“By fueling an overall increase in demand, central banks can generate a sustained increase in the general level of prices — inflation. Central banks are the primary source of money creation, not firms.” ~Nicolás Cachanosky
READ MORE” Fed watchers expect the Federal Open Market Committee will keep rates steady when they meet on March 19-20. In light of the CPI data, that’s a defensible move.” ~Alexander W. Salter
READ MORE“It’s not that Argentina lacks dollars. Rather, it is that the Argentine government lacks the will to commit to its dollarization plan.” ~Nicolás Cachanosky
READ MORE“Higher rates could be a sign of loose money, not tight, depending on how far from the policy change we’re looking and how fast the market adapts.” ~ Alexander W. Salter
READ MORE“So rather than starting to tighten policy in the fourth quarter of ‘21, as Powell described, the Fed was implicitly loosening policy through May of ‘22.” ~Thomas L. Hogan
READ MORE“The Fed should be looking ahead and adjusting monetary policy in light of its forecasts. Instead, its eyes are fixed on the rear-view mirror.” ~William J. Luther
READ MORE“At most, large deficits impelled the Fed to support the market for government debt by purchasing more debt than it should have. The central bank, not the fiscal authorities, is the residual determiner of aggregate demand.” ~Alexander W. Salter
READ MORE“Team Transitory’s narrative just doesn’t cohere. Whether we’re trying to explain the Great Inflation of the 1970s and early 1980s, or the inflation of the past two years, we need to rely on demand-side mechanisms.” ~Alexander W. Salter
READ MORE“Microeconomic relative-price dynamics increasingly drive inflation measurements. That means the Fed should not be afraid to ease off the brakes.” ~Alexander W. Salter
READ MORE“The delayed implementation of dollarization in Argentina presents challenges that could have been avoided had Milei honored his promise to abandon the peso straightaway.” ~Nicolás Cachanosky
READ MORE“The Fed’s self-conception as an apolitical technocracy blinds it to the degree to which it has weighed in on fundamental political issues, which instead ought to be deliberated in Congress.” ~Alexander W. Salter
READ MORE“While not a groundbreaking revelation for any central bank, the lack of concern about the economic and institutional implications of monetizing financial obligations is cause for concern.” ~Nicolas Cachanosky
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