A few weeks ago, a paper entitled "Why Positive Money is Wrong: An Obligations Analysis of Broad Money Growth" was published by Mike King, a writer and academic whose book "Quakernomics: An ethical capitalism", was published in 2014.
Graham Hodgson (Guest Author)
In his August 5th post at Bank Underground ("a blog for the Bank of England's staff to share views that challenge - or support - prevailing policy orthodoxies") Fergus Cumming, a member of the Bank's Monetary Assessment and Strategy Division, discusses helicopter money proposals. He explains "why such a policy is different to quantitative easing, why it is unlikely to have much impact relative to conventional fiscal measures and the pitfalls associated with pursuing it".
The BBC published an article on Saturday "Ecuador gives details of new digital currency" reporting that the Central Bank of Ecuador was to issue a digital currency. The story apparently originated with the New Delhi Television (NDTV) technology team, to which the BBC provides a link. The BBC report is largely a rewrite of the NDTV article but claims that the money is to be used to pay civil servants, which is flatly contradicted by the NDTV article, and which apparently comes from an August 24th piece in the Wall Street Journal attacking the plan. The official currency of Ecuador is the US dollar with coins denominated in fractions of a dollar issued by the Central Bank and The WSJ article labelled the proposals "an escape hatch to get out of dollarization."
We need to reform a money system that no longer serves the needs of the public This article appeared originally on the Sheffield Political Economy Research Institute's website
Since at least the 1960s, central bankers have, in their ones and twos, been quietly airing the message through ill-reported speeches and evidence to official committees that money is created by private banks when they make loans. But in their pronouncements targeted at the general public they have persisted in reiterating the fictions promoted by economics textbooks about relending deposits and reserve requirements and the money multiplier.