[Steve_American]

A quote from a comment to a post in Bill Mitchell's blog.

Formal teaching of neoclassical economics is without reference to money, debt and limits to resources. But when those shiny new economics graduates enter the workforce it’s all about money, debt and finite resources. How absurd is that? They render themselves unemployable in my world as they perpetuate a flawed neoclassical groupthink theology.

The quote says it all.

Why do you-all believe the economists who are always talking about a fantasy world and not the real world that you and I actually live in? WHY?!

This fantasy world has no money or debt, and it has no limit on resources, no markets dominated by corps with monopoly pricing power (OPEC, Amazon, etc.), and no banks {with no money it has no banks, so it doesn't factor the fact that Western banks (incl. banks in Japan) create more money with every loan}, or that most recessions are triggered when private debt gets too much for the people to service the loans they already have and so reduce the national income by having to stop borrowing to spend, spending that gives income to someone.

Can you see that when banks make loans, they create new money, that this money gets spent, that it therefore gives someone more income, that this income as it keeps being re-spent adds to the GDP; so, when the people have so much debt that they can't see how to make the payments on 1 more loan, that they have to stop borrowing and spend less, that this reduces the income of someone, and this reduces the GDP, that this spooks the bankers, so they reduce lending, reducing more incomes, and all those reduced incomes are show up in the GDP total that is being reduced; and that that is the definition of a recession if it lasts for 2 calendar quarters?

Can you see that because the Neo-liberal theory as taught leaves out money and debt, it can't be teaching that private debt getting too large is the cause of most recessions. And so, it can't teach that when Gov. deficit spends and so adds to the national debt (that actually can't ever be paid off and which will never be defaulted on because the Gov. can create the needed money to make the payments), that this situation is to be preferred over growing total bank loans that are the private debt; because this doesn't trigger recessions? [Just yesterday, the Congress approved a spending bill that includes $45 Billion more spending for the Dept of Def that is not being "paid for" with a tax increase or cut in some Gov. program. It is going to be added to the national debt.]

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[Unthinking Majority]

Dude you're an MMT'er.

[Steve_American]

Dude you're an MMT'er.

I know that, I've made a point of telling you-all that many times.

Your point is what?

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[late]

What is going to drive the next wave of economics is still being fought over.

As I've suggested before, take a look at Evonomics.

[wat0n]

This clearly shows Mitchell's readers aren't even economists (and shows the kind of people his nonsense is written for). There are definitely models that incorporate money that are taught at the undergrad level, indeed, it is part of undergrad education to introduce the concept of "money", to define it more formally and to explain why it exists.

Let alone teaching about intertemporal budget constraints (aka debt constraints) and budget constraints themselves, the latter of which is taught at introductory micro.

Why do you talk about stuff you clearly have no idea about?