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

["John O'Donnell" <jackodonnell@xxxxxxxx>]

Harry Veeder wrote:
>
> 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.

It's nonsense in any case. Creating a nonsensical strawman
and destroying it with a triviality is just one of many
obfuscations economists use to avoid obvious truth. Money is
not "neutral" and labeling dQ/dM = 0 as "neutrality of
money" does not change the truth that the quantity of goods
and services produced in an economy is independent from the
quantity of money in that economy.

There is no quantitative relationship between the quantity
of money and the quantity of goods and services produced in
an economy but there is a significant consequence to
productive activity by ignoring the effect of the quantity
of money on the value of money. By calling this relationship
neutrality of money economists, after showing money is not
neutral, claim they can cause useful economic activity by
pretending printing money will cause useful economic
activity. I.e. -- they substitute nonsense for nonsense and
call themselves experts.
--
			-- jbod

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