Derp, derp, derp

So the British Recovery Bonds:

The latest version was published here, in January, where the economic justification for this was provided.

And for those familiar with MMT, this is not of course what a pure MMT approach would suggest. It would say that there could be funding without bonds, and I agree. But, there is good reason for this alternative now.

The first such reason is that QE has created the savings pool I referred to recently, which is deeply destabilising to the economy and MMT has no answer to that. Second, that money has to be withdrawn from the economy without tax right now, and savings can do that. Third, the savings need to be non-speculative and locked down. The bond idea achieves that. These bonds address an issue we have. And that is justification enough for me.

The idea is, of course, that peeps go save in the bonds and then the money gets spent. That does not lockdown those excess savings, it mobilises them. It does not withdraw them from the economy, it injects them into it.

Murphy doesn’t even understand his own policy.

14 thoughts on “Derp, derp, derp”

  1. The first such reason is that QE has created the savings pool I referred to recently, which is deeply destabilising to the economy and MMT has no answer to that. Second, that money has to be withdrawn from the economy without tax right now, and savings can do that.

    So, people have savings, and this is bad and destabilising (WTF?)
    The answer is to put the savings into savings, and this is good.
    If you save into my bond scheme, you get no interest and no redemption.
    Please form an orderly queue. Where is everyone?

    A long-winded way of saying: other people got more money than me, I want it.

  2. Does he explain why the excess money has to be withdrawn by some means other than taxation or is Thursday a day when tax is not a means of regulating inflation?

  3. “The idea is, of course, that peeps go save in the bonds and then the money gets spent. That does not lockdown those excess savings, it mobilises them. It does not withdraw them from the economy, it injects them into it.”

    Tim, in fairness to murphy (and i think he is a twat btw) giving savings to the government is a withdrawal of kind as the money could otherwise have inflated goods, services, the stockmarket etc…and yes technically the Govt is using the money to invest in infrastructure or whatever so is indeed mobilised..but it could have just created that money anyway if it wanted to and would probably need to, in order to counter unemployment

  4. What I can’t understand is, is why Murphy keeps getting taken seriously by anybody? It defies belief that anyone would pay him for anything, beyond simple book keeping where he could do little harm.

  5. @MrVeryAngry

    Murphy tells whatever fantasies are required to those who require fantasies. There are always such people so he will always have an audience. See “snake oil salesman”

    “simple book keeping where he could do little harm.”

    Don’t underestimate him.

  6. Andrew C

    As he has said many time quoting allegedly from Gandhi:

    ‘”First they ignore you, then they laugh at you, then they fight you, then you win”’

    For me these stages are not mutually exclusive. You can laugh at the man’s overweening combination of arrogance and ignorance while fundamentally opposing him having any kind of say on how we are governed. should he win it will be the end of humanity so I’d say fighting him is fairly crucial. He is a rare kind of evil and should most definitely not be underestimated.

  7. @Van Patten

    Can’t remember who it was* who responded to someone who quoted the alleged Gandhi quote by saying:

    “Yes, they laughed at Gandhi but they also laughed at Coco the Clown”

    *Possibly Karl Sagan

  8. He’ll claim anything if he can see a possible job, a grant or a peerage out of it. But I can’t see Starmer wanting advice from someone whose policies were considered batshit by Corbyn and McDonnell.

  9. O/T, but linked. I saw this on Wiki’s explanation of MMT

    “Government interest expenses are proportional to interest rates, so raising rates is a form of stimulus (it increases the budget deficit and injects money into the private sector, other things being equal); cutting rates is a form of austerity.”

    So under MMT, we should jack up interest rates to what? 20%….?

    Bonkers!

  10. Little shortarse Richie Spewknack has form as a dodgy Bond salesman and the British people have form as mugs so this is a dangerous idea. But not in the clammy goon’s hands of Stumour and gang.

    Blojerk Johnson is much more a credible con-man. You’d still have to be a fuckwit to buy any–but how many cowardly virus -freakout fuckwits are there? Millions for sure.

  11. Harry Haddock's Ghost

    I have to admit, I am completely confused by these bonds. If they offer rates lower than the market borrowing rate, then nobody will invest in them; I am assuming that this market includes bog standard government bonds.

    If they offer interest rates higher than the market borrowing rate, then if the government want to borrow, it can do more cheaply on the standard market. Like it does now.

    If they offer market rates, they are just bonds.

    So what is ‘new’ about them? How is this even being suggested as a ‘policy’ ? Isn’t it just ‘the government should borrow some cash’? Hardly fucking groundbreaking or unique.

    Unless, of course, people or institutions are *forced* to buy them, via some kind of compliance or other bullshit. Then that is new; it’s call appropriation or ‘theft’. Or possibly ‘tax’ so perhaps not as new as we think.

    Help me out here ..

  12. @AndrewC – you’re probably thinking of:
    The fact that some geniuses were laughed at does not imply that all who are laughed at are geniuses. They laughed at Columbus, they laughed at Fulton*, they laughed at the Wright brothers. But they also laughed at Bozo the Clown.
    Carl Sagan (1934-1996)
    * Robert Fulton – designer of the first practical steamboat and submarine

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