Friday, April 15, 2016

The sin of low interest rates

I don't know this for sure but I think Milton Friedman said that rates and velocity were correlated and if he did say it, this has been know for a long time.

Raise rates without reducing the money supply and we will get serious inflation.  The question is how much inflation does the Fed want.  Oh.  The Fed has lost complete control over the money supply due to the large amount of reserves.

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