On the Monetary and Financial Stability under A Public Money System : Modeling the American Monetary Act Simplified

摘要

Our economies are currently facing systemic failures of financial and debt crises. To overcome these, an alternative public money system is proposed by the American Monetary Act. This paper is the third one that examines the feasibility of the public money system. First and second papers have focused on the liquidation of government debt. This paper explores monetary and financial stability under the public money system in comparison with the current debt money system, by constructing a simplified macroeconomic model. It demonstrates through simulation that monetary and financial instability is built into the current debt money system and "booms and depressions" become inescapable. On the other hand, monetary and financial stability is shown to be accomplished under the public money system.