Rate Hikes Are Inflationary, Says Warren Mosler, Godfather of Modern Monetary Theory (MMT)

Warren Mosler, founder of Valance Co., Inc. and author of “The 7 Deadly Innocent Frauds of Economic Policy,” is widely viewed as the intellectual godfather of Modern Monetary Theory (MMT), a framework for understanding money and debt which underscores a government’s ability to print money to pay for goods and services without relying necessarily on borrowing or taxation. Mosler joins Forward Guidance to apply these ideas to today’s financial issues. He argues why a failure to raise the U.S. debt ceiling would be truly catastrophic, and he makes the case that the Fed’s rate hikes are actually contributing to inflation, rather than fighting it, because the government is printing more money in order to pay its debt. Filmed on May 30, 2023. ____ Follow Warren Mosler on Twitter https://twitter.com/wbmosler Follow Jack Farley on Twitter https://twitter.com/JackFarley96 Follow Forward Guidance on Twitter https://twitter.com/ForwardGuidance Follow Blockworks on Twitter https://twitter.com/Blockworks_ Warren’s website: https://moslereconomics.com/ Warren’s book and other writings: https://moslereconomics.com/mandatory-readings/ ____ Use code GUIDANCE20 to get 20% off Permissionless 2023 in Austin: https://blockworks.co/event/permissionless-2023 Research, news, data, governance and models – now, all in one place. As a listener of Forward Guidance, you can use code GUIDANCE10 for a 10% discount when signing up to Blockworks Research https://www.blockworksresearch.com/ ____ Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter: https://rb.gy/5weeyw Market commentary, charts, degen trade ideas, governance updates, token performance, can’t-miss-tweets and more. Subscribe to the Blockworks Research “Daily Debrief” Newsletter: https://rb.gy/feusos ____ Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets. ____ (00:00) Risk Of Government Unwind Would Be Catastrophic (07:24) "Money Is Just A Series Of Dots Going On And Off In People's Bank Accounts" (14:52) The Federal Reserve Prints Money (19:07) The Government Spends First, Taxes and Borrows Second (31:23) Permissionless (32:01) Quantitative Easing Does Not Have An Actual Effect On The Economy (33:17) High Interest Rates Mean More Deficit Spending (48:29) Challenging The Narrative of Volcker As The Slayer Of Inflation Dragon (54:00) Challenging The Wage Price Spiral (01:01:13) Currency Itself Is A "Public Monopoly" (01:04:04) We Are NOT In A Recession, Says Mosler (01:11:21) Is The Solution To Inflation To Cut Government Spending? (01:16:30) Blockworks Research (01:17:28) The Debt Ceiling (01:24:08) The Dollar