MMT

Stephanie Kelton is an economist and an advocate of modern monetary theory (MMT) and she was the economics adviser to Bernie Sanders. This is where he got his ideas about spending our way to prosperity. According to MMT experts, any country that prints its own money, as the US does, cannot run out of money and is only limited by inflation. This has been around for many years but not often said in public. In 2005 Alan Greenspan was asked if social security would run out of money and he replied: "I wouldn't say pay-as-you-go benefits are insecure in the sense that there's nothing to prevent the federal government creating as much money as it wants in payment to somebody." In 2009 Ben Bernanke was asked about financing the one trillion dollar bail out of the banks came from the taxpayers and he replied: "It's not tax money. The banks have accounts with the Fed, much the same way that you have an account in a commercial bank. So, to lend to a bank, we simply use the computer to mark up the size of the account that they have with the Fed. It's much more akin to printing money than it is to borrowing." The current GDP is $22 trillion and the current debt is $29 trillion and the ratio of GDP to debt is 131%. Japan has a GDP to debt ratio of 240% and their inflation rate is negative .3%. According to MMT the country can keep printing money until full employment and then, to stop inflation, it will increase taxes. MMT proposes no tax increases and zero interest government loans to banks to create money at very low interest rates to fire up the economy. This is about to happen and we shall see.