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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: J.P. Koning
“Major changes in oil prices seem likely to drive the near-term changes in CPI inflation, both headline inflation and possibly core as well. Another big question is how the Fed will respond.” ~Thomas L. Hogan
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“Circumstances beyond our control will likely compel us to revert to something like the ‘old-time fiscal religion’ of balanced budgets during ordinary times, reserving deficits for extraordinary times.” ~Alexander W. Salter
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“Although Fed officials were late to tighten monetary policy, their efforts over the last year appear to have worked. The risk today is that monetary policy is too tight—and will remain so for too long.” ~William J. Luther
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“Specialization and productivity increase when the market’s size extends across national borders. But tariffs reduce the extent of the market and thereby reduce specialization.” ~Paul Mueller
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“Interest rate and liquidity data point to the same conclusion: monetary policy is sufficiently tight. Further tightening could cause a painful economic contraction.” ~Alexander W. Salter
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“If core inflation is more or less on track, why are most FOMC members projecting another rate hike?” ~William J. Luther
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“To put it plainly, monetary policy is already tight enough. The Fed’s job now is to stay the course.” ~ Alexander W. Salter
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“Despite some improvements since the apparent peak 13 months ago, consumers and businesses are still contending with 31 months of above-trend rising prices.” ~ Peter C. Earle
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“In addition to increasing workers’ real tax burden, raising the inflation target reduces workers’ real wages by reducing the demand for their labor services.” ~ Bryan Cutsinger
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“There’s no returning to the pre-pandemic trend for the price level. We’re left with permanently higher prices. Hopefully, the Fed continues to bring inflation down gradually.” ~ Alexander W. Salter
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“During normal times, when inflation is low and stable, the floor system increases the burden on taxpayers. The burden is even larger when inflation is high, as it has been over the past two years.” ~ Louis Rouanet
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“Interest rates on mortgages were 2.66 percent just two and a half years ago. Why the sudden increase in rates? The Federal Reserve increased the money supply and generated the worst inflation in many years.” ~ Gerald P. Dwyer
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