Posts Tagged ‘NGDP’

Central Bank Revolution I: Market Monetarism Misdiagnosis (M3)

To begin to understand how central banks intend to reignite economic growth we have to understand that central bankers believe that changes in the quantity of money affect the price level, and for a short time, the level of economic activity, ie output.

 

By examining a classic monetary equation which became the foundation of Milton Friedman’s monetarism and central bank monetary policy we can see why there is potential for much more money printing.

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