Money Archives

How Neflix’s Expense (Non)Policy Works

How can a company as big as Netflix have such a lenient expense policy? How can Netflix enforce such subjective rules? Netflix’s expense policy basically states that all employees must “act in the company’s best interest” when it comes to travel expenses such as flights, hotels, and dinners. The problem is that each person may have a different idea of what is acceptable and what is extravagant. Here’s how Netflix ironed out the kinks in their expense policy.

The Failure of Structural Adjustment Loans

What are structural adjustment loans? Why does economist William Easterly think they are a huge failure? Structural adjustment loans are economic reforms that aim to transition a country to a free-market economy—but they come with many catches. In the end, these loans usually end up putting a struggling country into more debt. Keep reading to learn why structural adjustment loans are not the answer to economic reform.

Is Social Security Running Out of Money? No!

Is Social Security running out of money? Why does modern monetary theory say the entitlement program crisis is a lie? Modern monetary theory (MMT) says that social entitlement programs such as Social Security and Medicaid will always be safe. This theory goes against the common belief that, due to the number of Baby Boomers, the social entitlement programs will run out of money and future generations will need to find alternative forms of aid. Keep reading for economist and MMT believer Stephanie Kelton’s take on the entitlement crisis.

Problems With the Federal Reserve (According to MMT)

How does the federal reserve set monetary policy? Why does economist Stephanie Kelton believe that the Fed is causing needless suffering in the United States? In her book The Deficit Myth, Kelton (a believer in modern monetary theory) thinks that the federal reserve is too conservative and overreacts when it comes to the fear of inflation. Kelton and other MMT proponents believe in using a combination of deficit spending and low interest rates to boost demand and create full employment instead. Below, we will discuss the problems with the Federal Reserve, according to Stephanie Kelton.

Contrasting Religious Views on Poverty

What are the various religious views on poverty? How do they perceive wealth? In the Christian classic The Cost of Discipleship, Dietrich Bonhoeffer argues that Christians should build wealth in heaven, not on earth. He asserts that earthly belongings contribute to worry, as we have more to lose. However, some religions—even other Christian traditions—disagree with him. Continue reading to learn about various religious views on poverty.

Is a Trade Deficit Good or Bad? An Economist Answers

Is a trade deficit a good or bad thing? Could there possibly be benefits to having a trade deficit? According to Stephanie Kelton, an economist and believer in modern monetary theory, the United States trade deficit is actually a strength rather than a weakness. She believes that the trade deficit puts the United States in a position of power because other countries rely on its currency. Here’s a more in-depth look at the U.S. trade deficit from The Deficit Myth.

Monetary Sovereignty Means No National Debt

What is a monetary sovereign? Why does Stephanie Kelton, the author of The Deficit Myth, believe monetary sovereigns can print unlimited amounts of money? A monetary sovereign is a country that is the sole issuer of its own currency, and its currency isn’t tied to a finite object or another country’s currency. Believers of modern monetary theory such as Kelton argue this means they can never be in debt because they can always print more money. Continue reading to learn more about monetary sovereignty and for criticism of their arguments.

Modern Monetary Theory (MMT)— Explained

Are you looking for an explanation of modern monetary theory? What criteria must a nation satisfy to be considered a monetary sovereign? The short version of modern monetary theory is that there are some nations (like the United States) that are unconstrained in their power to spend money because their currencies satisfy certain criteria. MMT is controversial and is criticized by economists. Continue below if you want to learn more about modern monetary theory, explained with analysis.

The 3 Categories of Shopping Choices—Explained

What are the three different types of consumer choices? Why can having more shopping choices make you stressed out? According to Barry Schwartz, the author of The Paradox of Choice, there are three types of shopping choices you likely encounter in your life: groceries, electronics, and entertainment. With so many products out there to choose from, Schwartz explains each type of choice and why you should or shouldn’t spend time on them. Learn more about the three types of shopping choices below.

How Greed Fueled the 2008 Subprime Mortgage Crisis

Suburban Flight and The Role of The Government

What caused the United States subprime mortgage crisis in 2008? How did the mortgage meltdown spill out into a global financial crisis? The United States subprime mortgage crisis was years in the making. However, few could anticipate one of the biggest financial crises in history—in spite of the warning signs. At its heart, was a relatively new class of asset: the mortgage-backed security. In this article, we’ll discuss how mortgage-backed securities caused the biggest financial crisis in the eight preceding decades.