Mengoreksi Penjelasan Sesat Mardigu tentang MMT, China dan Ekonomi.
Ferry Irwandi・2 minutes read
Indonesia faced economic crisis in 1965 due to reckless money control policies, with suggestions to implement MMT like China to address issues by controlling money production and using two currencies. MMT advocates for government control in money production to finance needs and employment opportunities, aiming to reduce dependence on debt by challenging the focus on interest and deficits.
Insights
- Modern Monetary Theory (MMT), advocated by figures like Michael Hudson, proposes government control in money production to fund a country's requirements and job creation, challenging the current economic system's emphasis on interest and deficits.
- China's economic success was not solely due to printing money with two currencies, but rather a result of comprehensive reforms starting in 1978, including privatization and opening up to foreign investors, showcasing the multifaceted approach and commitment necessary for economic advancement.
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Recent questions
What economic theory advocates for government control in money production?
Modern Monetary Theory (MMT)
How did China achieve economic success starting in 1978?
Comprehensive reforms including privatization and opening up to foreign investors
What are the potential risks of high inflation if not controlled?
Rapid price increases impacting resources and money management
How did Indonesia's economic crisis in 1965 affect foreign exchange reserves?
Almost reached 0% during the crisis
Can all countries effectively implement Modern Monetary Theory (MMT)?
Not all countries can due to currency value strength
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Summary
00:00
Indonesia's Economic Crisis and Modern Monetary Theory
- In 1965, Indonesia faced an economic crisis with hyperinflation reaching 650% due to reckless money control policies and development based on printing money.
- Foreign exchange reserves in Indonesia almost reached 0% during the crisis.
- Comments suggested that implementing Modern Monetary Theory (MMT) like China could solve Indonesia's issues by printing money and using two currencies for international transactions.
- MMT theory, popularized by figures like Michael Hudson, advocates for government control in money production to finance a country's needs and employment opportunities.
- MMT aims to reduce a country's dependence on debt by challenging the current economic system's focus on interest and deficits.
- Not all countries can effectively implement MMT, as seen in Venezuela and Greece, due to currency value strength.
- China's economic success was not solely due to printing money with two currencies but involved comprehensive reforms starting in 1978, including privatization and opening up to foreign investors.
- China's economic policy led to rapid development, reduced poverty, but widened income gaps, showcasing the complexity and dedication required for economic progress.
- The notion of China using two currencies is incorrect; China uses the renminbi and yuan, with strict monetary policies and a successful economic reform history.
- President Bang Akbar's hypothetical scenario of printing money to build housing units highlights the practical application of MMT principles in addressing infrastructure needs.
17:14
Rapid Inflation Risks and Contributing Factors
- Inflation can occur rapidly when a group of goods experience simultaneous price increases, impacting how money is managed and resources are utilized, potentially leading to high inflation risks if not carefully controlled. Factors contributing to inflation include the supply of sediment and the equilibrium point of supply and demand, not solely the circulation of currencies.
