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How so? http://neweconomicperspectives... Banks don't lend reserves. Reserves are driven endogenously by banks expanding their balance sheets making loans. After that they back fill inter-bank swapping of reserves and ultimately go to the FED (US example) to get reserves at the penalty rate.

Yes, we don't have an informed public, mostly about the nature of money. People who have money (aka the 1%) want you to believe there is a finite amount of the stuff, and that the most powerful nation in the history of mankind needs to tax money from the people when only it has the sole legal right to create that money in the first place.

ALL money comes from the government originally. So powerful was this myth that until very recently, money always had the likeness of the ruling sovereign on them as it literally was a projection of his power. We see a relic of this today with the Secret Service. Similar services existed in the past to protect kings, and now presidents, and always prosecuted counterfeiters as traitors directly attacking the king.

What is sad is this should be a progressive thing. The only serious progressive economists today are well aware of how money functions.

See this:

http://moslereconomics.com/wp-...

http://neweconomicperspectives...

The same people saying Trump is wrong in this instances are also the idiots who believe banks lend grandma's savings. Banks don't lend money, they create debts, which are counted as assets via double entry bookkeeping. Exactly how Trump is doing it.

It is only a logical error to a fool who believes money grows on trees or is dug up from the ground and there is a fixed supply of it. It's just a number. It's all made up. It is a political construct like all others that keeps us from killing each other like wild animals.

https://www.youtube.com/watch?...

If you know of a way a government can pay for itself without collecting taxes or taking natural resources from the people (or simply descending into anarchy), I would love to hear your solution.

Money is created by the government. It must spend (or give) it out before it can collect it back in tax.
Follow that logic and you will have discovered Modern Monetary Theory.

Let's look at your claim that the inflation rate has been near zero for three decades:

http://www.bls.gov/data/inflat...

$1000 in 1986 is the equivalent of $2195.68 today

That supposed "near zero" inflation rate has reduced the value of $1 to 45 cents

As for the Federal Reserve not printing money, here is how Alan Greenspan described the process of the Federal Reserve buying over $2 TRILLION in US Government securities:

http://neweconomicperspectives...

“Now, you might ask the question, well, the Fed is going out and buying 2 trillion dollars of securities – how did we pay for that? And the answer is that we paid for those securities by crediting the bank accounts of the people who sold them to us, and those accounts, at the banks, showed up as reserves that the banks would hold with the Fed. So the Fed is a bank for the banks. Banks can hold deposit accounts with the Fed, essentially, and those are called reserve accounts. And so as the purchases of securities occurred, the way we paid for them was basically by increasing the amount of reserves that banks had in their accounts with the Fed."

They "credited the bank accounts of the people who sold them". That is creating money out of thin air.

The US is the most well-suited country on the planet, for pursuing a Job Guarantee as an official and permanent government policy.

What this is, is a government provided jobs program (think 'New Deal Forever', but with a much wider range of potential jobs available - remember, government can afford to hire people to perform almost any kind of socially beneficial roles, the jobs don't have to turn a profit), where people are temporarily employed at the minimum wage, and then workers are gradually re-employed by the private sector, as the private economy improves.

This policy:
1: Helps the private sector recover in economic bad times (through boosting Aggregate-Demand/GDP).
2: Reduces both Public and Private Debt burdens in the medium/long run (by boosting the 'GDP' component of 'Public/Private Debt vs GDP', and providing workers with money to pay down debts)
3: Works against the threat of deflation (when banks are unable to increase the amount of money in the economy through loans, this public spending makes up for that).

4: Provides a more efficient way for preventing excessive inflation (presently, central bank policies for avoiding inflation, involve constricting the economy and increasing unemployment - a Job Guarantee is more efficient, as the central-bank/government can constrict parts of the private economy that are overinflating, flowing workers into the Job Guarantee, where they can be put to work on jobs that put less of a strain on inflation, or e.g. infrastructure jobs which make the economy more efficient and thus less inflationary).

5: This policy can put a permanent end to unemployment - instead of wasting workers potential and letting their skills stagnate through unemployment (as well as suffering the negative health effects of unemployment), this puts them to good use an keeps them sharp.

6: Less job insecurity, as private sector business will have to offer better incentives to lure workers out of the minimum wage Job Guarantee, and no worker will ever be in fear of having no job again due to the Job Guarantee (increasing workers bargaining power, relative to employers).

7: Disability and other serious impairments will no longer be a barrier to having a job, in many (maybe most) cases, as the Job Guarantee would be able to offer almost any kind of work that is socially beneficial. The US already has a Job Guarantee of sorts for disabled folk, though not of the same breadth.

The Chartalist/Modern Money branch of the Post-Keynesian economic school have pioneered this idea, and they have an entire complete policy framework that can be used for implementing this - more people should be learning about this, and demanding that it be implemented.

Its not debt. If it were a state, it would be a debt. Think of it as a deposit in the private economy. http://neweconomicperspectives...

Perhaps you missed the second part?

So let’s continue the exercise and, as promised, extend the argument to the more realistic open-economy in which we actually live.

