Inflation is High, Will Remain Elevated for Years

– January 31, 2022

“At this stage, two things seem pretty clear: Inflation is high and will likely remain above target for a few years. My own view is that the FOMC is painting a rather rosy picture, and that market expectations provide a better guide for estimating inflation.” ~ William J. Luther


The Money Illusion: A Review

– January 21, 2022

“‘Nothing is as it seems in the world of money,’ Sumner concludes, and worse so as of late. In his grand attempt at rectifying the many blunders in understanding the Great Recession, there’s something for everyone to learn.” ~ Joakim Book


Forecasting Prices from FOMC Projections

– January 8, 2022

“While the period of time over which the Fed is committed to averaging inflation is not explicit, one might have reasonably expected it to ultimately offset the high inflation associated with the pandemic. Alas, that no longer appears to be the case.” ~ William J. Luther


Three Principles for Monetary Institutions: Review of Money and the Rule of Law

– January 7, 2022

“Money and the Rule of Law questions a lot of things we usually take for granted in the discussion of monetary policy, and makes the case for generality, predictability, and robustness created by strict monetary rules.” ~ Art Carden


The Fed’s Higher Fed Funds Rate Projections Mean What?

– December 29, 2021

“It is rarely prudent to assume that a central bank’s central planners can predict the future better than you can, or that they really know what they are doing and why.” ~ Alan Reynolds


Paul Volcker, the Fed, and ‘Tight Credit.’ The Myth That Won’t Die.

– December 27, 2021

“It’s no surprise that economic types want to believe all good things run through central planners, but readers of political and economic commentary would be wise to be skeptical. The Fed’s power is well overstated.” ~ John Tamny


Will the Fed Do Enough to Bring Down Inflation?

– December 11, 2021

“The Fed must act boldly and swiftly to course correct. Otherwise, inflation expectations could become unanchored––leaving the Fed to choose between restoring its credibility by engineering a recession or tolerating high inflation in perpetuity.” ~ William J. Luther


Powell Pivots as Inflation Picks Up

– December 3, 2021

“Powell recommended ditching the term transitory. ‘We tend to use it to mean that it won’t leave a permanent mark in the form of higher inflation,’ he told the Senate Committee. ‘I think it’s probably a good time to retire that word and try to explain more clearly what we mean.’” ~ William J. Luther


Despite Fed Asset Purchases, Lending Remains Depressed

– December 2, 2021

“The Fed’s recent asset purchases appear to have significantly expanded the money supply. But given the small changes in bank lending, it is not clear what their overall effects will be on inflation and the economy.” ~ Thomas L. Hogan


Negative Interest Rates and the ECB’s Brave New Credit World

– November 9, 2021

“The widely negative real interest rates, which have already been a reality in some segments of the European capital markets, might foreshadow this loss of welfare for the European people.” ~ Gunther Schnabl & Nils Sonnenberg


Is Larry Summers Channeling Benjamin Anderson?

– October 13, 2021

“The post-2008 framework has incentivized the destabilization of monetary policy. The sooner we recognize this fact, the sooner we can seriously discuss a solution to the problem.” ~ James L. Caton


The IMF Should Be Eliminated, Not Expanded

– October 12, 2021

“There are many good economists who work for the IMF and they often produce high-quality research. Sadly, their sensible analysis doesn’t seem to have any impact on the decisions of the organization’s top bureaucrats.” ~ Daniel J. Mitchell