Author

Randall Wray 74 posts 0 comments

L. Randall Wray is a professor of economics and research director of the Center for Full Employment and Price Stability at the University of Missouri–Kansas City. His current research focuses on providing a critique of orthodox monetary policy, and the development of an alternative approach. He also publishes extensively in the areas of full employment policy and the monetary theory of production. Wray received a B.A. from the University of the Pacific and an M.A. and a Ph.D. from Washington University, where he was a student of Hyman Minsky.

Markets

Anecdotes of Mortgage Fraud

Randall Wray Mar 9, 2012

Appraisers are pursuing class action suits against banks, asserting they were blacklisted if they refused to engage in fraudulent appraisals. The problem is that if they win, they are then subject to suit by homeowners (who are losing their…

Political Economy

MMT for Austrians

Randall Wray Mar 1, 2012

We (also) do not want black helicopters flying around dropping bags of cash; and we (also) oppose government “pump-priming” demand stimulus—the libertarians and Austrians and even Milton Friedman are correct in their argument that this…

Economy

The Fetish for Liquidity (and Reform of the Financial System)

Randall Wray Jan 31, 2012

So here’s the deal. What happened is that the financial sector taken as a whole moved into extremely short-term finance of positions in assets. This is a huge topic and is related to the transformation of investment banking partnerships…

Monetary System

Functional Finance and Exchange Rate Regimes: The Twin Deficits Debate

Randall Wray Jan 30, 2012

In conclusion, while there are links between the “twin deficits”, they are not the links usually imagined. US trade and budget deficits are linked, but they do not put the US in an unsustainable position vis a vis the Chinese. If the…

Monetary System

Milton Friedman, Functional Finance and the Government Budget Constraint

Randall Wray Jan 23, 2012

Last week we examined Milton Friedman’s version of Functional Finance, which we found to be remarkably similar to Abba Lerner’s. The only problem with Friedman’s analysis is that he did not account for the external sector: he wanted a…

Monetary System

Milton Friedman’s 1948 Functional Finance Proposal

Randall Wray Jan 17, 2012

Milton Friedman's 1948 article, "A Monetary and Fiscal Framework for Economic Stability" put forward a proposal according to which the government would run a balanced budget only at full employment, with deficits in recession and surpluses…

Monetary System

Monetary and Fiscal Policy for Sovereign Currencies

Randall Wray Jan 9, 2012

This week we begin a new topic: functional finance. This will occupy us for the next several blog posts. Today we will lay out Abba Lerner’s approach to policy.

Monetary System

What is Modern Money Theory?

Randall Wray Jan 3, 2012

OK, you might be wondering: Isn’t this a strange point at which to raise the question, “what is modern money theory?” Yes, in some important ways, it is. However in the past week there have been some really pretty extraordinary pieces in…

Political Economy

Unemployment Insurance for the 21st Century: The Job Guarantee as an Alternative to Enforced…

Randall Wray Dec 27, 2011

A new universal direct job creation program would improve working conditions in the private sector as employees would have the option of moving into the JG program. Hence, private sector employers would have to offer a wage and benefit…

Monetary System

What about a country that adopts a foreign currency? Part Two

Randall Wray Dec 26, 2011

Yet another rescue plan for the EMU is making its way through central Europe—with the ECB acting as lender of last resort to Euro-banks. It is trying the tried-and-failed Fed method of rescue. As we now know the Fed lent and spent over $29…