Re: two currencies and Korean war

["Per Gunnar Berglund" <pgberglund@xxxxxxxxxxx>]

In reply to Ted Winslow:

Per had written before:
> > Consumers'
> > revenues from sales of services to producers amounts to the wage bill W.
> > Therefore the balance between the two W - C will denote the net increase
in
> > producers' financial liabilities, the change by transaction in 'MC'.

Ted wrote:
> All of Y, i.e. profits, rent, interest and wages, is the income of
> households, isn't it?

Per says:
Yes but all of 'income' does not consist of actual transactions between
households and firms. There is an imputed part too. Perhaps you should read
up a bit on national accounting?

Ted wrote:
>Their saving is Y - C.

Per says:
'Their' saving may not be household saving. 'Saving' in national accounting
is a balancing item that has no immediate relation to actual transactions.

Ted wrote:
> This must be equal in a simple
> system to I (investment by firms) all of which, on your assumptions, is
> financed by a "net increase in producers' financial liabilities" to
> households.

Per says:
It is true that investment = saving in ordinary national accounts. Neither
has any basis in actual transactions between households and firms.

The rest of your proposition is nonsense and misrepresents what I said.

Ted wrote:
>  So Y - C equals this  net increase.  How could they be
> different unless Y wasn't equal to C + I?  If the net increase is only W -
C
> what happens to Y - W i.e. non-wage household income?

Per says:
You keep going on in your own little world here, rather than relating to
what I said. I have better things to do than to try pricking your bubble.

I have come to the conclusion that this forum is useless for anybody
interested in a constructive dialogue, so have decided to sign off.

Ciao,
Per

_____________________________________________
Per Gunnar Berglund
CEPA    80 Fifth Avenue, 5th floor    New York, NY 10011
Tel: (212)229-5901, ext.327    Fax: (212)229-5903