| Dear Reader, Camp Kotok is a place where I go every year to enjoy a weekend of fishing, camping, and lively conversation with some of the most brilliant economists in the world. This year, one of the most hotly debated topics was Modern Monetary Theory (MMT). It’s a concept that has been bandied about among progressive Democrats for some time. MMT is a revival of an early 1900s idea called chartalism. It states that monetarily sovereign countries like the US, the UK, and Japan aren’t constrained by revenues when it comes to federal government spending. In other words, governments don’t need to tax or borrow because they can print as much currency as they want. Upfront and in-your-face money printing as a serious economic proposal. Personally, I think it’s a terrible idea, born out of overconfidence and Pride, our final deadly sin. And I am not alone. Most of the time when I’m talking with my fellow writers and economists, when somebody mentions MMT (also called the “Magic Money Tree”), everybody smiles or chuckles and shakes their heads. The problem is, what seems like a joke is actually gaining traction in mainstream circles. That being said, one of my main objectives is not to let the things I am watching and reading, and the people whom I’m listening to, turn into an echo chamber. That’s the reason why, in my Over My Shoulder service, I make a point of occasionally publishing opinions that run contrary to my own. So I invited another Camp Kotok fellow, Samuel Rines, chief economist at Avalon Advisors, to do an interview with our host Jonathan Roth on the subject. Sam was chosen at camp as the poor soul who had to play the devil’s advocate and defend Modern Monetary Theory... and he made a valiant attempt at finding merit in it. It hasn’t changed my mind about the sheer insanity of MMT. Still, you’ll get a better understanding of the concept by hearing Sam’s explanation—it’s not as simple as you may have been led to believe. Here’s the link to the clip again. Your always happy to hear opposing views analyst, John Mauldin
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P.S. I received some emails from readers asking about our videos. The full interviews with our Over My Shoulder contributors are each 10–15 minutes long, and you’ll be able to get the full-length series at the end of "7 Deadly Economic Sins Week." More on that tomorrow. | 