Tuesday, May 9, 2017

Modern Monetary Theory Doesn't Address Any Of The Real Issues Of Capitalism Being Obsolete

More to the point, however, is the fact that using it might actually make things even worse; precisely because electrified Capitalism has become so warped, and chaotically out of control (if control were ever really possible at all) now.

From my perspective this sounds an awful lot like trying to have it both ways with declaring something of government issue as valuable. In a sense it tries to combine the assumed substance of a precious metal, but with the non traded, stamped value, of a coin; which is simply printing money a different way. Rather than put more gold in Fort Knox and say we have something of substance to back further spending, they mint this coin and hold it instead. And then try to claim that it is not inflationary because it is not in circulation; but of course it is as possibly inflationary as any other means to put more counters into circulation because the immediate spending by the government based on this new backing value, could do precisely that. And you have to wonder at just how practical it is to rely on taxation to implement your inflation control mechanism; know how much certain people like to collect vast reserves of them.

Let's review some basics here:

Scarcity and perception go hand in hand as a basic to Capitalism. How could it be otherwise.

Understand first of of all that Capitalism starts with the notion that: "Everything is worth what a purchaser is willing to pay for it." So right away the subjective nature of how value comes into being is established. I am willing to spend to the degree that I perceive value.

Scarcity is great in this context because it provides what seems like an objective component to be placed into the consideration: Practical availability (assuming you can induce someone to want a thing in the first place, which really sets things up for more complexity). Obviously, if it's hard to come by, and if want has been generated, the perceived value is likely to go up.

All of this serves to emphasize the idea that how we know, what we know, and how confident we are in the process of knowing, is of absolute importance. But wait. Information itself is now a precious commodity. So now everybody who gets it wants to shepherd it to their best advantage (putting the best spin one can on the description). That means everything you might get must automatically be suspect as to what it is that the provider gains in putting it out there in the first place. One might argue that we are at war now for a number of important definitions, as well as in how things get defined in the first place.

Modern Market Theory, it seems to me, would be an exercise in trying to control the perception of your nation's monetary counters; understanding that government spending, or debt, is not the only way that we have for increases in absolute numbers of same. After all, what is it that happens when a bank lends money, creating a paper payment instrument to service that debt, and is only obligated to keep a modest percentage of the cash reserve on hand that represents the deposits thus lent out? That's new counters as well; justified precisely as long as the servicing payments are kept up. And the people who take our counters in different countries for the things they make for our consumption, if they begin to collect large amounts of them, are going to be very keen in their concern as to whether they are worth a great deal more, or less in their counters, or the counters of any other nation. Basically the same thing the other guys around them will be doing as well. And what they end up deciding will be quite problematically connected to what we've done to convince them of the value. As it has always been, only more so now because act and fact and react fly around the world ever faster. With ever greater accumulations of counters, or property, at risk.

I recognize that I may be missing something quite crucial here for this theory so I would welcome critical comment from those who consider themselves proponents. I would, in particular, like to hear how they feel about my main contention here: that Capitalism is in fact obsolete, and for quite obvious reasons of technological change. If you know somebody of that ilk please pass this post on to them. I would be most interested in the feedback (or any informed feedback for that matter).

The Rock-Star Appeal of Modern Monetary Theory