Topic: Sound Money Project

Wars and the pre-Fed economy

– April 8, 2015

Many economists assume that the Fed has improved U.S. economic performance relative to the pre-Fed periods. As I discussed in a previous blog post, however, the Fed has been better on some margins and worse on others. Most improvements under the Fed ha …

Sound Money Project

The great stagnation

– April 6, 2015

Ben Bernanke, now at Brookings Institute, has a new blog where he has been discussing low interest rates and the problem of secular stagnation. Great stagnation occurs when there are plenty of savings, but not investment options. Therefore, savings are …

Sound Money Project

The monetary approach reigns supreme

– April 3, 2015

This article appeared in the April 2015 issue of Globe Asia. We are still in the grip of the Great Recession. Economic growth remains anemic and below its trend rate in most parts of the world. And what’s more, this state of subdued economic activity …

Sound Money Project

Hidden costs of Federal Deposit Insurance

– April 1, 2015

Before concluding that government-provided deposit insurances is a good deal, one should consider all of the costs and benefits relative to the relevant alternatives.

Sound Money Project

Managed money ≠ sound money

– March 30, 2015

When asked (especially during Congressional oversight hearings) a central banker will resolutely declare a belief in “price stability.” Then, with a straight face, express concerns that the rate of increase of consumer prices is below target! The belie …

Sound Money Project

Op-ed: Losing patience with the Fed

– March 19, 2015

It comes perhaps as no surprise that yesterday’s meeting of the ten voting members of the Federal Open Market Committee (FOMC) ended in an anti-climactic manner, providing no real clarity about the future of interest rates at the Federal Reserve. The r …

Sound Money Project

Deposit insurance and monetary stability

– March 18, 2015

Government deposit insurance from the Federal Deposit Insurance Corporation (FDIC) is intended to stabilize the financial system by preventing bank runs and financial contagion.

Sound Money Project

On regulating bitcoin

– March 17, 2015

There’s a lot of discussion about regulating cryptocurrencies like bitcoin these days.

Sound Money Project

The multiple moral hazards of central banking

– March 12, 2015

In an introductory economics course, students are taught that there is “moral hazard” in the incentives of commercial banks because of access to the “safety net” offered by central banks and the government’s guarantee/insurance of bank deposits. There …

Sound Money Project

What is sound money? A macroeconomic perspective

– March 9, 2015

The term “sound money” means different things to different people. Some stress the stability of purchasing power over time. Some stress the money’s ability to facilitate exchange. Some stress the money’s ability to promote macroeconomic stability. And, …

Sound Money Project

Sound Money meets the Fed

– March 6, 2015

In October of last year, while speaking at the Boston Fed, Janet Yellen announced her concern over growing inequality in the United States, revealing that she thought it was “appropriate to ask whether this trend is compatible with values rooted in ou …

Sound Money Project

Op-ed: Greek solvency requires political reform, support from populace

– March 2, 2015

A hard currency backed by specie like gold or silver imposes sound economic policies on the nations that use them, but currency established by central bank fiat requires sound policies to be established by political mechanisms in concert with the suppo …