“Diehards”

17 months ago I posted: “PASCAL SALIN, NOMINALLY A FRENCHMAN, IS JUST AS GERMAN AS JENS WEIDMANN”.

Now he´s back with “Money and Micro-Economics

To many “Austrians” all others are Keynesian, so that according to PS:

 “The fashionable idea of ‘market monetarism’ would be better described as ‘market Keynesianism’. Rather than trying to offset reductions in growth by tolerating higher inflation(!), monetary policy should be used to try to keep the growth in the money stock constant, thus allowing the economy to adjust to changes in real conditions.

Market Monetarism is not about “tolerating higher inflation” to offset reductions in growth. It is about striving to maintain Nominal Stability, especially in the face of supply shocks that reduce growth and increase inflation!

And he gets cynical when he writes:

Low growth in Japan over the last two decades has been caused by real factors. There is no obvious relationship between low growth in Japan and the periods of tight monetary policy. Indeed, if anything, higher growth rates seem to follow periods of tight monetary policy.

He would profit from readingJAPAN: POSTER CHILD FOR NGDP TARGETING

HT Mateo Marini

4 thoughts on ““Diehards”

    • Matteo—what does Pascal Salin look like? A little bit dark and furry? My Uncle Jerry disappeared years ago, but his favorite saying was, “I don’t care if it is true, I still don’t believe it.”
      perhaps Pascal is my long lost uncle!

  1. “…Try to keep the growth in the money stock constant…” Oh, my, a glutton for punishment (likely of others). I don’t understand the hardliners who prefer unnecessary liquidation to any form of disaster mitigation in the slightest.

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