MMT undermines trust in U.S. Currency
Das ’21 [Satyajit; 12-09-2021; “Spending without taxing: now we’re all guinea pigs in an endless money experiment”; Internationally respected expert in finance, former Australian banker turned consultant; The Guardian; https://www.theguardian.com/commentisfree/2021/dec/10/spending-without-taxing-now-were-all-guinea-pigs-in-an-endless-money-experiment \\pairie]
Sixth, there are implications for financial stability. Lower rates, the result of central bank debt purchases, and inflation fears might drive a switch to real assets, increasing the price of property and shares representing claims on underlying cashflows. It may encourage hoarding of commodities. This exacerbates inequality and increases the cost of essentials such as food, fuel and shelter. Fear of debasement of the value of paper money, in part, is behind unproductive speculation in gold and cryptocurrencies.
Seventh, MMT might undermine trust in the currency. Instead of spending the payments, citizens may question a world where governments print money and throw it out of helicopters.
Finally, Japan’s use of persistent deficits to boost short-term economic activity and incur government debt (currently more than 260% of GDP, compared with a global average of about 100%) does not prove the effectiveness of MMT. The country’s circumstances are unique and it has been mired in stagnation for three decades with its GDP largely unchanged.