Jamie Smith
@jgs952.bsky.social
Physicist, engineer, amateur economist.
Your car insurance company probably quites like holding your car insurance debt as its asset of deferred payment until they come to settle.
You're really not correct here. Each time you try to refute something you seem to misunderstand and talk about a different aspect.
If IOU, you have an asset.
You're really not correct here. Each time you try to refute something you seem to misunderstand and talk about a different aspect.
If IOU, you have an asset.
January 8, 2026 at 12:01 AM
Your car insurance company probably quites like holding your car insurance debt as its asset of deferred payment until they come to settle.
You're really not correct here. Each time you try to refute something you seem to misunderstand and talk about a different aspect.
If IOU, you have an asset.
You're really not correct here. Each time you try to refute something you seem to misunderstand and talk about a different aspect.
If IOU, you have an asset.
You're still not understanding that an asset to you is a liability to the government.
Your phone bill debt is your phone company's asset. So they probably quite like holding that, yes.
Your phone bill debt is your phone company's asset. So they probably quite like holding that, yes.
January 7, 2026 at 11:16 PM
You're still not understanding that an asset to you is a liability to the government.
Your phone bill debt is your phone company's asset. So they probably quite like holding that, yes.
Your phone bill debt is your phone company's asset. So they probably quite like holding that, yes.
I'd gladly accept them because I know I can use them to redeem my 8 RM debt to you later on and net save 2 RM for future use.
Would you agree that in "RM token" terms you're in neg. equity and I'm in +ve equity? And that after I pay my 8 RM debt by handing 8 back, you'll be in 2 RM of debt to me?
Would you agree that in "RM token" terms you're in neg. equity and I'm in +ve equity? And that after I pay my 8 RM debt by handing 8 back, you'll be in 2 RM of debt to me?
January 7, 2026 at 9:42 PM
I'd gladly accept them because I know I can use them to redeem my 8 RM debt to you later on and net save 2 RM for future use.
Would you agree that in "RM token" terms you're in neg. equity and I'm in +ve equity? And that after I pay my 8 RM debt by handing 8 back, you'll be in 2 RM of debt to me?
Would you agree that in "RM token" terms you're in neg. equity and I'm in +ve equity? And that after I pay my 8 RM debt by handing 8 back, you'll be in 2 RM of debt to me?
Sigh. I hope you're not trolling me and just genuinely don't understand. Let me try again.
Let initial conditions be that I owe you 8 "Real Macro" pieces of paper.
Then, if you want some sugar from me, do you agree that you can write "IOU 1 RM" on 10 pieces of paper and buy my sugar with them?
Let initial conditions be that I owe you 8 "Real Macro" pieces of paper.
Then, if you want some sugar from me, do you agree that you can write "IOU 1 RM" on 10 pieces of paper and buy my sugar with them?
January 7, 2026 at 9:42 PM
Sigh. I hope you're not trolling me and just genuinely don't understand. Let me try again.
Let initial conditions be that I owe you 8 "Real Macro" pieces of paper.
Then, if you want some sugar from me, do you agree that you can write "IOU 1 RM" on 10 pieces of paper and buy my sugar with them?
Let initial conditions be that I owe you 8 "Real Macro" pieces of paper.
Then, if you want some sugar from me, do you agree that you can write "IOU 1 RM" on 10 pieces of paper and buy my sugar with them?
Right. So change the rules and you accept what I've given you is perfectly consistent accounting. And in nations where those rules don't apply, you're even wrong on that point. Do you agree?
January 7, 2026 at 9:24 PM
Right. So change the rules and you accept what I've given you is perfectly consistent accounting. And in nations where those rules don't apply, you're even wrong on that point. Do you agree?
So not "accounting 101" like you said then haha just a human made law which only applies in the US. Like I said, the UK's Consolidated Fund runs negative every day as the state spends (representing that negative fin. equity) before taxes get redeemed or net saving is adjusted to bond form.
January 7, 2026 at 9:15 PM
So not "accounting 101" like you said then haha just a human made law which only applies in the US. Like I said, the UK's Consolidated Fund runs negative every day as the state spends (representing that negative fin. equity) before taxes get redeemed or net saving is adjusted to bond form.
Hahah what do you even mean it violates accounting 101?
Can you genuinely not understand how someone can write "IOU 100" on a piece of paper and give it to someone?
Can you genuinely not understand how someone can write "IOU 100" on a piece of paper and give it to someone?
January 7, 2026 at 9:05 PM
Hahah what do you even mean it violates accounting 101?
