This is where the MMT people are tripping over the banking system. BOTH government spending AND bank lending create money. And the bank money trades at par with government fiat money. It is said that bank money disappears as it is repaid; that the note backing it is extinguished and the accounting units return to the ether from which they emerged. But this is not the case. Both the principle and the interest remain in the economy distributed first to a seller of which was the object of the loan, then interest to the bank and then into the normal flow of the economy. The "interest" is not taken from the economy and used to fill Scrouge McDuck's swimming pool. It is used to pay the enterprise that "provides" the credit. It may be that the bankers are sucking up too much of the interest and, in fact, hoarding it. But this is not a necessary evil of the system itself. There will have been more goods (even capital goods) produced both directly and indirectly because of the loans. Hence, the money does not lose value unless it is used unwisely (a loan not repaid) because there are more goods to "soak it up" and there are more and more people as population increases. Government does the same sort of stuff. The battleship is brought into existence with a loan from the FED. T-Bills are then sold to "repay" the loan at the FED. Taxes are the payments on the loan (now backed by the T-Bills). MMT says that the T-Bills are not necessary and that is correct. Taxes are the real payments on the loan that created the battleship. T-Bills offer a place for people to store savings. The difference is that government is not charged with a profit responsibility. The only monetary responsibility is to insure that the money retains a proper value. Those who do not understand the actual labor theory of value (see Smith, not Marx) seem to have a serious problem with this. As we seek to fulfill our needs and wants wealth is the capacity to forgo labor or to command the labor of others.
I suggest everyone study up on mmt because it's the next scam that's most likely to be used to keep it all propped up. The elite own and politically run this country. They've set real interest rates below zero and are admitting that they're never going to do anything about it. Only talking about selling fed balance sheet. Never going to happen. Combined with what they're trying to pull off in the political realm, it's evident that they'll do absolutely anything to maintain their wealth and power. Once a downturn comes, mmt will be the only avenue left to keep things propped up. It's a scam just like all interventionist economics, but it does work for awhile, just like most gov't plans work in the here and now and ignore the unseen in the future. When the country is levered up and even zero interest rates won't work anymore, the money printing via mmt begins. More money is required to grow an economy. It cannot be allowed to deflate. I'll remind everyone that John Mccain advocated the US gov't buy up all US mortgage debt as a way out of the o8 financial crisis. And that was even before we went on this zero interest rate forever fed policy. The frog in the pot is about to boil. Once they begin talking about it, it will very quickly become conventional wisdom that 'all economists agree on', and opposers will be labeled deniers and heretics. Because to allow all the inefficient debt to clear poses too great a threat to the powers that be. All the arguments for mmt are bogus. They'll stop printing 'when inflation starts'. Are you kidding? More likely they increase the tampering with inflation statistics.
I can highly recommend to you the Randall Wray lecture that someone linked to above. Wray was a student of Minsky. Minsky understood money. It appears you may not.
I've read numerous articles on mmt by wray and others. That's how I know it's a fraud. Because I can think. I'm not a lunkhead who swallows every half truth thrown my way. You apparently are. I could go through point by point how ridiculous the entire theory is but it would be over your head.
Then what have you learned? It's rhetorical, don't answer. I know what you learned, nothing. Because in your opinion "All the arguments for mmt are bogus." (whatever that means?) The first essential requirement for learning is to want to learn. The next is to question. It seems you have not got the first requirement in hand yet.
According to this article, economist Randall Wray denies that historical governments debased their currencies by decreasing their gold and silver content. That governments have debased their currencies in this manner is a historical fact that only a charlatan would deny. https://googleweblight.com/?lite_ur...035380&sig=ALNZjWn_SnEJi7FtsoC01NHkJReTZR7UXg Just the type of economist that you would rely on to affirm your belief in this bogus mmt theory.
Of course you are a "lunkhead". What evidence have you that you are not? If you dismiss Minsky's analysis out of hand. Then you are dismissing a very important alternative viewpoint, one that well could be correct. At least it has been correct so far. With your attitude you'll never learn, and that, isn't it, is the definition of a "lunkhead".
Why don't you, "Lunkhead", read Randall Wray's book "Understanding Modern Money" and decide for yourself. That's a rhetorical question. I know already the answer: Because you can't; it is too deep for you. There is an entire chapter in Wray's book on debasement of money, but you'd have to read the preceding chapters to be capable of absorbing it.