One promising approach to boosting the potency of monetary policy at the zero bound is to promise to intentionally overshoot the inflation target after any extended period below target when policy is constrained. This policy works by raising expectations of future inflation and thus reducing the real rate of interest faced by households and firms.
Joseph E. Gagnon (PIIE) and Christopher G. Collins (PIIE) need a clue if they discuss currency banking. There is no primise the Fed can make longer than two years without a long term buy off from Congress. What does Gagnon and Collins offer Congress? Nothing but good intentions. Get a friggen clue, go back to school.
To make central banking independent, central banker need a long term deal from Congress that can hold for 15 years. At this point we have n issue to solve. So tell me, again, Gagnon and Collins, what exactly is your purchase price that lets your central bank make that promise on its own? Your bizarre proposal is just that, until we get a purchase price from the Senate. Most of the other bonehead banking theorists should get clues also.
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