Re: Which is it, "Creditary" or "State"?

[Gunnar Tómasson <gunnar.tomasson@xxxxxxxxxxx>]

Bill:

Re. the following:

> The "Creditary" Circuit:  Three primary sectors:
> Banks - Firms - Consumers.  Treasury aggregated with
> Firms.  Fed aggregated with Banks.  Firms and
> Consumers spend Bank credit.

Comment:

In the first instance, the "Consumers spend Bank credit" bit is NOT part of
the "Creditary" Circuit.

For, as "Suppliers of Factor Services to the Production Process", Consumers
are recipients of Bank Credit obtained by Firms to finance purchases of
"Factor Services".

In the real world, the "Consumers spend Bank credit" bit comes into play
when "savings" out of MALDISTRIBUTED Factor Incomes threaten to leave Firms
without Customers for the Goods and Services which they bring to market.

Gunnar





----- Original Message -----
From: "William B. Ryan" <w_b_ryan@xxxxxxxxx>
To: <pkt@xxxxxxxxxxxxxxxx>
Sent: Tuesday, August 12, 2003 12:04 PM
Subject: Which is it, "Creditary" or "State"?


> The "Creditary" Circuit:  Three primary sectors:
> Banks - Firms - Consumers.  Treasury aggregated with
> Firms.  Fed aggregated with Banks.  Firms and
> Consumers spend Bank credit.  Firms normally in
> deficit to account balances held by Firms and in
> deficit to account balances held by Consumers -
> accommodated by availability of credit from Banks.
> Production represented by efflux into account
> balances held by Firms and Consumers.  Consumption
> represented by reflux from Consumers to Firms.
> Desire to consume is *imperative* to produce.
>
> The "State" Circuit:  Two primary sectors:
> Government - Private.  Government is consolidated
> balance sheet: treasury - fed.  Private is
> consolidated balance sheet:  firms - commercial banks
> - consumers.  Transactions between firms, commercial
> banks and consumers "net to zero."  Net financial
> assets held by Private derives from deficit of
> treasury/fed to Private.  Tax liability creates
> *imperative* to accept twintopt ("that which is
> necessary to pay taxes") on Government's terms to pay
> tax in reflux.  Private "leverages" twintopt
> permitted to be retained into "money" required for
> trade.
>
>
>
>
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