MMT founders Warren Mosler and Randall Wray like to claim that ‘monetary policy has it backwards’, see these 1,5 min video quotes: To offer some more detailed explanation of why I do not subscribe to W. Mosler‘s claim, I‘ll sketch another, imho more coherent view of how interest rate policy ‚transmits‘ to the price level… Continue reading MMT’s claims on monetary policy: is ‘raising interest rates ‘actually inflationary’, lowering rates ‘actually deflationary’? And why is the ‘4th price of money’ (price level) missing in Perry Mehrling’s ‘Money View’, altogether?
Academy for New European Political economics