Jul 31, 2022
Welcome to episode 129 of Activist #MMT. Today's part two of my two-part conversation with Dirk Ehnts. Last week in part one, Dirk described his journey from a PhD in mainstream economics, to discovering and accepting MMT. Today, I ask questions circling around his new co-authored piece for the Gower Initiative, called Raising interest rates is like blowing up the garden to weed it. It starts with some very basic questions about how and why the central bank maintains the stability of the payment system. I then ask the specific mechanics of the central bank's raising its overnight target rate, and how it ultimately results in millions more becoming unemployed – and therefore more exploitable. I continue to struggle with these concepts, but after this conversation, I feel like the questions have become more clear.
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And now, let's get right back to my conversation with Dirk Ehnts. Enjoy.
Audio chapters
- 5:13 - Start of academic questions
- 5:35 - What is the nature of a catastrophic failure of the payment system?
- 12:12 - Central bank versus Blockchain, a financial justice system
- 14:59 - Warren Mosler story about company accidentally receiving millions extra from central bank.
- 15:24 - Central banks and reserves, parents and food for the kids, power struggles
- 21:36 - Increasing interest rates- the mechanics and its effects (dis-employing people) (transmission channels of monetary policy)
- 29:07 - The MMT view of interest rate targeting
- 36:53 - I try to restate
- 44:44 - Germany are Greece are both currency issuers, but with different power
- 50:48 - The difference in power between Germany and Greece
- 56:23 - Goodbyes and Levy summer session
- 1:01:02 - Duplicate of introduction, but with no background music (for listeners with sensitive ears)