Jeffrey Hummel
Quotes From
“Ben Bernanke versus Milton Friedman: The Federal Reserve’s Emergence as the U.S. Economy’s Central Planner” (2011)
- A bank panic that causes a drastic decrease in such measures of money as M2 and M1 stems from an increased demand for currency and reserves, the two forms of base money. In this case, a fall in the broader money stock and a fall in the velocity of the monetary base are exactly the same thing, and they become alternative ways of describing what happened during the Great Depression. . . . Thus, whether we label a particular decline in aggregate demand a monetary shock or a velocity shock can depend on how broadly or narrowly we define the money stock. #
Posts About
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Bubbles and Broad Monetary Aggregates: Toward a Consensus Approach to Business Cycles
A challenge for quantity-theoretic explanations of business cycles is that recessions manifest despite central banks’ scrupulousness to avoid falls in monetary aggregates, a fact which would seem to indicate a structural explanation. This paper argues that a broader and theoretically richer Divisia aggregate – which reflects changes in financial market . . .