Sunday, 20 August 2017

Monthly Archives December 2015

The value of our money

Posted by Jerry Jordan
December 22, 2015

The purchasing power of money over time depends on its relative abundance or scarcity. People choose to hold money balances for a variety of reasons, all of which economists lump together as “the demand for money.” It is crucially important that this is understood to be a desire to hold on to, rather than spend, […]

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The long run benefits of a monetary policy rule

December 21, 2015

When teaching undergraduates or talking with non-economists, I usually argue that, while the Fed can affect aggregate demand (or nominal spending), it has no effect whatsoever on aggregate supply. If economic output declines because productivity growth is lower, there isn’t anything the Fed can do. Output is lower than it would have been with higher […]

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Monetary predictability

December 14, 2015

Supposing we decide a formal monetary constitution is a good idea, what properties should it have?  What essential features of money must a monetary constitution safeguard?  Again referencing James Buchanan, we know that money has properties that render it similar to weights and measures.  Money is a yardstick; if the definition or value of money is […]

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Money, inflation, and central banks

Posted by Jerry Jordan
December 2, 2015

Milton Friedman famously declared that inflation is always and everywhere a monetary phenomenon.  While that no doubt remains a universal principle, it is not the same (as some people think) that inflation is a central bank phenomenon.  Certainly, before central banks were created by governments there was inflation when Spanish galleons returned from the new world […]

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Bank regulations continue to hinder the U.S. recovery

December 1, 2015

This article appeared in the December 2015 issue of Globe Asia.  By Professor Steve H. Hanke Money matters — it’s one of Milton Friedman’s maxims that I repeat often in my columns. Since the Northern Rock bank run of 2007 — the “opening shot” of the financial crisis — the money supply, broadly measured, in the […]

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