Brad DeLong — In Which I Try and Fail to Understand the Current State of Right-Wing Monetary Economics

The ground is shifting. The inflationistas back peddle.

On the videotape, Josh Bivens looks visibly flummoxed. I can see him thinking: “All of these guys are relatively orthodox quantity theory guys–they all expect a tripling of the monetary base to cause 200% inflation. And here they are, all saying that what you need to halt that 200% inflation is for the Fed to offer to pay 0.25%/year on reserves. Paying the banks $5 billion a year on their $2 trillion of reserves is enough to stop a 200% inflation in its tracks, and do so indefinitely. Do they really believe this?”
Apparently they do…

WCEG — The Equitablog
In Which I Try and Fail to Understand the Current State of Right-Wing Monetary Economics
Brad DeLong