Pertinent Category: Sound Money Project

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

Central Banking, Economic Education, Monetary Policy

Interest Rates, the Money Supply, and Say’s Law

Alexander William Salter

– April 13, 2023

“Say’s Law absolutely helps us understand booms and busts on the demand side, but because of its emphasis on money, not interest rates.” ~ Alexander William Salter

Central Banking, Inflation, Monetary Policy

Have We Crested the Inflation Wave?

Alexander William Salter

– April 7, 2023

“My view is the Fed should pause its rate hikes in the short-run. Disintermediation might be the cause of recent money-supply trends. In the long-run, the Fed should resume forward guidance, but not on interest rates.” ~ Alexander William Salter

Crisis, Monetary Policy, Regulation

Silicon Valley Bank: Mismanagement Is Not an Excuse for Inefficient Regulation

Nicolás Cachanosky

– April 3, 2023

“The mismanagement was endogenous to the regulatory regime. Rather than promoting financial stability, regulators have undermined it. Doubling down on a failed strategy will not make things better.” ~ Nicolás Cachanosky

Crisis, Economic Education, Government

Don’t Expand Deposit Insurance. Abolish It!

Bryan Cutsinger

– April 1, 2023

“Deposit insurance creates perverse incentives that weaken market discipline and encourage excessive risk-taking. Expanding deposit insurance will only make these problems worse.” ~ Bryan P. Cutsinger

Government, Inflation, Monetary Policy

Inflation Slowed in February, But Remained High

William J. Luther

– April 1, 2023

“Recent experience should prompt calls for the Fed to adopt a symmetric average inflation target when it reevaluates its mandate in 2024 and 2025.” ~ William J. Luther

Economic History, Monetary Policy, Regulation

Politics, Not Markets, Makes Banking Unstable

Alexander William Salter

– March 29, 2023

“Banking reform should rank high on our list of policy priorities, but moving away from fractional reserves shouldn’t be a part of the conversation.” ~ Alexander William Salter

Economic Education, Economic Theory, Monetary Policy

Lessons from the Phillips Curve

Joshua R. Hendrickson

– March 29, 2023

“The exploration of the Phillips Curve has taken many different paths and yet somehow ended up in the same place. The world could have been spared much of this meandering with a more firm grounding in what theory does and does not tell us.” ~ Joshua R. Hendrickson

Economic History, Fiscal Policy, Inflation, Monetary Policy

Monetary Policy and that Old-Time Fiscal Religion

Bryan Cutsinger

Louis Rouanet

– March 26, 2023

“Nominal income targeting can potentially restore the old-time fiscal religion. Like the classical gold standard, this approach stabilizes total spending in the economy, rendering counter-cyclical fiscal policy unnecessary and ineffective.” ~ Bryan P. Cutsinger & Louis Rouanet

Government, Inflation, Monetary Policy

Money and Inflation Are Still Related

Gerald P. Dwyer

John Devereux

– March 26, 2023

“M2 in 2020 and 2021 increased by the largest percentages in the last 60 years. To the surprise of the Federal Reserve (although not everyone), inflation resulted.” ~ John Devereux & Gerald P. Dwyer

Crisis, Financial Markets, Inflation, Monetary Policy

Fed Raises Rate, But Signals Potential Pause in May

William J. Luther

– March 23, 2023

“In 2021 they were looking for help from recovering supply chains. Now, they are looking for help from tight financial markets. It’s time FOMC members help themselves — or, God help us all.” ~ William J. Luther

Government, Inflation, Monetary Policy

Moral hazard is a fact of life. The Fed should focus on inflation.

Alexander William Salter

– March 23, 2023

“To the shame of two generations of economists-turned-policy-advisors, moral hazard is a fact of life. We don’t need to add permanent dollar depreciation to this mess.” ~ Alexander William Salter

Fiscal Policy, Government, Taxation

What To Do About Deficits, Debt

Alexander William Salter

– March 15, 2023

“When it comes to fiscal follies, this time is different. Let’s not pass the buck. Instead, let’s make the necessary sacrifices to ensure the long-run integrity of the United States. Let’s plant the trees.” ~ Alexander William Salter