Central Banking

Monday, June 25th, 2018

The Fed has a lot of policy tools, to be sure. But, traditionally — that is, when the Fed was operating in a corridor system — it exerted influence on the FFR primarily through its open-market operations.

Wednesday, June 20th, 2018

A recent NBER working paper studies what shapes Federal Open Market Committee member opinions.

Monday, May 21st, 2018

Rule-of-law monetary systems are more ethically justifiable. They also work better.

Thursday, May 10th, 2018

Sound money and the progress of civilization are inexorably entwined. Those who would sever this link for the perceived short-run benefits of monetary macro-management and fine-tuning should beware of the harm they court.

Wednesday, May 2nd, 2018

Hayek’s commodity reserve standard would automatically serve to stabilize prices and output. In our discussion of rule-based monetary policy and sound money, the mechanics and principles guiding Hayek’s proposal deserve careful consideration.

Monday, April 30th, 2018

In August, it will be 10 years since the Federal Reserve balance sheet exploded in size. How does it look now?

Monday, April 30th, 2018

The idea that a central bank might be constrained by rules is problematic. It merely moves the central bank's choices to the more abstract level of selecting and interpreting rules.

Wednesday, April 18th, 2018

If the language of commerce is quid pro quo, money is its grammar.

Monday, April 16th, 2018

If macroeconomists do not want to take responsibility for crises, then they should refrain from endorsing unstable monetary institutions.

Tuesday, April 10th, 2018

A trade war would not only make the United States less productive. It would also make monetary policy more difficult.

Wednesday, April 4th, 2018

Through incentive and information problems, the Fed–rather than free markets–caused the 2007-8 financial crisis.

Saturday, March 31st, 2018

Financial markets naturally promote monetary equilibrium. At their best, central banks attempt to emulate the functions of financial markets.

Monday, March 5th, 2018

Discretionary central banking places immense information burdens on central bankers.

Sunday, March 4th, 2018

If the monetary authority is targeting inflation or nominal income growth, fiscal policy is either unnecessary or ineffective.

Thursday, February 15th, 2018

Dear Mr. Keynes: Much of your open letter to President Roosevelt, seems so appropriate to be above criticism.... Unfortunately, portions of your advice seem somewhat perplexing.

Sunday, February 11th, 2018

Yellen’s Fed did little to put monetary policy on a sustainable long run path.

Friday, February 9th, 2018

Central banking is the institutionalization of irresponsibility in monetary policy.

Monday, February 5th, 2018

The chief problem with modern central banking is that it’s discretionary.

Friday, January 26th, 2018

Victor Morawetz worried that regional differences would undermine central bank independence.

Wednesday, January 17th, 2018

My theory: the paper is written for bankers and policy makers of an older generation who have heretofore ignored or dismissed crypto-based innovations. They might know something about money and banking. But they know next to nothing about computer science, digital resources, and cryptography. As a result, the paper speaks in the plainest-possible English about these technical topics. It then turns to debunking the most common myths about crypto.