Although likely intentional, I was surprised to not find any discussion of the "don't fight the FED" mantra and extensive financialization of the economy as being related to Central Bank excesses.
Thoughtful, comprehensive, and masterful. I will be using this essay in its final form when we get it in my money, banking and financial markets classes for the foreseeable future. I do not think anyone but you could have written this essay, John. Thank you for it.
Way too long and clearly in need of some rewrite which you have acknowledged.
My suggestion would be to just address what the role of the Fed should be in modern times and go from there. I dislike the dual mandate and view price stability as the only mandate the Fed should have.
As to accountability i wonder this: A Fed governor i believe is appointed for 14 years and cannot be fired ex for cause whatever that standard might be. That pushes back against accountability to some degree as Fed members can listen to and then ignore what any accountability body says to it.
Just finished Robert Hetzel’s The Federal Reserve: A New History. He ends his narrative in mid-2020, but this essay provides a great update, and could even serve as an additional chapter.
Hetzel wants more transparency at the Fed, and believes that one way to get it is by the use of a “model by committee” approach, pp. 606 ff. I’ve always viewed committees as no smarter than a flock of birds, so I was surprised to see that in an otherwise erudite discussion. But other than that one shortcoming I was not able to find much to disagree with.
Many thanks for your detailed analysis. Very helpful.
TLDR
"Central bank independence is not an absolute virtue."
Lost me right there, amigo.
Sometimes the rest of a paragraph explains an apparently puzzling first sentence.
Sometimes you set off on the wrong azimuth and never get to the right place. No amount of whipped cream can make bullshit into birthday cake, amigo.
Although likely intentional, I was surprised to not find any discussion of the "don't fight the FED" mantra and extensive financialization of the economy as being related to Central Bank excesses.
Thoughtful, comprehensive, and masterful. I will be using this essay in its final form when we get it in my money, banking and financial markets classes for the foreseeable future. I do not think anyone but you could have written this essay, John. Thank you for it.
Way too long and clearly in need of some rewrite which you have acknowledged.
My suggestion would be to just address what the role of the Fed should be in modern times and go from there. I dislike the dual mandate and view price stability as the only mandate the Fed should have.
As to accountability i wonder this: A Fed governor i believe is appointed for 14 years and cannot be fired ex for cause whatever that standard might be. That pushes back against accountability to some degree as Fed members can listen to and then ignore what any accountability body says to it.
Just finished Robert Hetzel’s The Federal Reserve: A New History. He ends his narrative in mid-2020, but this essay provides a great update, and could even serve as an additional chapter.
Hetzel wants more transparency at the Fed, and believes that one way to get it is by the use of a “model by committee” approach, pp. 606 ff. I’ve always viewed committees as no smarter than a flock of birds, so I was surprised to see that in an otherwise erudite discussion. But other than that one shortcoming I was not able to find much to disagree with.
Many thanks for your detailed analysis. Very helpful.
Minor Typo: it's the Major Questions Doctrine, not the Major Doctrines Question.
Thanks!