John Taylor on auditing all the world’s Feds.

longandvariable

This paper explains John Taylor’s view that if only central banks committed to monetary policy rules, international monetary disorder, and indeed large-scale capital flows, would be eradicated.

It’s an extension of his earlier argument that the US’ financial crisis and recession was caused, predominantly, by a departure from the Taylor Rule for monetary policy, and by fiscal uncertainty.

I didn’t find the earlier arguments convincing, and this one doesn’t persuade me either, for related reasons.

This new contribution repeats a problem with the original one, the contention that monetary policy was too loose in the early 2000s.  This was dealt with convincingly by  Bernanke in 2010.  The Fed set rates pretty close to a ‘forward-looking’ Taylor rule in which one inserts not current, but forecast inflation.  Very low rates back then was to head off forecast deflation.

The proposal amounts to assuming away one aspect of the problem. …

View original post 605 more words

One response

  1. “In the US, there are a long list of non-monetary causes suggested. A failure of risk management in systemically important banks and shadow banks; political interference in the government agencies tilting lending towards sub-prime; a failure to regulate; ….”

    FED-a ne morete razumeti, če ne veste zakaj in kako je nastal. Ne gre za nikakršno čisto monetarno institucijo, temveč predvsem za ekonomsko orodje, ki omogoča največji ekonomski “leverage” povsem določeni politični in interesni skupini (skupini globalnih investicijskih bank in družin, ki imajo kontrolo nad njimi). Gre za največji primer “pajdaškega kapitalizma” in “ugrabitve države” v zgodovini človeštva. Gre za institucijo, ki so jo v petem poskusu, v boju dolgem 130 let , leta 1913 tik pred božičem nezakonito ugrabili ameriški državi (od takrat na USD bankovcu nič več ne piše “US note”, temveč “FED note” – ameriški dolar že sto let ni več denar ameriške države , ampak zadolžnica privatne institucije).

    Audit the FED. Absolutno. Od leta 2010 je ameriški senat vedno blokiral vsak poskus revizije FED-a. Zakaj neki, če gre le za nedolžno monetarno institucijo, ki deluje v dobro ne samo Amerike, ampak menda celega sveta? Kdaj smo nazadnje revidirali Banko Slovenije?

%d bloggers like this: