Re: 'Stability' Of Equilibrium w/Zero-Cost Money

["Gunnar Tomasson" <tomasson@xxxxxxxx>]

You write:

1.  More money is routinely created then debt, through the mechanism
of interest....

2.  Money = Debt + Interest on Debt.

3.  (Interest is the cost of issuing debt).

4.  If the CB is the people's bank and government borrows from the people's
bank then government interest payments on government debt should be
distributed among the people, and not into the CB!

Comments:

1 - 2.  Again, I don't get it.  For the World Financial System, the Money =
Debt equation is short-hand for System Liabilities = System Assets.

3.  In the context, Zero-Cost Money relates to Credit Creation as such and
not to Non-Zero administrative expenses incurred by the World Financial
System.

4.  The question does not arise so long as 'interest' payment by government
= CB administrative expenses incurred on account of government borrowing
from CB.

Gunnar



----- Original Message -----
From: "Harry Veeder" <eo200@xxxxxxxxxxxxxxxxxxx>
To: "Gunnar Tomasson" <tomasson@xxxxxxxx>; "Harry Veeder"
<eo200@xxxxxxxxxxxxxxxxxxx>
Cc: "POST KEYNESIAN THOUGHT" <pkt@xxxxxxxxxxxxxxxx>
Sent: Thursday, September 21, 2000 2:32 PM
Subject: Re: 'Stability' Of Equilibrium w/Zero-Cost Money


> On second thought, I was wrong but that doesn't mean I agree with your
> synopsis.
> More money is routinely created then debt, through the mechanism
> of interest....
>
> Money = Debt + Interest on Debt.
>
> (Interest is the cost of issuing debt).
>
> If the CB is the people's bank and government borrows from
> the people's bank then government interest payments on
> government debt should be distributed among the people,
> and not into the CB!
>
> What do you think?
>
> Harry Veeder
>
>
> ----------
> >From: "Gunnar Tomasson" <tomasson@xxxxxxxx>
> >To: "Harry Veeder" <eo200@xxxxxxxxxxxxxxxxxxx>
> >Cc: "POST KEYNESIAN THOUGHT" <pkt@xxxxxxxxxxxxxxxx>
> >Subject: Re: Re.: 'Stability' Of Equilibrium w/Zero-Cost Money
> >Date: Thu, Sep 21, 2000, 3:51 pm
> >
>
> >Harry:
> >
> >I don't get your point.
> >
> >The Creditary View of Money is summarized in the Money = Debt equation.
> >
> >One gets into debt by signing Zero-Cost IOU, the counterpart to which is
> >Zero-Cost Money (or Bank IOU).
> >
> >Gunnar
> >
> >
> >----- Original Message -----
> >From: "Harry Veeder" <eo200@xxxxxxxxxxxxxxxxxxx>
> >To: <pkt@xxxxxxxxxxxxxxxx>
> >Sent: Thursday, September 21, 2000 9:57 AM
> >Subject: Re: Re.: 'Stability' Of Equilibrium w/Zero-Cost Money
> >
> >
> >> Gunnar Tomasson wrote:
> >>
> >> <snip>
> >> >8. Now, money impacts real-world economic developments - once it is
> >> >recognized that modern money is created with the stroke of a computer
> >key,
> >> >the proposition that "Walras's theory and all others along those
lines -
> >> >including Samuelson's - are little better than nonsense" does not hold
> >water
> >> >- THEY ARE NONSENSE!
> >> <snip>
> >>
> >> This would be accurate if modern money weren't always created with a
> >> corresponding amount of debt.
> >>
> >> Harry Veeder
> >>
> >>
> >>
> >>
> >>
> >>
> >>
> >>
> >
> >
>
>