Wrong approach Scott

Why stop at price level targeting?
by Scott Sumner of EconLog: Library of Economics and Liberty


Scott, back on NGDP targeting.

NGDP targeting means target the currency outstanding. Let commerce split the difference between inflation and growth.  Member banks have that function, not the currency issuer.

Sandbox S&L really targets the bit error function, the market making risk for the currency release function.   The effect is that member banks can target NGDP all by themselves without any help.

Anyone talking about central banks needs to correct the MIT fallacy.  The central bank is not a monopoly, it gets about 70% of the currency market, and that percentage varies in the cycle.  Assuming the MIT myth gets us in a whole lot of trouble.