Fundamentally I think central banks have full control of nominal spending and therefore also inflation. Therefore, to me there is no liquidity trap. However, there can be a mental or an institutional liquidity trap if for example a central bank refuses to take the necessary steps to permanently increase the money base. I believe we […]
All posts found when searching for keynesian stimulus
A (Keynesian-Monetarist) proposal to shock the euro zone out of the crisis
Posted by Lars Christensen on March 4, 2020
https://marketmonetarist.com/2020/03/04/a-keynesian-monetarist-proposal-to-shock-the-euro-zone-out-of-the-crisis/
“Make America Keynesian Again”
Today I was asked to do an interview with a Danish radio station about Donald Trump and about whether one could say anything positive about him or rather about his economic agenda. I declined to do the interview. I frankly speaking has nothing positive to say about Trump. To me Donald Trump is an absolutely […]
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Posted by Lars Christensen on November 9, 2016
https://marketmonetarist.com/2016/11/09/make-america-keynesian-again/
“Make America Keynesian Again” part 2
In yesterday’s blog post I wrote about why I believe it is the combination of Donald Trump’s fiscal stimulus plans (infrastructure investments and tax cuts) combined with the Federal Reserve’s willingness not to (fully) offset this, which has pushed inflation expectations in the bond markets up very significantly since Tuesday. If the Fed’s inflation target […]
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Posted by Lars Christensen on November 11, 2016
https://marketmonetarist.com/2016/11/11/make-america-keynesian-again-part-2/
The real problem is a nominal problem – also in 2016
In 2009 Scott Sumner wrote an article – The Real Problem was Nominal – in which he explained – was later became known as the Market Monetarist explanation for the causes of Great Recession. The Market Monetarist explanation for the Great Recession is that the Federal Reserve (and other central banks around the world) allowed monetary […]
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Posted by Lars Christensen on February 11, 2016
https://marketmonetarist.com/2016/02/11/the-real-problem-is-a-nominal-problem-also-in-2016/
Belka-gate – the Polish version of the Sumner Critique?
A key Market Monetarist insight (it is New Keynesian insight as well…) is that budget multiplier is zero if the central bank says it is so. Or rather it the central bank targets inflation, the price level or nominal GDP then the central and will offset any shock – positive or negative – to nominal […]
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Posted by Lars Christensen on June 16, 2014
https://marketmonetarist.com/2014/06/16/belka-gate-the-polish-version-of-the-sumner-critique/
Orphanides also wonders what happened to the ECB’s monetary pillar
Yesterday the Shadow Open Market Committee (SOMC) held its regular semi-annual meeting in New York. It is no secret that many of the members of the SOMC have had a large influence on my monetary thinking – just to mention some of them Bennett McCallum, Michael Bordo, Peter Ireland, Marvin Goodfriend and Charles Calomiris all […]
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Posted by Lars Christensen on November 5, 2014
https://marketmonetarist.com/2014/11/05/orphanides-also-wonders-what-happened-to-the-ecbs-monetary-pillar/
No ‘General Theory’ should ignore the monetary policy rule
John Maynard Keynes famously titled his magnus opus from 1936 The General Theory of Employment, Interest and Money. However, General Theory, as it is generally known, is nothing of the kind. It is not a General Theory of macroeconomics – rather it is a specific theory of macroeconomics making very specific assumptions about the workings […]
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Posted by Lars Christensen on January 23, 2014
https://marketmonetarist.com/2014/01/23/no-general-theory-should-ignore-the-monetary-policy-rule/
The “Weidmann rule” and the asymmetrical budget multiplier (is the euro zone 50% keynesian?)
During Christmas and New Years I have been able to (nearly) not think about monetary policy and economics, but I nonetheless came across some comments from Bundesbank chief Jens Weidmann from last week, which made me think about the connection between monetary policy rules and fiscal austerity in the euro zone. I will try address these […]
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Posted by Lars Christensen on January 2, 2014
https://marketmonetarist.com/2014/01/02/the-weidmann-rule-and-the-asymmetrical-budget-multiplier-is-the-euro-zone-50-keynesian/
It is time to stop worrying about austerity – also in the UK
I have a piece in City AM today on the impact of fiscal austerity in the UK: FIVE years ago, nearly every macroeconomist agreed that central banks determined aggregate demand (total spending in the economy), and that fiscal stimulus was therefore unnecessary to lift depressed economies. Conversely, fiscal austerity was seen as irrelevant at best […]
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Posted by Lars Christensen on September 11, 2013
https://marketmonetarist.com/2013/09/11/it-is-time-to-stop-worrying-about-austerity-also-in-the-uk/
Christmas musings on life, money and blogging
As year is coming to an end I am sure that a lot of you like myself are reflecting on life and the world you live in. Here is a bit of what I have been thinking about this year and about what I think will be my focus in my blogging in the coming […]
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Posted by Lars Christensen on December 26, 2013
https://marketmonetarist.com/2013/12/26/christmas-muslings-on-life-money-and-blogging/
