Emerging Market Sensitivity to US Monetary Policy – What does the Fed think?
byEmerging market currencies have suffered from US interest rate increases The Dallas Fed proposes reserve/GDP ratio as a simple indicator of stress If tightening…
Economics
Liquidity and the stock market
byIn a market economy, a major service that money provides is that of the medium of exchange. Producers exchange their goods for money…
Beyond GDP to a New Road to Serfdom
byIt is a commonplace that there is more to life than money and the material benefits that it may provide someone. We often make…
The neutral interest rate myth
byIn his speech to the Economic Club of New York on November 28 2018, the Federal Reserve Board Chairman Jerome Powell said that…
Why velocity of money and the purchasing power of money are not related?
bySome commentators are of the view that when the velocity of money rises, all other thing being equal, the buying power of money…
Money growth and inflation – is there a connection?
byAccording to many mainstream economists, a lack of good correlation between the monetary growth and the growth rate of various price indexes casts doubt…
The Fed Is Tightening More Than It Realizes
byby Benn Steil and Benjamin Della Rocca at CFR https://www.cfr.org/blog/fed-tightening-more-it-realizes Before the 2008 collapse of Lehman Brothers, the Fed’s balance sheet stood at $925 billion—mostly U.S. Treasury securities. After…
Easy monetary policy and the pattern of consumption
byWith meagre resources at his disposal, an individual is likely to allocate these resources i.e. his wealth towards essentials such as food, clothing…
Coffee Sellers Are Not Fundamentally Different from Banks
byBy Joakim Book With the 2007-8 financial crisis came a splendid alphabetical soup of central bank interventions to stimulate financial markets, lower interest rates, provide…
The psychology of systemic consensus
byWe are all too familiar with established views rejecting change. It has nothing to do with the facts. Officialdom’s mind is often firmly closed…