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> Reading Debt is no substitute for serious study of economics The thing about studying economics is that unless you do it to considerable depth, you'll come a
by soVeryTired 9y ago
> Reading Debt is no substitute for serious study of economics
The thing about studying economics is that unless you do it to considerable depth, you'll come away with the wrong conclusions.
Undergraduate economics textbooks teach that central banks try to control the supply of money as an explicit target, and that commercial banks lend out their reserves - both of which are objectively false.
Debt has its flaws, but it at least gets the basic mechanics correct.
- danharaj 9y agoWhich textbooks get the basics right? Can be technical and/or aimed at a non-beginner level.
- soVeryTired 9y agoI'm don't know of a good textbook that explains it well. But for an example of a textbook that gets it wrong, see Mankiw's introductory macro book. Mankiw alludes to the important brake on credit creation (capital constraints), but dismisses them as 'arcane', then goes on to describe a fractional reserve system that doesn't really exist anymore. I've pieced together what I can from reading blogs (Frances Coppola [0] is very informative in this regard). The Bank of England wrote a document explaining their view of the process of money creation [1], which is widely accepted as correct. Edit: actually, this might do: http://neweconomicperspectives.org/money-banking http://neweconomicperspectives.org/money-banking [0] http://www.coppolacomment.com/ http://www.coppolacomment.com/ [1] http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2014/qb14q102.pdf http://www.bankofengland.co.uk/publications/Documents/quarte...