{"id":18049,"date":"2016-02-20T18:04:51","date_gmt":"2016-02-20T23:04:51","guid":{"rendered":"http:\/\/olduvai.ca\/?p=18049"},"modified":"2016-02-20T18:05:25","modified_gmt":"2016-02-20T23:05:25","slug":"silver-linings-keynesian-central-banking-is-heading-for-a-massive-repudiation","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=18049","title":{"rendered":"Silver Linings: Keynesian Central Banking Is Heading For A Massive Repudiation"},"content":{"rendered":"
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Silver Linings: Keynesian Central Banking Is Heading For A Massive Repudiation<\/a><\/h3>\n

For several years now the small coterie of Keynesian academics and apparatchiks who have seized nearly absolute financial\u00a0power through\u00a0the Fed\u2019s printing presses\u00a0have justified the lunacy of unending\u00a0ZIRP and massive QE on the grounds that there is too little inflation. The bureaucrats at the IMF even invented a lame-brained catch-phrase, calling\u00a0the purported scourge of money which retains most of its\u00a0value\u00a0\u201clowflation\u201d.<\/p>\n<\/header>\n

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This whole consumer inflation targeting\u00a0gambit, of course,\u00a0is an inherently\u00a0preposterous\u00a0notion because there is not a scrap of evidence that 2% consumer\u00a0inflation is better for rising living standards and societal wealth gains\u00a0than is 0.2%. And there is\u00a0much history and economic logic that points in exactly the opposite direction.<\/p>\n

Between 1870 and 1913 in the United States, for example, real national income grew at 3.5% per year\u2014\u2014the highest gain for any 43 year period in history. Yet the average inflation rate during that long period of capitalist prosperity was less than 0.0%. That was real \u201clowflation\u201d, and it was a blessing for the average worker, not a scourge.<\/p>\n

But this week the BLS itself let out a screaming, never mind! The core CPI for the 12 months ended in January rose by 2.21% and that\u2019s actually a tad higher than the 1.98% annual average since the year 2000.<\/p>\n

Please forgive the spurious accuracy of reporting the BLS\u2019\u00a0noise-ridden, dubiously constructed\u00a0CPI to the second decimal\u00a0point, but it\u2019s meant to underscore a crucial truth.\u00a0\u00a0Namely,\u00a0there ain\u2019t no inflation deficiency problem and never has been!<\/strong><\/em><\/p>\n

The whole 2% inflation mantra is just a smokescreen to justify the massive daily intrusion in financial markets by a power-obsessed claque of monetary central planners. They just made it up and then rode it to ever increasing dominance over the financial system\u2014-even though as recently as 15 years ago the 2% inflation\u00a0theory\u00a0was unknown outside a small circle of neo-Keynesian academic scribblers led by Ben Bernanke.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Silver Linings: Keynesian Central Banking Is Heading For A Massive Repudiation For several years now the small coterie of Keynesian academics and apparatchiks who have seized nearly absolute financial\u00a0power through\u00a0the Fed\u2019s printing presses\u00a0have justified the lunacy of unending\u00a0ZIRP and massive QE on the grounds that there is too little inflation. The bureaucrats at the IMF […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[68,123,5979,172,2120,303,305,418,426,434,467,661,662,1940,1939],"class_list":["post-18049","post","type-post","status-publish","format-standard","hentry","category-economics","tag-ben-bernanke","tag-central-banking","tag-contracorner","tag-cpi","tag-david-stockman","tag-fed","tag-federal-reserve","tag-imf","tag-inflation","tag-international-monetary-fund","tag-keynesian-economics","tag-qe","tag-quantitative-easing","tag-zero-interest-rate-policy","tag-zirp"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18049","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18049"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18049\/revisions"}],"predecessor-version":[{"id":18051,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18049\/revisions\/18051"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18049"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18049"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18049"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}