Much poor reasoning stems from failing to acknowledge this fundamental distinction. To tie this back in with what @dsquareddigest.bsky.social says above, 7/
For those interested, a quick overview of what @anttij.bsky.social and I have coined (pardon the pun) the *Accounting View*. Wrt government finances it states that the acts of *governing*, in the sense of providing a public good, 1/
One of the effects being that all entries on banks' books net to zero - per definition. So one cannot just ignore equity, which is effectively a credit account, without breaking accounting as a whole. It's non-sensical. 6/
My car radio dumped me. 🤷
What's up? Snow's up!
no matter what one's beef with cb equity may be (perhaps a belief that government's power to command goods from its tax payers is boundless?), leave accounting out of it. It's been around for thousands of years and has withstood all such assaults. 8/8
very logic it is built on (credits = debits) for accounts pertaining to the government. To grasp the difference, it makes sense to think of *agents* (i.e. people or groups of people such as governments) that trade among each other 3/
is as necessary for conceptualizing prices and hence agents' balances in the first place as it is simple in its basic administration. Namely crediting and debiting agents' accounts by equal amounts when trades are made. 5/
and institutions that keep track of trades among those agents (banks). Agents can run positive or negative balances indefinitely. For them, credits must not equal debits. The act of keeping track of trades between agents (banking / accounting) otoh, 4/
must be kept apart conceptually and hence institutionally from the art of *banking* (accounting). While central banking is itself a government service, it is a category error to claim that a nation's top accountant (the cb) can suspend the 2/