Monday, 27 March 2017

Author Archives Jerry Jordan

“Strong” and “Weak” Currencies

Posted by Jerry Jordan
January 10, 2017

Is a “strong dollar” good or bad?  If the currency of another country is pegged to the US dollar, and the US dollar is “strong,” is that good or bad for the other country? A recent Wall Street Journal article was titled “Heat is on Currencies with Pegs to Dollar” and the subtitle was “The […]

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Tools of Monetary Policy

Posted by Jerry Jordan
December 13, 2016

For several decades the money we use in everyday life is “fiat currency.”  That is, it is created by central banks and its value is not anchored to anything of intrinsic worth such as gold.  The workings and decision making of central banks is therefore important, and does not need to be a subject of […]

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Monetary debates

Posted by Jerry Jordan
November 14, 2016

In recent decades, the “big debate” among monetary economists and policy makers was “Rules versus Discretion.”  That debate accepted that the various tools/instruments available to monetary policymakers are well known.  Implicit is that the linkages between open market operations of the central bank’s trading desk and the objectives of monetary policies have been defined and […]

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Op-ed: What Brexit means for the euro

Posted by Jerry Jordan
November 7, 2016

This article originally appeared in Forbes International political and economic news in recent weeks was filled with stories and analyses of the United Kingdom referendum to leave the European Union (EU). The immediate results of the vote included the resignations of the British Prime Minister and other government leaders, as well as a substantial decline […]

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The contractionary, contradictory nature of negative interest rates

Posted by Jerry Jordan
October 12, 2016

A negative interest rate imposed by a central bank on reserve balances of commercial banks is not an interest rate at all.  It is a tax.  As such, like all taxes, it transfers resources from the private sector to the government sector and has a contractionary effect on economic activity.  The European central banks and the […]

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Op-ed: The age-old problem of low interest rates

Posted by Jerry Jordan
June 16, 2016

This piece originally appeared in Forbes Earlier this year, Michael Walker of the Fraser Institute in Vancouver, Canada released a paper that deserves the attention of everyone interested in the subjects of central banking, inflation and interest rates. In it, he makes a claim that could fundamentally change our understanding of monetary economics: An aging population (think of […]

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