Monetary System

We’re more than 3 years out from a crisis caused in part by these very same decision-making processes on compensation. So why is it that we don’t fully understand them yet?

Milton Friedman's 1948 article, "A Monetary and Fiscal Framework for Economic Stability" put forward a proposal according to which the government would run a balanced budget only at full employment, with deficits in recession and surpluses…

Is there any government body having a harder time of it these days than the SEC? Sometimes it feels like someone pinned a giant “Kick me” sign to its collective back. I’ve written previously about a key factor that I think is partly…

So why are these big name retailers suing the big banks. It's this chart that appears to be the smoking gun. Credit card interchange fees are the highest by a large margin. Clearly those charges that go into the bank and credit card…

Central Banks, whenever they buy any asset create new reserves. Commercial banks and people do NOT have the capacity to destroy those reserves. Once the Fed or ECB wires the money or creates that asset line item on its spreadsheet, there is…

We continue to witness remarkable developments in the intersection of the related fields of economics, finance, ethics, law, and regulation. Each of these five fields ignores a sixth related field – white-collar criminology. The six fields…

Senior former regulators are willing to be quoted by name asserting that Obama’s (not Bush’s) financial regulatory leaders are blocking lawsuits against fraudulent financial elites and their anti-regulatory co-conspirators because they fear…

Mr. Obama’s Secretary Geithner went to Europe met with EU leaders to demand that Greece make the write-downs voluntary on the part of banks and creditors. He explained that U.S. banks had bet that Greece would not default – and their net…

Every 60 days the Government Accountability Office issues a report on the various TARP programs. Each report looks at how the Office of Financial Stability, the body currently overseeing all TARP programs, is performing on a given metric.…

This week we begin a new topic: functional finance. This will occupy us for the next several blog posts. Today we will lay out Abba Lerner’s approach to policy.