monetary Theory(MMT)?

What is Modern Monetary Theory(MMT)?

The traditional economy sees a government as a body that needs some money to sustain itself its activities and so to fund the finance itself by debt issuing bonds and then getting money for the for the bonds and pay it later when economy grows.

The modern monetary theory has a different view on the connection between government and population, it states that government can buy good services or any asset by just printing its own money and without the need of taxation so instead of introducing taxes why not to just print more money. The first and second law of MMT basically tells that the government can’t go bankrupt.

How MMT Solves Unemployment?

In case there is any debt payment due the government can just pay by printing new money then then may get new debt or something similar.

What is Modern Monetary Theory(MMT)?

The only limiting parameter may be unemployment and inflation but the modern monetary theory(MMT) unemployment is caused by not enough money in the economy.

If there is enough money in economy the unemployment can be reduced significantly or maybe completely end unemployment in ideal case as there is money people and businesses can get more money can employ more people and they can save and invest more.

How printing money helps the rich?

How MMT handles Inflation?

‘Inflation’ will act as a limit factor but the fourth postulate of MMT says that inflation can be reduced by taxation. As stated earlier taxation is not needed to finance the government in that theory it is needed to withdraw the money from the economy or circulation that is already poured into circulation and by withdrawing the money form circulation government reduce the inflation.

There are a lot of technicalities of MMT like understanding of how economy could work, how government could work in modern word world. Although its not 100% MMT as government still issue bonds so that they can get new money from the central banks

Why government and economist don’t appreciate cryptocurrencies?

Talking about modern monetary theory cryptocurrency can be big problem or enemy of the disciples of MMT and government. As the government who use MMT as it supports their needs. MMT gives government a reason for for spending for what government does but with cryptocurrencies.

why Moneo is better then BTC?

The fact that government is printing money recklessly people are attracted towards cryptocurrency.
The fact that people starting to prefer cryptocurrency is quite uncomfortable for ‘democratic’ government to seek an excuse to discourage people to use it. So introduction of cryptocurrency don’t goes well with MMT.

Related Posts

Leave a Reply

Your email address will not be published. Required fields are marked *