[RobertoG]

What you mean is that it's not mainstream. That's true.

Despite that, I can't recommend it enough. It's just after starting to read it that what was going on in the economy of the world made any sense to me.

Also, mainstream economy is just totally wrong in many of its descriptive aspects, but they continue teaching falsehoods anyway. An example at hand is how the fractional banking and the creation of new 'money' by banks works in, virtually, all the modern economies.

This is the reason that the linked PDF by someone a few posts above is so important. They say what Modern Monetary Theory have been saying all the time but the source is the Bank of England.

I think it deserve to be linked again: http://www.bankofengland.co.uk/publications/Documents/quarte...

As Henry Ford said: "It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."

[vezzy-fnord]

The problem with MMT is that it extrapolates far too much from accounting identities and treats both the financial system and the state as a closed vacuum divorced from all issues of public choice and expectations. This is what leads to Mosler's "Seven Deadly Innocent Frauds" and his policy proposals. That they're frauds is technically correct from a national accounting POV, but taking them literally as the MMTers do can be disastrous. In fact, it's not taking them literally that separates MMTers and other people. It's not that mainstream economists aren't aware of the logical implications of ex nihilo fiat money creation.

Also, MMT is nothing new or groundbreaking, contrary to their claims. There have been chartalist and endogenous money creation theories for ages, and most mainstream economists are quite aware of them, contrary to the assertions of many MMTers. What separates MMT from the rest is its fusion with more dubious Post-Keynesian theories.

[RobertoG]

I have to read yet a good criticism of MMT that have not been addressed by the MMT proponents. Maybe you can address me to one.

MMT people don't claim it to be any new or groundbreaking, on the the contrary, they claim is just common sense and chartalism. What they claim is that chartalism is true, especially in modern economies. This is a very difficult thing to dispute if you analyze how money works nowadays.

In my experience, the real problem with MMT, is that the implications of what an economy is or how it really works are politically indigestible for a lot of people and inconvenient for a few.

[vezzy-fnord]

Again, the problem is not the chartalism per se, it's that they read far too much from it for the policy aspects. They basically use the monetary theories as a front for the far more dubious Post-Keynesian policies, which have to be analyzed separately.

A good reading of the Public Choice journal and similar is a nice antidote to some of the zanier MMT and Post-Keynesian proposals.

[RobertoG]

Public Choice journal, I would prefer a more specific link to a good critic of MMT but I take note, thanks.

I want to return the courtesy, this a reply to critics or MMT: http://www.levyinstitute.org/publications/modern-money-theor...

I have not problem with a lot of post-keynesian ideas by the way.

[vezzy-fnord]

§5 speaks in broad hypotheticals and apologetics of efficiently administrated policy, and is unsurprisingly very weak relative to the accounting and qualitative statements in the previous four sections.

If anything, you've convinced me more that MMTers believe in a perfect State. Post-Keynesian ideas seem to emanate from it. Kalecki and Robinson were outright Marxists, the former basing their economics on class conflict and the latter praising North Korea and Maoist China. The entire Post-Keynesian literature is devoid of public choice considerations, sans one weak paper from ~2004.

[RobertoG]

If MMT claims are so weak we are in dire necessity of a paper or, at least, a blog post that address its issues seriously. After searching, I have not found such thing. Maybe you could write it.

Most critics dismiss the conclusions or address questions that are not really part of MMT.

Personally, I am specially interested in criticism of the most descriptive part of MMT, starting on chartalism but going beyond, banks money creation, sectoral balances, foreign exchange, etc..