Well, like I always say, if you are not confused, then maybe you really don't understand monetary policy.
I agree with this post, and that the Inflation Bogeyman was again over-rated.
Not sure about the connection between monetary policy and inflation.
The way M2 grows is circumstantial; that is (primarily) people who sell real estate get huge gobs of money. (Buyers borrow money from commercial banks, who print the money, give it property buyers, then the buyers hand the loot over to sellers).
Would anyone design this property-goosing to be the mechanism to effect macroeconomic policy? But as fractional-reserve banking preceded central banking, that is what we have.
There is the additional question about QE. I think this is also an expansion of the money supply and a better one---essentially money-financed fiscal programs.
Money-financed fiscal programs could replace all this jiggering of rates and reserves, the clunky Federal Reserve and commercial banks, and recurrent starving or force-feeding of the property sector to obtain macroeconomic results.
Plus, taxpayers would not face ever-mounting bills for having borrowed money.
Well, like I always say, if you are not confused, then maybe you really don't understand monetary policy.
I agree with this post, and that the Inflation Bogeyman was again over-rated.
Not sure about the connection between monetary policy and inflation.
The way M2 grows is circumstantial; that is (primarily) people who sell real estate get huge gobs of money. (Buyers borrow money from commercial banks, who print the money, give it property buyers, then the buyers hand the loot over to sellers).
Would anyone design this property-goosing to be the mechanism to effect macroeconomic policy? But as fractional-reserve banking preceded central banking, that is what we have.
There is the additional question about QE. I think this is also an expansion of the money supply and a better one---essentially money-financed fiscal programs.
Money-financed fiscal programs could replace all this jiggering of rates and reserves, the clunky Federal Reserve and commercial banks, and recurrent starving or force-feeding of the property sector to obtain macroeconomic results.
Plus, taxpayers would not face ever-mounting bills for having borrowed money.
Japan is interesting.