Monetary Policy

Price inflation is so difficult to predict, because there are so many moving parts: money supply, demand, money velocity, and supply of goods and services.

There's now no difference between monetary policy and other government programs designed to prop up firms, industries, and other favored groups. The Fed is simply another government planning agency.

The Fed and other central banks are entering into a huge money-printing experiment in hopes of keeping the government-spending machine going at full speed forever. The unintended consequences will be highly destructive.

Sieroń comments on Book and Sumner regarding the Cantillon effect, arguing that the Austrian analysis of the Cantillon effect is correct.

Now, more than ever, we're in uncharted waters when it comes to central banks and monetary policy. Economist Brendan Brown takes a look at where we are and what the future might hold for central banks' race to the bottom.

Central banks have decided that one of their main missions is to prevent deflation. But this only ends up causing the malinvestments that lead to economic busts.

After 2018, the US economy was already headed toward a recession. But bailouts and lockdowns have made things even worse.

The EU has now become essentially a makeshift, lawless regime designed to prop up bankrupt states. So much so, in fact, that even the German supreme court has become alarmed.

Rather than spurring real economic gains, the Federal Reserve’s unorthodox QE program has supported and extended the debt grid and generated asset exuberance. But this can only go on as long as there's capacity for more debt.

Why would an investor buy a bond that pays a negative interest rate? The answer lies in understanding how central banks manipulate the economy.