Modern monetary theory - Mitchell and Wray Q10

This is Question 1 in a series of Modern monetary theory interviews - Professors Bill Mitchell and Randy Wray. See billy blog (http://bilbo.economicoutlook.net/blog) for more information on this approach to macroeconomics. You can also get more information from Centre of Full Employment and Equity (http://e1.newcastle.edu.au/coffee).

Questions asked:
I take it that the cash rate underpins all other interest rates in the economy? Is that the notion? That by controlling that one they have a sort of indirect control over all others?

Category:

Education

Tags:

• Modern monetary theory
• Professor Bill Mitchell
• Professor Randy Wray

[axe863]

@rphaigh Value is derived by subjective dynamics, economists stopped being objective theorists after Marx.

[rphaigh]

At first it is puzzling the professors never talk about the role of the medium of exchange as a store of value. To avoid reference to a fiat currency as a fiat and to rename it a sovereign currency is to obscure the role of the currency as a store of value.

Because gold requires man-hours and capital equipment to create it, its value is inherent in itself. It is no one elses liability.