Over the first 100 years of Federal Reserve System history, the United States enjoyed both price stability and the absence of banking crises in only about a quarter of those years.
Unwelcome monetary conditions hold sway in the Euro Area, where the European Central Bank has allowed money supply growth to fall precipitously. This is causing unnecessary stress for European workers and businesses, generating slower than expected inflation and contributing to sluggish economic growth as well.
The following come from remarks delivered by Martin Feldstein before the March 2014 Shadow Open Market Committee conference.
I want to look ahead, just for a couple of minutes, about future
The chart below from my book, Why Capitalism?, shows that income inequality declined in all countries during the early- and mid-20th century. Until 1930, the federal government in the United States ran budget surpluses in two-thirds of the non-war years. It spent no more than three or four percent of GDP. There was very little welfare state
Seniors, wake up and call Janet Yellen. With an increase in interest rates next year, as Chair Yellen implied in her press conference on Wednesday, she can restore your savings accounts to relevance. The end for low rates might be in sight, and that is good news, despite the initial reaction from markets.
Economic performance continues to improve and move toward normal, while the Fed’s monetary policy is far from normal. The economy is in its fifth year of expansion, the unemployment rate has fallen faster
The FOMC statement and press conference on March 19 mark the beginning of the Yellen era at the Fed. Much of the current chatter has centered on the Fed’s communication
Capitalism is not a utopian system, but there is no better system for providing growth and personal freedom. Capitalism’s known alternatives offer less freedom and lower growth, and the “better alternatives” people imagine are almost always someone’s idea of utopia. Libraries are full of books on utopia
The Federal Open Market Committee has an explicit, two percent U.S. inflation target. That announcement, made in January 2012, promises that the monetary policy mistakes of the 1970s will never be repeated, and offers