CBDCs: What Can We Learn From Dollarized Countries?
“How much more could FDR have done had he had a CBDC? The risk of a CBDC goes beyond the serious issue of financial privacy.” ~ Nicolás Cachanosky
READ MORE
Helping Banks Help Themselves: Extended Shareholder Liability
“The best way to reduce systemic risk is to give the risktakers the incentive to economize on risk. An extended liability regime for banking is a simple and elegant way to improve incentives. We should seriously consider it.” ~ Alexander William Salter
READ MORE
Inflated Hopes and Burst Bubbles
“The Fed’s chief task is to restore its lost credibility. In retrospect, the switch to average inflation targeting was a mistake. It gave the Fed plausible deniability for noisier, less predictable policy.” ~ Alexander William Salter
READ MORE
A Very British Fiasco
“These things happen, but they happen a lot to UK financial regulators, and Governor Bailey himself has presided over a good number of regulatory fiascos. In short, the crisis confirms that UK financial regulation is not fit for purpose.” ~ Kevin Dowd
READ MORE
The CBDC Tradeoff
“Rather than crowding out the private sector with a CBDC, the government should let a thousand payment mechanisms bloom.” ~ William J. Luther
READ MORE
Will A Digital Dollar Offer Financial Privacy?
“At some point, a CBDC that fails to provide a high degree of financial privacy will be used to monitor and censor the transactions of one’s political enemies. It is foolish to think otherwise.” ~ William J. Luther
READ MORE
A Central Bank Reckoning
“Even the best set of rules and the tightest, most targeted, narrowly circumscribed mandate won’t be enough unless central bankers are willing to emulate something akin to judicial restraint.” ~ Samuel Gregg
READ MORE
Against Interest Rate Reductionism
“Monetary policy is about money, not interest rates. Central bankers should stop trying to implement monetary policy by messing with relative prices. There are better measures and more effective transmission mechanisms.” ~ Alexander William Salter
READ MORE
The Unquestioned Monopoly
“Despite the arguments made against monopoly and the arguments made in favor of competition, there is one monopoly that largely goes unquestioned. I’m referring, of course, to the monopoly over currency issuance.” ~ Joshua R. Hendrickson
READ MORE
Interest Rates and Fed Tightening
“While interest rates can sometimes be useful as a policy barometer, the various monetary measures (from the monetary base at narrowest to total nominal expenditures at broadest) matter far more.” ~ Alexander William Salter
READ MORE
Fed Up With the Fed
“The Hamilton-Bagehot rule was superior to the modern Fed practice of flooding the markets with cheap money because it allowed insolvent firms to go bankrupt while supplying emergency loans to troubled but solvent companies.” ~ Robert E. Wright
READ MORE
Financial Stability and the Fed
“The Fed failed at its initial task of promoting financial stability. It has failed at conducting monetary policy as well. Given the Fed’s major financial-policy and monetary-policy errors since 2008, we should explore major structural changes.” ~ Alexander William Salter
READ MORE
