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RE: MODERN MONETARY THEORY - can anyone explain major differences between MMT and current monetary system?
Thank you for your amazing comment @achim03
Very informative. And you shocked me when you mentioned that MMT doesnt produce inflation. I always thought that increased supply (over demand) will lower value of FIAT currency. And as such - it would create inflation.
Meaning the money will always go where the ROI is highest. It will go into share markets or real estate or bonds, accordingly...
If money would end up in property market, then it will increase cost of rent. And that will impact prices of everything. Wouldn't it be ... inflation?
The more money that is printed, the more we assist to a bad allocation of assets
You nailed it! Again big thx for your feedback.
Cheers, Piotr
In a way we are already living in a world of MMT with QE and as a result I always wondered why there was not more inflation. I believe it is because the inflation is kind of hidden within bubbles but when these bubbles explode we will have the same results as if we would have with an increased inflation. I saw this in Turkey. A simple tweet from D. Trump about taxing steel was enough to produce a devaluation of the currency of 20% within a couple of days.
Instead of coming little by little the inflation manifests in bursts and is therefore much more dangerous and imprevisible.
Best regards,
Achim