Saturday, January 1, 2022

Happy New Year and Welcome to the Modern Money Ventures Blog!


Thank you for taking time to read my new blog, Modern Money Ventures.

This blog will explore a range of interrelated topics including finance, economics, law, politics, and culture.

The inspiration for this blog came from learning about a heterodox economic framework known as Modern Monetary Theory (MMT), which completely upended my understanding of economics, finance, and money. MMT proposes, among other things, that nations which create and issue their own currency have no limits on how much of that currency they can issue. Our economy is limited by real resource and political constraints; not financial ones. Taxes and government bonds do not “fund” spending programs for a monetary sovereign nation; it’s actually the other way around - money created by the government funds taxes paid and debt purchased by the non-government sector. Government debt liabilities are assets for the non-government sector. Banks don’t lend out deposits; they create them when they make loans. Much of this is explained in Stephanie Kelton’s fantastic book, The Deficit Myth, which is probably the most important book written about money and economics since Keynes’ General Theory. Indeed, the way that economics has been taught and interpreted in the post-WWII period by our nations’ institutions, both in the public and private sector, has been wrong on many fronts. Money is fundamentally an invention of humans to facilitate the sharing of resources within a society. Understanding what money is, how it works, and the institutions which create and destroy it, is critical for a society to make the best use of its real resources and achieve maximum prosperity.

The purpose of Modern Money Ventures is to build bridges between MMT economists, the investment community, lawmakers, and “mothers and plumbers” (i.e. everyone else with a stake in how we allocate resources as a society). We will use the teachings of MMT as a framework to make better decisions, both for public policy and for private interests. This blog is explicitly non-partisan; indeed, if there is one thing we can take away from recent history, it is that politics are ostensibly arbitrary. We will promote and/or critique specific policy decisions in an apolitical way (one of my pet peeves in the media is how lawmakers are always listed with either a “D” or an “R” next to their name, which automatically triggers biases). We will also use an MMT framework to evaluate trends and flows in the overall economy, and the impact on specific sectors and companies (IMPORTANT: none of this should be taken as investment advice, please do your own research).

My day job is a research analyst for a boutique investment management firm based in NYC. We focus on companies going through some sort of financial stress and take positions in the credit or equity-linked securities of those companies. This blog will remain free from a subscription or ads for the time being, as I believe it is in the public’s interest to better understand these concepts.

Finally, this is a virtual place where writers and commenters will treat each other with respect. We will share thoughts, new ideas, and critiques without being rude to one another. Our focus is on the merits of a person’s arguments, not the tribe they belong to.

Let the games begin!


No comments:

Post a Comment

On Inflation

[Note: I originally started writing this piece on December 23, 2022, then got held up with holiday festivities. More posts for the new year ...