This entry is a part of our larger series … “There is no ‘Debt Doomsday’ Approaching“. The first entry in this series can be found here at this link.
We continue the discussion from the last entry.
We often find that many individuals attempt to comment on the economy, and confuse two very basic components of economic functions. Namely, the Fiscal and the Monetary operations of the United States. These are two separate entities that attempt to balance aggregate demand within the economy.
To review from the last entry, the Fiscal branch is composed of Congress and the President that uses Spending, and Income Taxes in an attempt, not to pay back debt … but to balance aggregate demand of the entire economy. The Monetary branch is composed of the Central Bank, or Federal Reserve Bank of the United States who monitors economic data to balance interest rates; again, not to ‘pay back debt’. But in an attempt to balance aggregate demand of the economy.
But how exactly do these two branches of our ‘economic ecology’ function?
This is vital to understand.
Remember, that the entire focus and surrounding context of this series we are presenting is to demonstrate that there is no “Debt Doomsday” approaching for the United States economy; in which the Federal Government is trying to ‘raise revenue’ to pay back ‘debt’. A story that many who peddle fear and doom like to sell the uninitiated. If you understand how and why these two branches of economic policy function … ones can more easily see that the above ‘Debt Doomsday’ narrative is simply a boogeyman story, with no basis in fact.
Therefore, this entry of Mr. Delzio’s discusses the functions of each branch as they attempt not to back back debt, but balance aggregate demand …
(After the following video, you can find the next video in this series at the following link …)