Still trying to make sense of QE3? Michael Darda provides some great perspective on it in this Bloomberg interview:
Cardiff Garcia of the Financial Times and Greg Ip of the Economists also weigh in on the meaning of this new program. Finally, for insights on why this program pushes U.S. monetary policy in the right direction for the long run, see piece my piece with Ramesh Ponnuru in the National Review and Scott Sumner's article in National Affairs.
P.S. Here is why conservatives should be happy about QE3. And yes, Milton Friedman would also view QE3 as a step in the right direction.
David, not to sound naive but to a layman how would you explain that QE3 is not actually, in effect, stealth NGDP targeting?
ReplyDeleteI wonder if the BoJ's surprise move today was further proof of the Fed's monetary superpower status.
ReplyDeleteRavi,
ReplyDeleteExcellent point.
Conservatives will be happy about QE3 when they get obama out of office.
ReplyDeleteIs QE3 an sterilised operation, professor? If it is, why will money supply increase or cause inflation?
ReplyDeleteAlso, how will it lead to improvement of unemployment situation except other than probably jobs at these real estate agents?
And isn't unemployment improvement automatically associated with increase in inflation too(Philips curve)? Should we be too concerned about inflation so long as it doesn't appear to be leading to hyperinflation?