The Sound Money Project was founded in January 2009 to conduct research and promote awareness about monetary stability and financial privacy. The project is comprised of leading academics and practitioners in money, banking, and macroeconomics. It offers regular commentary and in-depth analysis on monetary policy, alternative monetary systems, financial markets regulation, cryptocurrencies, and the history of monetary and macroeconomic thought. For the latest on sound money issues, subscribe to our working paper series and follow along on Twitter or Facebook.
Advisory Board: Steve H. Hanke, Jerry L. Jordan, Lawrence H. White
Director: William J. Luther
Senior Fellows: Nicolás Cachanosky, Gerald P. Dwyer, Joshua R. Hendrickson, Thomas L. Hogan, Gerald P. O’Driscoll, Jr., Alexander W. Salter
Fellows: James L. Caton, J.P. Koning
The SEC, Cryptocurrencies and Securities
“What are the implications of the Ripple suit for cryptocurrencies in general? Cryptocurrencies with a framework similar to Ripple’s obviously have a problem. Decentralized cryptocurrencies such as Bitcoin and Ether are far away from the situation creating problems for Ripple.” ~ Gerald P. Dwyer
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Sovereign Debt After Covid-19: The Wrong View
“Like many others, I am concerned about the sovereign debt market in the wake of Covid-19. But providing more funds to governments committed to maintaining an unsustainable course is not a solution. These countries need serious institutional reforms.” ~ Nicolás Cachanosky
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Here’s Why We Tolerate Fake Check Scams
“Solving the problem of job scam checks isn’t as easy as one might think. Changes to a tightly-wound system like the check system involve tradeoffs. You don’t get something for nothing.” ~ J.P. Koning
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Adopting a Gold Standard Would Promote Fiscal Discipline
“We could allow for a de facto gold standard at little cost. And this standard would ensure that investors could discipline government for borrowing excessively. If citizens were allowed to save their income in gold-denominated accounts without extra costs of taxation and financial regulation, disciplining their government would be as easy as changing the form of one’s savings account.” ~ James L. Caton
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Knowledge Problems With Discretionary Central Banking
“You need to make some truly heroic assumptions in order for discretionary monetary policy to outperform rule-bound policy. Rarely do any of those assumptions hold. Never do they all hold. If we want a well-functioning central bank, the best we can do is to have rules.” ~ Alexander W. Salter
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Pornhub: Victim of Visa and Mastercard Censorship or Money Laundering Risk?
“Pornhub’s deplatforming is so controversial, in part, because it appears to be arbitrary. It was the New York Times that ultimately served as the fuse, not Visa or Mastercard internal checks.” ~ J.P. Koning
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Making Money Lawful
“In terms of incentives, politicians can’t meddle, and central bankers can’t distribute unnecessary largesse, if monetary policy is constrained by a rule. Given that the Fed exists, and isn’t going anywhere soon, the best course of action is to ditch the ‘discretion’ part of ‘constrained discretion.'” ~ Alexander W. Salter
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A Simpler and More Accurate Way to Teach Money to Students
“Money isn’t best thought of as a medium of exchange, unit of account, and store of value. Let’s just think of it as just a medium of exchange and a unit of account. For the most part these circles overlap, and the two functions are united. But this isn’t always the case.” ~ J.P. Koning
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FedCoin Revisited
“We don’t know whether the Fed would take steps to eliminate cash or impose negative rates on FedCoin balances. We don’t know how it would go about intermediating funds. But such speculations should make one thing clear: there are risks. At the least, we should develop strong institutional checks before permitting the Fed to plow ahead.” ~ Nicolás Cachanosky
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The Complexity of Monetary Policy and the Effectiveness of the Fed’s Commitment to a Higher Rate of Inflation
“A better policy would be to bring greater clarity to the structure and effects of the Fed’s policy framework so as to improve the quality of investor expectations. So long as investors feel that they might as well be reading tea leaves to predict Fed policy, the Fed will struggle to anchor investor expectations of nominal and real income growth.” ~ James L. Caton
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Filling Fed Vacancies Would Leave Biden with Few Options to Replace Powell
“Biden’s only other play would be to lean on historical norms. Fed Chairs rarely stick around to serve out their terms as mere Governors when they are not reappointed to the top spot. Janet Yellen resigned in 2018, when Trump replaced her as Chair with Powell, despite having nearly six years left on her term as Governor. Biden might hope Powell will follow suit.” ~ William J. Luther
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Not All Government Spending is Stimulus
“Relief spending would be a much-needed blessing for many Americans. But paying people not to work does not stimulate the economy.” ~ Thomas L. Hogan
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