Can you genuinely not understand how someone can write "IOU 100" on a piece of paper and give it to someone?
Can you genuinely not understand how someone can write "IOU 100" on a piece of paper and give it to someone?
I've stripped everything back to the simplest it can be.
The state sector can spend because someone in the non-gov sector agrees to hold their liability. The gov goes into neg equity which is matched by the +ve equity of the non-gov. Everything financial sums to zero at all times.
The state sector can spend because someone in the non-gov sector agrees to hold their liability. The gov goes into neg equity which is matched by the +ve equity of the non-gov. Everything financial sums to zero at all times.
January 7, 2026 at 8:52 PM
I've stripped everything back to the simplest it can be.
The state sector can spend because someone in the non-gov sector agrees to hold their liability. The gov goes into neg equity which is matched by the +ve equity of the non-gov. Everything financial sums to zero at all times.
The state sector can spend because someone in the non-gov sector agrees to hold their liability. The gov goes into neg equity which is matched by the +ve equity of the non-gov. Everything financial sums to zero at all times.
This again 😅 What do you mean "spend a liability"? And by "cannot" do you mean "choose not to by dint of laws and rules in the US saying that the TGA has to be positive"?
You know the US isn't the only nation and UK's "TGA" is always negative intraday when spending occurs?
You know the US isn't the only nation and UK's "TGA" is always negative intraday when spending occurs?
January 7, 2026 at 6:50 PM
This again 😅 What do you mean "spend a liability"? And by "cannot" do you mean "choose not to by dint of laws and rules in the US saying that the TGA has to be positive"?
You know the US isn't the only nation and UK's "TGA" is always negative intraday when spending occurs?
You know the US isn't the only nation and UK's "TGA" is always negative intraday when spending occurs?
Household saving is defined as disposable income less consumption (S = Y - T - C = Yd - C).
Aggregate net non-gov saving is defined as total saving less investment (S-I).
By accounting definition, net non-gov saving must be the same as the sum of gov deficits and net exports (S-I = G-T - M-X)
Aggregate net non-gov saving is defined as total saving less investment (S-I).
By accounting definition, net non-gov saving must be the same as the sum of gov deficits and net exports (S-I = G-T - M-X)
January 7, 2026 at 2:03 PM
Household saving is defined as disposable income less consumption (S = Y - T - C = Yd - C).
Aggregate net non-gov saving is defined as total saving less investment (S-I).
By accounting definition, net non-gov saving must be the same as the sum of gov deficits and net exports (S-I = G-T - M-X)
Aggregate net non-gov saving is defined as total saving less investment (S-I).
By accounting definition, net non-gov saving must be the same as the sum of gov deficits and net exports (S-I = G-T - M-X)
Difference between saving and net saving ;)
January 7, 2026 at 1:57 PM
Difference between saving and net saving ;)
... the US gov can spend $20tn tomorrow if it wanted to via Congressional and Presidential approval. The Fed would have no choice to facilitate the payments via getting around the arbitrary "+ve TGA rule" and new USD state IOUs would be issued (in the form of bonds).
December 22, 2025 at 6:24 PM
... the US gov can spend $20tn tomorrow if it wanted to via Congressional and Presidential approval. The Fed would have no choice to facilitate the payments via getting around the arbitrary "+ve TGA rule" and new USD state IOUs would be issued (in the form of bonds).
.. enough TGA balance then the Fed and Tsy will coordinate to ensure the Fed conducts temporary OMOs to create the reserves in the system for Banks to purchase gilts from the Tsy to top up the TGA so the Tsy can spend. But this is *not* what you think it means...
December 22, 2025 at 6:24 PM
.. enough TGA balance then the Fed and Tsy will coordinate to ensure the Fed conducts temporary OMOs to create the reserves in the system for Banks to purchase gilts from the Tsy to top up the TGA so the Tsy can spend. But this is *not* what you think it means...
Unless you can tell me who in the private sector issues sterling or dollar credits, you've got this confused. You think Mosler is is making a point that he is not. The Tsy-Fed consolidated gov system issues USD credits when it spends. No other way to create dollars. If the Tsy doesn't have a large..
December 22, 2025 at 6:24 PM
Unless you can tell me who in the private sector issues sterling or dollar credits, you've got this confused. You think Mosler is is making a point that he is not. The Tsy-Fed consolidated gov system issues USD credits when it spends. No other way to create dollars. If the Tsy doesn't have a large..
