"My understanding of why the US can print money without regard for consequences is because there are always "buyers" for US dollars"
That's the usual view.
It isn't correct.
The US "prints" money because foreign US dollar earners don't spend all they earn. They "save". Which takes the dollars out of circulation.
And they do that largely because they end up on the asset side of some bank somewhere who then discounts them into the local currency.
That process locks the dollars (or dollar financial asset like a Treasury) in place. To get rid of the dollars they have to get rid of the local currency too.
All you can do is offset the net non-government savings (which includes foreigners. They are little different in the MMT view). Any more and you get inflation.
Argentina not only can do it, that is exactly what they do do as a necessary function of the way a banking system works. Balance sheets expand and contract through the day.
Again to the extent that there is excess saving in ARS, the government sector could offset that by simply hiring the resulting unemployed and paying them.
That there is unemployed tells you that there is excess saving. As Warren Mosler would say "if there are unemployed then we are overtaxed for the size of government we have".
That's the usual view.
It isn't correct.
The US "prints" money because foreign US dollar earners don't spend all they earn. They "save". Which takes the dollars out of circulation.
And they do that largely because they end up on the asset side of some bank somewhere who then discounts them into the local currency.
That process locks the dollars (or dollar financial asset like a Treasury) in place. To get rid of the dollars they have to get rid of the local currency too.
All you can do is offset the net non-government savings (which includes foreigners. They are little different in the MMT view). Any more and you get inflation.
Argentina not only can do it, that is exactly what they do do as a necessary function of the way a banking system works. Balance sheets expand and contract through the day.
Again to the extent that there is excess saving in ARS, the government sector could offset that by simply hiring the resulting unemployed and paying them.
That there is unemployed tells you that there is excess saving. As Warren Mosler would say "if there are unemployed then we are overtaxed for the size of government we have".
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