Re: Keynesian Christmas!

[Gunnar Tómasson <gunnar.tomasson@xxxxxxxxxxx>]

Argentina's current crisis underscores for the nth time in recent years that
post-Bretton Woods monetary arrangements at both national and international
levels are - somehow - fundamentally flawed.

As one who cautioned IMF colleagues in December 1976 that the then-recent
increase in commercial bank borrowing by leading Third World and Eastern
European debtors might in due course entail "possible repayment
difficulties" which might "undermine world financial arrangements" (I don't
have my text before me as I write this - but the quotes are substantively
correct), I have long been persuaded that it is only through fundamental
Monetary Reform at both national and international levels that sustainable
arrangements can be put in place for the pursuit of desired employment and
output objectives.

Gunnar




----- Original Message -----
From: "pdavidso" <pdavidso@xxxxxxx>
To: "Henry C.K. Liu" <hliu@xxxxxxxxxxxxxx>
Cc: <pkt@xxxxxxxxxxxxxxxx>
Sent: Wednesday, December 26, 2001 1:13 PM
Subject: Re: Keynesian Christmas!


> >===== Original Message From "Henry C.K. Liu" <hliu@xxxxxxxxxxxxxx> =====
> >Argetntina should file for bankruptcy under Argentina law and have all
dollar
> >debts discharged by Argentina courts.  Foreign banks will not lend to
> Argentina
> >for a while, which is precisely what Argentina needs: to avoid any new
> foreign
> >debts.  Instead of a currency board, Argentina should proceed with a
monetary
> >regime based strictly on the State Theory of Money.  All Argentina
exports
> must
> >be paid in new Argentina currency, thus creating a global demand of its
new
> >currency.  A JG program can be financed with local currency backed by
future
> >tax revenue. All dollar denominated commodities that Argentina must
import,
> >such as oil, should be put on barter with Argentinan exports. Full
employment
> >should be the starting point to revive the economy.
> >
>
> Dollarization is not the solution -- but Henry is on to something.
>
> Paul Davidson
> Editor, Journal of Post Keynesian Economics
> University of Tennessee
> SMC 523
> Knoxville, Tennessee 37996-0550
> phone # (865)974-4221; fax #(561)737-8262;
> email pdavidson@xxxxxxx
> http://econ.bus.utk.edu/Davidson.html
>
>