Friday, April 20, 2018

Inflation does not compound

A neo-Fisherian experiment that hedges its New Keynesian bets


Long and variable on the interpretation of Fisherbequating relating growth and inflation.

My interpretation is that mids-pricings  of the past get paid off later, the  original monetary shock tending to neutrality.  That is  a Hamiltonian division between wealth on the ledger and wealth still in the pits. We  would expect a semi-random exchange between the two forms of wealth. We get quantum mechanical as the pits stay bounded in matching error.

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