Re: Sweden - Monetary Policy

[Bruce McFarling <ecbm@xxxxxxxxxxxxxxxxxxx>]

On Sat, 28 Apr 2001 10:47:31 -0700,
John O'Donnell <jackodonnell@xxxxxxxx> wrote:

>It could be that the earth should be the center of the
>universe but facts are facts and printing more money does
>not add to the value of anything. A tautological certainty
>is a tautological certainty no matter what Mill, Ricardo,
>Bentham or even Gunnar may claim.

The facts are that under the monetary systems of most
countries, the printing of money has next to nothing
to do with the total money supply.  Most money is
created in the act of lending.  The provision of credit
CAN add to the total product of an economy, if it permits
the mobilisation of resources that would otherwise be
idle, or alternatively permits the redirection of
resources from a less productive to a more productive
use.

This is, after all, one important impact of the "printing
money" myth: to divert from considering the question of
whether the impact of credit creation is or is not
beneficial.

Virtually,

Bruce McFarling, Shortland, NSW
ecbm@xxxxxxxxxxxxxxxxxxx