Stu on Nostr: That is an open ended fiscal system, and that’s not what we have. The US government ...
That is an open ended fiscal system, and that’s not what we have.
The US government has the Treasury General Account. The UK government has the Consolidated Fund. These bank accounts are a part of the economy, they don’t ever go negative and their balances are published daily. Look them up.
In a capitalist economy (pre-2008), government deficit spending is supposed to drive up interest rates, as the gov has to go to the bond market to borrow more money. But since 2008, the Central Banks have just created new money to buy bonds and force rates low whilst encouraging ever more deficit spending.
2008 really broke capitalism and since then we have had a sort of monetary command and control economy. But it doesn’t work like the diagram shown above.
The US government has the Treasury General Account. The UK government has the Consolidated Fund. These bank accounts are a part of the economy, they don’t ever go negative and their balances are published daily. Look them up.
In a capitalist economy (pre-2008), government deficit spending is supposed to drive up interest rates, as the gov has to go to the bond market to borrow more money. But since 2008, the Central Banks have just created new money to buy bonds and force rates low whilst encouraging ever more deficit spending.
2008 really broke capitalism and since then we have had a sort of monetary command and control economy. But it doesn’t work like the diagram shown above.