Market Monetarism – Monetary Base Overdrive

Martin Wolf has written (HT Cullen Roche) an excellent article on the recent Bank of England paper. Here are his key summary points from that article: First, banks are not just financial intermediaries. The act of saving does not increase deposits in banks. If your employer pays you, the deposit merely shifts from its account to yours. ThisRead More

Thomas Palley on Steve Keen’s Model of Aggregate Demand

Thomas Palley’s paper is here: http://www.thomaspalley.com/docs/research/ad_and_debt.pdf (HT: Ramanan) Some time ago, a few of us were after Steve Keen in respect of his newly defined aggregate demand function, pointing to a time-inconsistency in its income and non-income flow of funds components. He has since corrected this, with a model whose principal defining equation is nowRead More