Comparative Discussion of Modern Money Theory and New Currency Theory

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* Essay: Modern Money Theory and New Currency Theory A comparative discussion, including an assessment of their relevance to monetary reform. Joseph Huber

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This paper discusses Modern Money Theory (MMT) from the perspective of a New Currency Theory (NCT) as represented by proponents of monetary reform. In the paradigmatic framework of currency teachings versus banking teachings, MMT, in contrast to its self-image as a chartal theory of money, represents banking theory much more than currency teaching. Its understanding of fractional reserve banking and monetary sovereignty is misleadingly incomplete. Thus, NCT’s analyses appear to be a more adequate foundation for modern sovereign money.