November 16, 2018

The Longbon fake news

Comment on Alan Longbon on ‘Good News: The U.S. Government Runs A $100B Deficit In October 2018, The Private Sector Runs A $100B Surplus’


Alan Longbon jubilates: “The US budget deficit is $100 billion in October 2018; this is a net expansion of income and savings in the private sector and explains the rebound in markets. The good news is that dollars are being added to the economy by the Federal government, allowing the private sector to post a $100 billion surplus. Private credit growth has rebounded this month and made a $17B contribution to aggregate demand and fiscal flows.”

There is the household-, business-, government- and foreign trade-sector. The “private sector” is an MMT swindle.#1, #2, #3, #4

The general macroeconomic Profit Law reads Qm≡Yd+(I−S)+(G−T)+(X−M). Let’s simplify it to Qm≡−S+(G−T). Then Alan Longbon’s message reads correctly: The US budget deficit, i.e. G−T, is $100 billion in October 2018. Private credit growth has rebounded this month and made a $17B, i.e. dissaving −S=$17B.#5

Ergo, monetary profit Qm increased to 117B. Much to celebrate for the Oligarchy. Special thanks to Mr. Trump for the exploding budget deficit.#6

Good news for the oligarchy is terrible news for the WeThePeople.

Egmont Kakarot-Handtke

#1 MMT: Money-making for the one-percenters
#2 Down with idiocy!
#3 The Kelton-Fraud
#4 How MMT makes everybody happy
#5 Secret Champagne for the MMT gods
#6 Keynes, Lerner, MMT, Trump and exploding profit