federal reserve

The Fed Can Generate Higher Inflation

– September 24, 2020

“A lack of concern for fiscal discipline by both the U.S. Treasury Secretary and a call for persistent, near zero rates by the Chairman of the Federal Reserve suggests that the Federal Reserve and the U.S. Treasury will act in concert to make the new inflation target a reality. It is not a question of whether the inflation rate will pass 2 percent, but when.” ~ James L. Caton

same thinking

Meet the New Fed, Same as the Old Fed: Jerome Powell’s Inflation Revelation Falls Flat

– September 9, 2020

“If it’s serious about a 2% inflation target, the Fed will have to do better than a pep rally. We were promised meaningful change; what we got was the same old song and dance.” ~ Phillip W. Magness & Alexander W. Salter


The Fed’s Policy Shift to Let Inflation Rip Higher Is Deeply Flawed

– September 8, 2020

“It’s hard to see the Fed achieving higher inflation, given its recent failure in this matter. A quick look at the monthly consumer price index data over the last decade shows that for the vast majority of the period, inflation was well below 2%. Or put another way, despite all the money printing by the Fed and extended periods of low interest rates, the Fed hasn’t hit its targets in any sustainable way.” ~ Simon Constable

inflation targeting

Average Inflation Targeting and Expectations

– September 6, 2020

“If credible and clearly articulated, an average inflation targeting regime would provide a better anchor for inflation expectations than a period-by-period inflation targeting regime. Alas, the Fed’s new policy strategy has not been clearly articulated, leaving short-run inflation expectations unanchored.” ~ William J. Luther


Raising Inflation Expectations by Targeting the Average Rate of Inflation

– September 3, 2020

“The Federal Reserve has increased its commitment to offset a fall in the total level of expenditures in response to an economic downturn. Absent a systematic disruption in the structure of international monetary arrangements or another factor that cannot be offset by monetary policy, the FOMC will ensure that downturns are met with accommodation from monetary policy.” ~ James L. Caton


The Fed Needs a Shed

– August 28, 2020

“The crisis period is now behind us. The need for these facilities, if ever there was one, is now past. It’s time to put away the emergency lending tools.” ~ Thomas L. Hogan


Governments Are Faking It, and Copying Each Other

– August 20, 2020

“A mystery for months is how it is that so many governments in so many different places on earth could have adopted the same or very similar preposterous policies, no matter the threat level of the virus, and without firm evidence that interventions had any hope of being effective.” ~ Jeffrey Tucker

stormy fed

Can the Fed Reduce Inequality?

– August 18, 2020

“If the Fed aims to reduce inequality, it should use policies that are known to be effective. There is little scope for affecting inequality with monetary policy. Reducing banks’ regulatory burden reduces inequality by improving the lives of Americans with the lowest incomes.” ~ Thomas L. Hogan


ECB: On the Credit Wave towards Zombification

– August 17, 2020

“As in the planned economies, negative productivity gains and painful prosperity losses will be unavoidable. Because productivity gains are the basis for real wage increases, the benign long-term credit conditions of the ECB increasingly become a burden for the young people in Europe.” ~ Gunther Schnabl & Nils Sonnerberg


More Stimulus Checks: An Expensive Political Stunt

– August 15, 2020

“Adding $400 a week to unemployment benefits would clearly be more than enough. When it comes to Economic Impact Payments the economically optimal amount is zero.” ~ Alan Reynolds

money printer

What Did the “Stimulus Plan” Stimulate?

– August 10, 2020

“The only conceivable rationale for repeating the latest of many failed experiments with fiscal stimulus (borrowing from Peter to pay Paul) might be to ‘stimulate demand.’ But we just tried that. It didn’t work. It never works.” ~ Alan Reynolds

steve mnuchin

Government Can’t Police Itself

– August 8, 2020

“I will always support more transparency and more oversight, if only because doing so is part of my job and makes that job easier– one of which I’m proud. But intoning ‘more transparency’ is no silver bullet for shrinking the size of government and for getting rid of bad programs. The only ‘substantive’ result of such proclamations is that they provide Congress a rationale for holding ever-more pointless hearings.” ~ Veronique de Rugy