Framing Modern Money
Here’s an excellent example of good framing. Susan Feiner explains why sovereign governments using “modern money” (their own currency) cannot go bankrupt.
U.S. Bankruptcy–A Colossal Hoax.
by Susan Feiner, Professor of Economics, University of
Southern Maine
Readers put on your thinking caps and learn something new
about money.
Modern money—not the old fashioned, greasy kid’s
stuff—follows uber modern rules, rules which have been
misrepresented/misunderstood in the coverage of Washington’s debt-ceiling
hysteria.
First things first: no matter how much money we’re talking
about, there’s nothing there—not gold not silver. At best, a few reams of green
paper.
Follow up:
For some folks the fact that there’s nothing there is
intolerable. “How,” they wonder, “can money be so important, and so
insubstantial?”
That’s modern money. When was the last time your pay (if you
still have a job, there are 29.2 million unemployed or underemployed in the US
today) was cash in an envelope? Like 99.9% of Americans you get paid by check
or a direct deposit.
Someone working for your boss tapped on a keyboard (just
like the keyboard I’m typing on now), to initiate a transaction that put
‘money’ in your checking account by taking ‘money’ out of your boss’s checking
account.
That money is just a click, an electronic blip, your ability
to keep bread on the table and a roof over your head, an ineffable nothing, and
the root of all evil.
Read the rest here:
http://econintersect.com/b2evolution/blog2.php/2011/08/13/u-s-bankruptcy-a-colossal-hoax-1
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