Sound Money Project
The Sound Money Project was founded in January 2009 to conduct research and promote awareness about monetary stability and financial privacy. The project is comprised of leading academics and practitioners in money, banking, and macroeconomics. It offers regular commentary and in-depth analysis on monetary policy, alternative monetary systems, financial markets regulation, cryptocurrencies, and the history of monetary and macroeconomic thought.
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How to Make Disinflation Less Scary
“Economists are correct in warning the public about the likely costs of disinflation. But leaders within and outside the Fed should not sit back and take these costs as given.” ~ Peter N. Ireland
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Can Congress Rein in the Fed?
“As long as we’re stuck with a central bank, we should give it an unambiguous mandate and watch it like a hawk. Monetary policymakers answer to the people’s representatives, in Congress assembled. Let’s remind them.” ~ Alexander William Salter
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Modeling the Money Supply
“We have to be very careful about generalizing across money and banking regimes. Many features of one system don’t translate to others. Depending on the ‘rules of the game,’ the supply of money responds to the price of money in very different ways.” ~ Alexander William Salter
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Federal Reserve Operating Losses and the Federal Budget Deficit
“In 2023, the Fed will likely report tens of billions of dollars in operating losses as it raises interest rates to combat raging inflation. Will Fed losses increase the budget deficit as logic dictates they should, or will they be treated as an off-budget expenditure?” ~ Paul H. Kupiec & Alex J. Pollock
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How Common Has Private Currency Been?
“Private banknotes can still be found in Scotland, Northern Ireland, Hong Kong, and Macau, where they have not yet been banned or taxed out of existence.” ~ Lawrence H. White
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The Inflation Tide Appears To Be Turning
“If monthly core inflation rates are at or below 0.2 percent in August and September, we might more confidently conclude that the Fed is back on track. Until then, we can only hope for the best.” ~ William J. Luther
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Biden’s Student Loan Forgiveness Program is Poorly Targeted
“The student loan forgiveness program fails to help the very least well off while providing support for some of the most well off. It may be politically expedient, but it is difficult to justify on standard welfare grounds.” ~ William J. Luther
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Criminal Code
“The Tornado Cash ban is very disappointing. Rather than bolstering financial privacy, the U.S. government is making financial privacy a crime.” ~ Joshua R. Hendrickson & William J. Luther
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Why Will Inflation Remain So High For So Long?
“I cannot think of a good reason for inflation to remain high through 2024; but many bad reasons come to mind. The most likely explanation, in my opinion, is that Fed officials do not take their average inflation target very seriously.” ~ William J. Luther
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Understanding the Basics of Money Demand
“If nothing else, a cash-balances interpretation of the equation of exchange can help us better understand the relationship between the money supply and nominal income.” ~ Alexander William Salter
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The Fed Needs a Single Mandate
“A purchasing target would direct the Fed towards an achievable goal that would improve American households’ material wellbeing. Legislators from both parties should make a single Fed mandate a key part of their agendas.” ~ Thomas L. Hogan & Alexander William Salter
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No, This Is Not 1970s Style Stagflation
“The FOMC’s current policy stance has precipitated a recession that may modestly deepen as it tardily-but-effectively pursues its commitment to restraining inflation.” ~ James L. Caton
