Thanks to Warren Mosler for these quotes. Got them from his blog.
| Don Kohn (Former FRB Vice Chair):”I know of no model that shows a transmission from bank reserves to inflation”. Vitor Constancio (ECB Vice President): “The level of bank reserves hardly figures in banks lending decisions; the supply of credit outstanding is determined by banks’ perceptions of risk/reward trade-offs and demand for credit”. Charlie Bean (Deputy Governor BOE): in response to a question about the famous Milton Friedman quote “Inflation is always and everywhere a monetary phenomenon”: “Inflation is not always and everywhere a monetary base phenomenon." |
Of course, don't expect these things to be picked up by the media, academic economics, Wall Street, Congress or even Bernanke. The Fed, QE, monetary and fiscal policy have all become politicized and telling the truth about QE or deficits, does no good for those who are running the show.
"I know of no model that shows a transmission from bank reserves to inflation."
ReplyDeleteWhat about the model that says "My boyfriend said that because his bank always has excess reserves, he has more time to shop online for me & take me out on mid-day dates."
Ok let me clarify for Red Rock :
ReplyDeleteAfter 9/11 the economy tanked for reasons of 9/11 but also because in general things were going south anyway since the budget was balanced and all that.
Bush and his cronies went out and asked everyone to go shopping in the name of patriotism and all that.
Now, we have a worse situation, and NO WHERE are the Bushes, the Tea Party wackos, and anti-semitic Austrian Economic dingle berries are found asking Americans, the institutions, the states, and other entities to come out and spend and to shop in the name of patriotism.
Why ? because they are cornering Obama ( or trying to ) just like they did with Carter ( who did a great job of reducing spending which is why the economy tanked with him at guard ).
Why are they cornering Obama ? one of the reasons is yes that he is black, that he is probably a muslim, that he is a socialist, that he is spending too much money.
SO MR RED ROCK READ UP AND SHUT UP.