Topic: Monetary Policy

Disinflation Dream Come True

– December 1, 2023

“The Fed will probably keep the fed funds target range unchanged in December. Officials previously signaled additional tightening, but things have changed.” ~Alexander W. Salter


Argentina Agonistes: The Separation of Money and State

– November 29, 2023

“The Argentine peso has lost 93 percent of its value in just the past 4 years. Anyone who could carry out transactions using dollars always did so; holding pesos was little different from simply setting your wealth on fire.” ~Michael Munger


Garbled Economics in the WSJ on Argentina Dollarization

– November 26, 2023

“Dollarization may not be the first-best solution for Argentina, though it’s hard to imagine it will be worse than hyperinflation.” ~Jason Sorens


Hyperinflation and Dollarization: A Path to Economic Stability for Argentina

– November 25, 2023

“The risk of hyperinflation in Argentina does not arise from the intention to dollarize but from a central bank that appears incapable or unwilling to exercise restraint. Argentina’s historical record shows that central bank independence is absent.” ~Nicolas Cachanosky


Timiraos on Supply-Side Disinflation

– November 24, 2023

“Slowing down total spending growth (current-dollar GDP) by hiking interest rates and shrinking the balance sheet clearly mattered. Supply-side improvements do too, but they’re likely playing the role of the sidekick rather than the hero.” ~Alexander W. Salter


Black Friday 2023 Will Test Consumer Confidence

– November 23, 2023

“Although Black Friday is a day of discounts, rebates, and other sales promotions, examining the price changes in the most-marketed merchandise categories may provide some insights as to what consumers face this year.” ~Peter C. Earle


AIER’s Thanksgiving Cost Index Climbs Over 5 Percent from 2022 to 2023

– November 22, 2023

“The constituents of the Thanksgiving Cost Index include turkey, sauces and gravies, bread, canned fruit, vegetables, and pies and cakes.” ~Peter C. Earle


Dollarization without Fiscal Prudence Is Not Possible. With Fiscal Prudence, It’s not Necessary. 

– November 22, 2023

“Argentinean problems are first political, then fiscal, and then monetary, and they need to be solved in the same order.” ~Leonidas Zelmanovitz


ESG as an Artifact of Zero Interest Rate Policy

– November 19, 2023

“The reasons attributed to billions of dollars leaving the ESG sector include concerns about greenwashing and political backlash. That the flight of funds coincides almost perfectly with the start of inflation and turned negative shortly after the Fed began its contractionary policy bias is either not noticed or considered.” ~Peter C. Earle


The Fed Delivered Disinflation

– November 16, 2023

“Most prices are higher today than they would have been had they grown at an average rate of 2 percent since January 2020. We oughtn’t pin a medal on an arsonist’s chest for putting out a fire he started.” ~Alexander W. Salter


Dollarization Is A Cost-Effective Solution for Argentina

– November 11, 2023

“If Argentina lacks the resources for dollarization, it most certainly does not possess the means to rescue the peso. The alternative is to continue on the current course, and approach dollarization under circumstances akin to Zimbabwe.” ~Nicolas Cachanosky


WeInflate, WeMalinvest, WeWork 

– November 9, 2023

“Companies founded in easy money periods will tend to be the most vulnerable. Many firms will survive the credit crunch, but few will emerge unscathed.” ~Peter C. Earle