ABOUT MMT AND GOLD
According to MMT (Modern Monetary Theory), there are “four essential requirements that qualify a national currency as sovereign”.
Those four requirements include:
- the National government chooses a money of account in which the currency is denominated;
- the National government imposes obligations (taxes, fees, fines, tribute, tithes) denominated in the chosen money of account;
- the National government issues a currency denominated in the money of account, and accepts that currency in payment of the imposed obligations; and
- if the National government issues other obligations against itself, these are also denominated in the chosen money of account, and payable in the national government’s own currency.
We listed the above requirements and talked about ‘sovereign currencies’ in the article MMT – Variation On A Theme.
But, there is a fifth (important) requirement regarding MMT and a National government which issues a sovereign currency. That requirement is stated quite clearly by L. Randall Wray, who is one of the leading spokespersons in behalf of MMT: