Modern Monetary Theory (MMT)
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Though the term Modern Monetary Theory (MMT) was introduced in the early 1990s (some say in the 1970s), it is now more commonly used than ever. It seems that the parabolic growth in U.S. debt, as well as the start of the first round of Quantitative Easing (QE1) in November 2008, was when the idea really began to gain traction. According to “What Is Modern Monetary Theory? Understanding the Alternative Economic Theory That’s Becoming More Mainstream,” it is defined as follows:
Modern Monetary Theory (MMT) is an economic theory that suggests that the government could simply create more money without consequence as it’s the issuer of the currency, according to the Federal Reserve Bank of Richmond. As part of this theory, the thinking is that government deficits and national debt don’t matter nearly as much as we think they do. (Lockert)
If the Federal Reserve had not been created in 1913, then it probably would not even be possible for the government to create so much money by printing it or entering it digitally into a computer. However, following the Panic of 1907, the banking system and the economy were on the verge of collapse, which provided an opportunity for “the Fed” to come into existence. Specifically, in 1910, powerful men of the time, selected by Senator Aldrich, gathered to formulate a plan to address the economic troubles, which eventually led to the Federal Reserve Act.
Ever since the Fed was created, and especially since the U.S. went off the gold standard in 1971, the dollar has depreciated drastically at an increasing rate. When MMT was first introduced, it wasn’t particularly popular for a variety of reasons, but it is now being more widely accepted. However, as we are currently seeing in the U.S. at the time of this writing, MMT can certainly lead to inflation and has its problems. It isn’t the easy remedy that some, such as leading MMT proponent Stephanie Kelton, make it out to be. Can you really just create infinite amounts of money? If so, couldn’t we all be millionaires?
One of the biggest problems is that the country implementing this type of policy needs to be monetarily sovereign. As we have seen in the Weimar Republic, Venezuela, and Argentina, printing large sums of money (thereby increasing the money supply dramatically) can lead to extremely high levels of inflation. Even though other external factors likely contributed to these catastrophes, these examples show just how destructive this type of “theory” can be and reinforce basic common sense. Check out this article if you want to learn more about the inflation figures:
Which way is the stock market headed?
Theoretically, the stock market can only move in three major directions: up, down, or sideways. People who make market predictions usually predict where the market is headed within a specific timeframe. Therefore, in addition to predicting the direction, they usually predict the timing as well. In order to be “correct,” they must not only predict the direction of the market but also get the timing right…
As with the game of Monopoly and the concept that the “bank never goes broke” because it can always print more money, the destruction of a fiat currency itself can ultimately destroy an entire economy. If the U.S. dollar loses its status as the world’s reserve currency, as some say is currently happening, U.S. citizens will be the ones who get the rug pulled out from under them.
As I discuss in my other article,…
What are the Chances of Hyperinflation—A Common-Sense Viewpoint?
If you are wondering whether the U.S. dollar, the world’s reserve currency, could experience hyperinflation, then I would say…
…the Fed is now trapped because raising interest rates too much will cause the economy to deteriorate and the overall debt burden to increase, whereas it can lower interest rates only so much before they reach zero or potentially go negative. It looks like we are heading more and more toward “The Great Reset,” in which things such as social credit scores, ESG scores, a one-world government, and total government control could become realities. This would be a situation in which the elites have absolute authority over the masses, potentially under the leadership of the final Antichrist described in the Book of Revelation. As mentioned in the book The Great Reset: Joe Biden and the Rise of 21st Century Fascism:
Modern monetary theory throws out the dial [referring to raising and lowering interest rates] and replaces it with a gigantic control panel full of levers, knobs, and switches that allow bureaucrats to manage the economy and society as they see fit. Sounds like something people calling for a Great Reset of the global economy would like. Huh. (135)
Clearly, no one knows exactly what the future entails, but the way this current theory is being applied is much like a boa constrictor slowly squeezing its prey. What started out with “the Fed” has now led to “MMT,” which will likely eventually lead to “the Great Reset” or the “NWO” (New World Order).
If this sounds a bit drastic to those living in the United States of America, know that American Exceptionalism without God is a myth, and the decay of this nation supports this idea. However, American Exceptionalism under God is true.
Other countries, such as China, seem to be gaining economic ground and are trying to move away from U.S. dollar hegemony, as this article is being written.
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Works Cited
Beck, Glenn, et al. The Great Reset: Joe Biden and the Rise of 21st Century Fascism. Forefront Books; Mercury Ink, 2022.
Lockert, Melanie. “What Is Modern Monetary Theory? Understanding the Alternative Economic Theory That’s Becoming More Mainstream.” Business Insider, Business Insider, 22 July 2022, https://www.businessinsider.com/personal-finance/modern-monetary-theory#:~:text=Modern%20Monetary%20Theory%20(MMT)%20is,Federal%20Reserve%20Bank%20of%20Richmond