Monday , September 16 2019
Home / Edward Harrison: Credit Writedowns

Edward Harrison: Credit Writedowns

Our over-reliance on monetary policy is the problem

I am going to argue here that monetary policy is both less effective than fiscal policy, and that over-reliance on it unnecessarily politicizes monetary policy by putting unelected officials in too prominent an economic role. I would argue that monetary policy should never be the primary macro policy driver in any economy. Yet, when you look around the world it is in almost every advanced economy. It is certainly that way in the eurozone, where interest rates are negative and the...

Read More »

The Fed overtightened. Now it’s behind the curve. Recession awaits

Sorry for the alarmist post title. But the Fed has completely bottled it. I’ve been warning for some time that it could go this way. And now, we are in in the endgame. First, the Fed overtightened through 2018. Then, forced at gunpoint by financial markets into a retreat this year, it has been very slow to recognize the tightening financial conditions. Now, it is so far behind the curve that a major recession is  breathing down our necks. Let me put this all together below. And...

Read More »