Emeritus Prof Christopher MayMar 9

As their popularity rises the Green Party of England & Wales will see its policies gain more attention & criticism in the media.

The FT has run a long analysis of various policies this morning, suggesting that while popular, they may be under-estimating the need to find ways to convince bond-market actors their economic policies are 'credible'.

If the GPEW is not already reaching out to calm such actors, they might want to think about quietly (and pragmatcally) doing so.

#Greens #economics

Show threadMartin RundkvistMar 9
@ChrisMayLA6
Maybe bond-market actors do not have our best interests at heart.
Show threadThe Sleight Doctor 🃏🍉Mar 9
@mrundkvist @ChrisMayLA6 I wouldn't be the first to point out that they don't even understand macroeconomics! A currency-issuing government can always cover the interest on bonds, can never become insolvent, and - this is the kicker - does not even need to "borrow" from markets in order to spend. If the UK can spend money into existence for quantitative easing (QE) or Covid measures, then it can do so for any other purpose. 🤷🏻‍♂️
Show threadEmeritus Prof Christopher MayMar 9

@ApostateEnglishman @mrundkvist

However, where the monetarists are right is that this is inflationary.... in the UK this is hidden by the impact of QE on asset prices (see the housing market) being left out of the metrics for inflation.... I'm not against 'spending money into existence' but it needs to be managed to ensure the expansion in the money supply is directed into productive investment not inflating (rentier) assets.... in this sense Reeves 'new' fiscal rules help (if she'd use them)

Show threadThe Sleight Doctor 🃏🍉Mar 9
@ChrisMayLA6 @mrundkvist For once, we somewhat disagree! The monetarist view that expanding the money supply is always inflationary is overly simplistic: in order for there to be runaway inflation, there has to be too many pounds sterling chasing too fews goods and services. In other words, where there is unused 👉🏼productive capacity👈🏼 in your economy, national spending can't add to inflation. If we have the raw materials, willing and able workforce, ecological space etc., we can always afford it.
Show threadEmeritus Prof Christopher May

@ApostateEnglishman @mrundkvist

I'm not sure we are disagreeing; I think the monetarist point is right where there is now dynamic of advance for the economy & in the UK that was channelled into property.... but your point & my last point are parallel - I would see 'productive investment' as the driving of the Green Transition & infrastructure investment - I agree the monetarist point it simplified but it is not (entirely) without merit when linked with other analytical approaches in he round

Mar 9 at 9:49amWeb