None of those acts mean the UK doesn't issue sterling. Private sector can't create and issue sterling. You've got it the wrong way round for some reason
December 22, 2025 at 5:33 PM
None of those acts mean the UK doesn't issue sterling. Private sector can't create and issue sterling. You've got it the wrong way round for some reason
It literally can't be counterfeiting for the nation state government to create and issue currency..
And I've told you how it works.The state sector (Tsy and BoE) coordinate to issue new state IOUs every time it spends.Taxes reverse this process by redeeming those IOUs.The excess is put in bond form
And I've told you how it works.The state sector (Tsy and BoE) coordinate to issue new state IOUs every time it spends.Taxes reverse this process by redeeming those IOUs.The excess is put in bond form
December 22, 2025 at 4:59 PM
It literally can't be counterfeiting for the nation state government to create and issue currency..
And I've told you how it works.The state sector (Tsy and BoE) coordinate to issue new state IOUs every time it spends.Taxes reverse this process by redeeming those IOUs.The excess is put in bond form
And I've told you how it works.The state sector (Tsy and BoE) coordinate to issue new state IOUs every time it spends.Taxes reverse this process by redeeming those IOUs.The excess is put in bond form
You're confused again. You must realise if a private actor issues currency, it's counterfeiting, right?
December 22, 2025 at 4:05 PM
You're confused again. You must realise if a private actor issues currency, it's counterfeiting, right?
You believe the private sector creates and issues the state currency into existence do you? Interesting
December 22, 2025 at 3:58 PM
You believe the private sector creates and issues the state currency into existence do you? Interesting
You're nearly there. So where to the currency credits used to pay taxes or buy bonds come from originally?
December 22, 2025 at 3:50 PM
You're nearly there. So where to the currency credits used to pay taxes or buy bonds come from originally?
You're again confused. We're not talking about bonds. Forget them for now. When I say the state spends by issuing an IOU, I'm referring to state currency. The USD or GBP, etc. This is how it works I promise you. It's a credit-based state monetary system driven by coercive tax liabilities.
December 22, 2025 at 3:27 PM
You're again confused. We're not talking about bonds. Forget them for now. When I say the state spends by issuing an IOU, I'm referring to state currency. The USD or GBP, etc. This is how it works I promise you. It's a credit-based state monetary system driven by coercive tax liabilities.
I've never claimed any of that? What are you talking about? Bonds are a longer duration state liability earning some fixed rate. They aren't currency but they are highly liquid money-like assets as people's savings, readily converted into currency for spending if people want to.
December 22, 2025 at 2:47 PM
I've never claimed any of that? What are you talking about? Bonds are a longer duration state liability earning some fixed rate. They aren't currency but they are highly liquid money-like assets as people's savings, readily converted into currency for spending if people want to.
The only promise the state makes to you holding its liabilities is to accept them back in redemption and payment of your own tax debts to them. That's it. It's all perfectly consistent with the accounting processes laid on top that you confuse for something they're not.
December 22, 2025 at 2:42 PM
The only promise the state makes to you holding its liabilities is to accept them back in redemption and payment of your own tax debts to them. That's it. It's all perfectly consistent with the accounting processes laid on top that you confuse for something they're not.
Of course it is. If you accept my IOU, my liabilities have increased and your assets have increased. Net across the system is always zero.
Obvs the IOU itself doesn't create the sugar! It's not claiming to. Likewise, currency never produced the gold either. But today, a state IOU is a tax credit.
Obvs the IOU itself doesn't create the sugar! It's not claiming to. Likewise, currency never produced the gold either. But today, a state IOU is a tax credit.
December 22, 2025 at 2:42 PM
Of course it is. If you accept my IOU, my liabilities have increased and your assets have increased. Net across the system is always zero.
Obvs the IOU itself doesn't create the sugar! It's not claiming to. Likewise, currency never produced the gold either. But today, a state IOU is a tax credit.
Obvs the IOU itself doesn't create the sugar! It's not claiming to. Likewise, currency never produced the gold either. But today, a state IOU is a tax credit.
What do you mean?The relevant question is where did I get the "IOU sugar" written in the paper from?The answer is that I created it when I wrote it and issued it to you.The moment you accept it in payment is the moment it becomes a monetary instrument and a financial asset claim on me in your hands.
December 22, 2025 at 2:16 PM
What do you mean?The relevant question is where did I get the "IOU sugar" written in the paper from?The answer is that I created it when I wrote it and issued it to you.The moment you accept it in payment is the moment it becomes a monetary instrument and a financial asset claim on me in your hands.