Of course, congress has the power to mint money. Hell the treasury can right now. As mush as we want. One cannot run out of money...The limitation is inflation. Only inflation. Its not debt. Its not tax dollars. Its inflation. The question the becomes, are we at risk of inflation if we helicopter-drop billions of dollars on the people? Maybe. Maybe not. Depends on how much capacity there is to meet the increase in demand. http://neweconomicperspectives.org/p/modern-monetary-theory-primer.html

http://neweconomicperspectives.org/p/modern-monetary-theory-primer.html so what ever.

Because the debt is imaginary.

http://neweconomicperspectives.org/2013/03/the-myth-of-debt.html

Welcome to modern money theory. The debt cane be easily paid off by declaring the Federal Reserve ILLEGAL. Obviously some president tried to do that, like JFK, and we know all what happened to him.

Start using money creation for funding government instead of giving private banks exclusive use of it, and limit government spending based on hitting the inflation target; you can pay for this and much more beyond it.

I know neoliberals/neoclassicists/libertarians will skewer me for even suggesting this (and will probably get downmodded to hell), and I know 'conventional knowledge' says using money creation for funding is an unspeakable evil, but when you break this taboo and purposely limit spending by the inflation target, it transforms much of what people think they know about economics.

Post Keynesian's, like Steve Keen (the only person to both predict and model the current economic crisis before it developed), Stephanie Kelton, and Bill Mitchell (among many others), are going a long way towards dragging economics out of the dark ages, and towards developing it into a proper science.

It's quite hard to believe that economics, in its current neoclassical form, has survived the economic crisis and is still taken credibly; virtually the entire field outside of heterodox schools, failed to spot something as blindingly obvious as private-debt vs GDP, as a massive indicator of an upcoming crisis.

i posted a wrong link.

this is the description how PCS will not cause inflation.

http://neweconomicperspectives.org/2012/12/platinum-coin-seigniorage-issuing-debt-keystroking-deficit-spending-and-inflation.html

You are assuming the extra money generated will go to the rich. A proper full employment social program and expansion of infrastructure spending will ensure money flows to the bottom of the ladder.

We don't need bond investors, as there is no need to borrow money anymore. We can issue "ceremonial" or "souvenir" bonds, and the interest rate at OUR choosing. Either pay or leave.

I suggest you to read the following article about the illusion of the national debt:

http://neweconomicperspectives.org/2012/12/americas-deceptive-2012-fiscal-cliff-part-2.html#more-4107

We have enough natural resources to cut off our imports. Then we can also utilize our world's strongest military to nationalize resources around the world for our interests.

Saying "the only way is to pay out" is the same is subduing yourself for being raped by the international bankers.

The only legitimate solution to the debt crisis. The treasury should immediately mint a $1 quadrillion platinum coin and deposit to the fed, using the proceeds to pay off ALL obligations.

http://neweconomicperspectives.org/2012/12/new-msm-trillion-dollar-coin-wave-heres-the-big-story.html

Read carefully if you still believe that will be inflationary. For those who don't want to be "otaku" on those subjects, in one sentence: Debt repayment by PCS will not be inflationary. Starting new spending is inflationary.

By doing so, the power of the Federal Reserve ( to inflate money supply) is stripped and going back to the government, exactly what Ron Paul has tried to achieve.

IMHO, the PCS Hack gives to the presidency the power to prevent an abuse of power by the Congress, namely the debt ceiling legislation itself, and also gives the President the power to avoid interest bearing debt instrument-based financing of Congressional deficit spending appropriations if he/she desires. I think both of these are very good things, especially since the key power of controlling the purse strings still remains with the Congress, and not with the President. It seems to me that any greater leverage that falls to the President as a result of using PCS is leverage that can always seized back by Congress anytime it wants to do its collective job and represent the majority of the American people. On the other hand, if it wants to continue to represent narrow and plutocratic interests seeking to block any Federal spending that doesnâ(TM)t directly benefit them, then PCS profits may be viewed as a check on such an abuse of power by the Congress, and a reminder to Congress that the âoehow are we gonna pay for itâ excuse for not legislating Federal programs people desperately need won't work anymore!

Your understanding has been shaped by a corporate controlled media.

For one, perjury is a crime covered by RICO. Goldman Sach's robosigning scandal where they committed wide spread perjury for profit is undeniably a "pattern of racketeering activity" as defined by RICO. Why did Obama's justice department pressure state AGs to settle instead of pushing for criminal punishment?

But that's small potatoes. The real problem came from "stated income loans". AKA "liars loans". The banks were informed by Congress and the FBI that liars loans were over 90% fraudulent. In response, the banks INCREASED the amount of liars loans that they issued. I don't see how this can be anything but encouraging and profiting from fraud. AKA, racketeering.

Don't take my word for it. Bill Black, the exact same guy who put all those bankers in jail under Reagan says that fraud was the root cause of the 2008 crisis, and responsibility for that fraud lies squarely on the banks. Why isn't anyone listening to him?