Covid 19 - the end of Capitalism?

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skydancer in reply to @Brommers

For a fiat currency, no. M1 money supply is wholly at the discretion of the nation state/central bank.

So you're saying that to increase the money supply the state can just do this without borrowing from anyone?

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NotThamesWater in reply to @skydancer

Simplistically, yes.

To do so has ramifications both internally (e.g. inflationary pressures) and externally (e.g. exchange rates and balance of trade payments) to the state.

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skydancer in reply to @NotThamesWater

Hmmm.

Sorry I'm being completely dumb (despite A-level in economics -grade E)

Austerity is political rather than economic, causing contraction of the state, while benefiting the 'haves'?

Perhaps this crisis will really show laissez-faire economics as a crap approach

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