Earlier in the week, Nick Rowe provided this well thought out (and lengthy) post:
Teaching Notes on Banks and Money
Also, what happened in 2008? Why didn't the cut in interest rates prevent aggregate demand from falling?
http://worthwhile.typepad.com/worthwhile_canadian_initi/2013/09/interest-rates-and-aggregate-demand.html
A lesson on comparative advantage:http://worthwhile.typepad.com/worthwhile_canadian_initi/2013/09/teaching-comparative-advantage-barter-vs-money.html
Two market monetarists finally get to meet each other - Scott Sumner and Lars Christensen. Of course Lars can really make a person smile by being his hyper enthusiastic self:
http://marketmonetarist.com/2013/09/21/visiting-scott-in-boston/
And they "agree to disagree" about the taper:
http://marketmonetarist.com/2013/09/18/no-tapering-but-no-rule-either-net-net-that-is-bad/
As for central bankers who think they can "beat the market":
http://marketmonetarist.com/2013/09/24/macroprudential-follies-and-procyclical-central-bankers/
Speaking of taper, that's the question Scott Sumner asked in his first article for The Week. Why do it?
http://theweek.com/article/index/249697/we-need-easier-money-so-why-taper#
Scott explores some confusions in the relationship between interest rates and money, in this post: Interest rates and the face/vase problem
Some explanation regarding John Cochrane and liquidity traps:
http://www.themoneyillusion.com/?p=23739&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Themoneyillusion+%28TheMoneyIllusion%29
The Fed non-taper turned out to be a pretty big deal. And when Tyler Cowen questioned why emerging markets would react so, Scott reminds him that Monetary policy is a really big deal.
Bill Woolsey also notes the continuance in QE:
http://monetaryfreedom-billwoolsey.blogspot.com/2013/09/qe-continues.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+MonetaryFreedom+%28Monetary+Freedom%29
He highlights a post by Ryan Avent, "Missing the forest for the QEs":
http://www.economist.com/blogs/freeexchange/2013/09/monetary-policy-1
and also adds clarification for Nick Rowe's discussion regarding interest rates, linked above.
Marcus Nunes shows - in graphs - the factors that the Fed chose to overlook in a fateful meeting, five years ago: http://thefaintofheart.wordpress.com/2013/09/18/5-year-anniversary-of-a-fateful-decision/
The Fed keeps pulling new tricks out of its hat as growth slows...
http://thefaintofheart.wordpress.com/2013/09/18/a-queer-policy-indeed/
Aaand, what we have here is a failure to communicate:
http://thefaintofheart.wordpress.com/2013/09/20/forward-guidance-is-like-a-primitive-gps/
http://thefaintofheart.wordpress.com/2013/09/23/best-kind-of-forward-guidance-keep-mum/
http://thefaintofheart.wordpress.com/2013/09/23/monetary-policy-used-to-be-a-serious-matter/
http://thefaintofheart.wordpress.com/2013/09/24/no-matter-the-eloquence-behind-the-defense-forward-guidance-is-still-a-convoluted-manner-to-do-monetary-policy/
Justin Irving runs simulations for NGDPLT with measurement error, and in the process, notes that the simulations suggest price level targeting would be a poor substitute:
http://economicsophisms.com/2013/09/23/simulating-ngdplt-with-measurement-error/
David Beckworth provides evidence that monetary policy can still be quite effective at the zero bound: http://macromarketmusings.blogspot.com/2013/09/monetary-policy-at-zlb-three-quasi_25.html
David also shares an exchange he had with Miles Kimball re the Fed's new fixed rate:
http://macromarketmusings.blogspot.com/2013/09/further-ossification-of-zero-lower-bound.html
James Pethokoukis of AEI has a 5 questions for five days series this week, regarding market monetarism and quantitative easing. Here is the first post (September 23rd):
http://www.aei-ideas.org/2013/09/market-monetarism-and-quantitative-easing-5-questions-in-5-days-part-1/
Also, in his article for The National Review, Pethokoukis stresses that QE is working:
http://www.nationalreview.com/article/359216/right-quantitative-easing-james-pethokoukis
George Selgin gave a talk on Free Banking recently, in which he asked: what is the counterfactual for central banks? http://cafehayek.com/2013/09/george-selgin-on-free-banking-and-the-free-society.html
David Glasner provides the second installment on Hawtrey's Good and Bad Trade:
http://uneasymoney.com/2013/09/24/hawtreys-good-and-bad-trade-part-ii/
Britmouse reminds us that government attempts to control prices are not the way to a better marketplace: http://uneconomical.wordpress.com/2013/09/25/relative-price-changes-are-a-good-thing-price-controls-are-not/
The Browser picked up this story about Janet Yellen recently:
http://www.businessweek.com/articles/2013-09-19/who-is-janet-yellen-a-look-at-the-front-runner-for-the-next-fed-chairman#p1
And just for fun, I thought some of my readers might enjoy an illustrated brief history of U.S. government misadventures with tax dollars, from Business Pundit:
http://www.businesspundit.com/american-tax-dollars-your-hard-earned-money-at-work/
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