Book (and other) News
Happy holidays!
I hope that those of you who celebrate Thanksgiving had a joyous feast with friends and loved ones. Ordinarily, I would prepare at least a couple of side dishes the day before, but I wasn’t able to do that this year because I spent most of Wednesday in NYC at Danske Bank’s annual New York Summit.
I spoke at the Summit in 2019, and I was invited back to debate/discuss inflation, debt, and deficits with Harvard economist Ken Rogoff. It was a private event, so there is no video. But we had a good discussion, and I had the opportunity to challenge the audience (and Ken) to think differently about why a currency-issuing government (like the U.S., Japan, the U.K., Australia, Canada, etc.) issues securities, whether it has to pay “market rates” on any bonds it chooses to issue, and whether it makes any economic difference whether interest rates are supported via Treasury paying interest on bonds or the Federal Reserve paying interest on reserves. This is all old hat for me, but the arguments were new to much of the audience.
As Warren Mosler explains, bonds are sold to maintain interest rates, not to “fund” government as conventionally understood. (Click here for the short clip and here for the full interview.)
In Other News
Many of you subscribed to this newsletter after reading my first book, The Deficit Myth: Modern Monetary Theory and the Birth of the People’s Economy. Writing that book was a labor of love, and I am humbled that it continues to serve as a beacon of hope and inspiration for so many people. If you haven’t read it, Amazon has chosen to promote the Kindle edition at a special price ($3.99) for the entire month of December.
And now for the big news.
The proposal for my next book went to prospective publishers last month, and the response was nothing short of incredible. I spent the last two weeks meeting with some of the most impressive teams in America, and the book was auctioned yesterday. I am still digesting everything, but I can tell you that I am excited to be “pregnant” with another book (something a friend and well-known author once told me was a prerequisite to grinding out a book).
As the fall semester winds to a close, I am about to go full-throttle. More on the book—title and publisher— coming soon! I hope you will continue the journey with me.
I've been a fan since your NEP and UM-KC days, and won a tee-shirt in your "deficit owl" contest. Cannot wait for your new book! - Bill Beyer
Exciting news! Happy Holidays!
Mr. Rogoff is perhaps best known for his debt scolding, via the paper, "Growth in a Time of Debt," 2010.
Rogoff and his U of Maryland colleague Carmen Reinhart wrongly fixated on public debt in that paper, not the dangers from private debt as MMTers tend to believe. Why? R&R state that, "Our main focus has been on central government debt ... since reliable data on private domestic debts are much scarcer across countries and time."
They do note that "rapid expansion in private credit fuels the boom phase," followed by "serious deleveraging" and expansion of public debt. This point seems to have completely lost on them.