This quick quote from a brilliant local scholar reminds us that neither our elected leaders nor experts in economics really know what they're doing whilst awarding truckloads of free money to their political supporters.
Money line . . .
Modern Monetary Theory (MMT) says governments have room to rev up their economies with fiscal spending, and argues that inflation -- rather than deficit or debt levels -- is the metric that budget authorities need to keep their eye on.
“One thing the mainstream has caught on to is allowing the economy to run a bit hotter," says Scott Fullwiler, an MMT economist and associate professor at the University of Missouri-Kansas City.
“That’s the thing we’ve been hitting on for decades." Unfortunately, says Fullwiler, economists haven’t devoted enough attention to the question of what a safe maximum speed would be -- and have focused too much on central banks, even though it’s now fiscal policy that is driving recoveries.
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Meanwhile - as part of a profound shift in economic thinking that's gathered pace in the past year - a whole range of other indicators once relied on to flag trouble ahead are falling out of favor.