What are central banks doing, according to King

What King said was:

“Conventional wisdom attributes the [post-2008] stagnation largely to supply factors as the underlying growth rate of productivity appears to have fallen. But data can be interpreted only within a theory or model. And it is surprising that there has been so much resistance to the hypothesis that, not just the United States, but the world as a whole is suffering from demand-led secular stagnation.”
“No one can doubt that we are once more living through a period of political turmoil. But there has been no comparable questioning of the basic ideas underpinning economic policy. That needs to change.”

We have gone through the loop, we have it priced.  Traders knows we are at the end of a normal central bank monetary cycle.  Once through the loop, the loop is priced.  So, the central banker wants to escape the recession cycle but traders have the monetary cycle hedged.

And that is why we have synchronous rebellion.  The new generation is viewing and pricing the complete monetary cycle, they cannot afford it.  But worse, our small states are facing extinction, the Senate is now ineffective.

The fundamental mistake all parties have made about this is that we are a self sampled system and we rescale operations on an ongoing basis.  There is no constant returns to scale.  This means the central banker has to back out of the balance sheet the same way it entered.  Otherwise people notice the loop is complete, they get a deja vu, Shannon bandwidth requirements are met and we get a hard quantization which is difficult to overcome.

This is the hysteresis effect Delong talks about. Loop cost.  Now the millennials are looking at the 40 year loop cost of the banking regime. This is why sandbox theory has adiabatic change in which the system adapts to eany changed node in distribution before altering another. The loop is multiple nodes, a requant as i have defined it.

What is the price of the 40 year monetary cycle, or what is the estimated market price of the right to coin? No economists can answer this, that is the clue that they are clueless. They should be able to price the 'right to coin'.

A good estimate is a half point, and it has not been paid in 40 years. Users of central bank currency owe about 22% of GDP to Congress. Unpaid, the uncollected loop cost from the central bank repeating, once again, its generation regime change, then claiming the service is free once again.

If economists cannot work from supply and demand theory to a sound estimate of right to coin then they have either failed chapter 1 or lied in chapter 2-22 of econ 101.