MMT dies when you’re over-financialized because backstop that makes MMT work is real production. Japan didn’t spent its fiscal capacity on real production and is furthermore highly dependent on imports and thus currency value. Over-financialization disrupts MMT’s core mechanism.
Robin Brooks
@robin_j_brooks
01-22
Japan is where MMT goes to die. MMT says a monetary sovereign like Japan can't run out of fiscal space as long as inflation is low. But the rise in yields & collapse in the Yen - even as inflation is low - say the opposite. A response to @StephanieKelton:
https://robinjbrooks.substack.com/p/japan-where-mmt-goes-to-die…
You’ve put into words what I’ve been feeling for years about MMT
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