The book explores the Federal Reserve's challenges in maintaining its independence amid a backdrop of persistently low and declining interest rates. It delves into the complex dynamics that threaten its ability to operate autonomously, highlighting the institution's struggle to adapt to evolving economic conditions while safeguarding its crucial role in the financial system.
How a Misguided Fed Experiment Deepened and Prolonged the Great Recession
The book explores the pivotal shift in U.S. monetary policy initiated by the Federal Reserve in October 2008, when it began paying interest on banks' reserve balances. This transition to a "floor system" fundamentally changed how the Fed influenced economic activity, relying on interest rates on reserves instead of traditional methods. The author argues that this new approach has led to significant and largely negative consequences for the economy, providing a critical analysis of its impact on financial stability and growth.
Focusing on monetary policy, George Selgin challenges the conventional goal of price stability, advocating instead for alignment with productivity trends through the "productivity norm." This updated edition of his acclaimed 1997 work presents a radical and original perspective that continues to provoke thought and debate in economic circles, solidifying its status as a mini-classic.
This book shows how a system of private banks without a central bank can bring about financial stability through self-regulation. If one bank stretches credit too far, it will be reined in by the others before the system as a whole gets out of control.
This work presents a groundbreaking analysis of the factors contributing to financial instability in the United States, challenging conventional views. It delves into the historical and systemic issues that have shaped the financial landscape, offering fresh insights into the interplay between economic policies and market behaviors. By examining key events and trends, the author provides a compelling narrative that redefines the understanding of financial crises and their underlying causes.
Exploring the pivotal role of private coinage in Great Britain's Industrial Revolution, the book highlights its impact on economic growth. It also delves into modern private-sector alternatives to government-issued currency, including digital currencies, cash cards, and electronic funds transfers. Additionally, it discusses the phenomenon of spontaneous 'dollarization' in various countries outside the United States, offering insights into the evolving landscape of money and finance.
Challenging conventional beliefs, this collection of essays argues that government regulation is a primary source of monetary and banking crises, rather than a stabilizing force. George Selgin, a prominent voice in the free banking debate, presents a provocative perspective on monetary order and deregulation. This work promises to ignite controversy and inspire further research, making it essential reading for students and researchers in monetary economics, banking, and economic policy.