What would Milton Friedman do now?
online.wsj.com
What would Milton Friedman do now?
1–10 of 18 posts
Re: What would Milton Friedman do now?
#2[deleted]
Re: What would Milton Friedman do now?
#3"The Friedman logic, though, makes the case for QE2." but only just after going through uncertainty and points against. The way the article is written sounds like the author wanted the conclusion regardless.
Re: What would Milton Friedman do now?
#4Short reply by Krugman: http://krugman.blogs.nytimes.com/2010/10/28/friedman-on-japa...
Re: What would Milton Friedman do now?
#5Short reply by Krugman: http://krugman.blogs.nytimes.com/2010/10/28/friedman-on-japa...
I found this helpful, as I am not familiar with the term: http://en.wikipedia.org/wiki/Liquidity_trap
Re: What would Milton Friedman do now?
#6Friedman would definitely support the Fed's actions. Bernanke is a loyal Friedman acolyte.
The "Helicopter Ben" reference comes from him quoting Friedman's term for creating money to prevent deflation: http://www.federalreserve.gov/BOARDDOCS/SPEECHES/2002/200211...
He credits the Fed's failure to do what it is doing now with causing the Great Depression in this speech: http://www.federalreserve.gov/BOARDDOCS/SPEECHES/2002/200211...
Friedman explains this himself in the following clip from his television series: http://www.youtube.com/watch?v=9V5OP-VmXgE
Re: What would Milton Friedman do now?
#7If you watch his "Free to choose" series (http://www.ideachannel.tv/), Friedman blamed the Fed for the depression because they didn't keep the money supply stable. Because of bank failures the money supply decreased by a 3rd. He never advocated massively increasing the money supply. In fact, he has been consistently against printing money because of it's leading to inflation.
You can interpret his comments on the BOJ in the article that he would support buying government bonds only as a way to provide liquidity to banks. In the current US scenario, the banks and corporations have enough capital, so I cannot see that Friedman would support QE2.
P.S. "Friedman believed in the power of money". Nonsense. He believed in the power of individual freedom.
Re: What would Milton Friedman do now?
#8If you watch his "Free to choose" series ( http://www.ideachannel.tv/ ), Friedman blamed the Fed for the depression because they didn't keep the money supply stable. Because of bank failures the money supply decreased by a 3rd. He never advocated massively increasing the money supply. In fact, he has been consistently against printing money because of it's leading to inflation. You can interpret his comments on the B…
I don't understand the downvote for this (so I voted it back to 1).
Generally speaking, the idea expressed here matches my own understanding (though I'm more specifically familiar with Hayek and Mises). Can anyone explain why bj_nortier_hn is wrong?
Re: What would Milton Friedman do now?
#9If you watch his "Free to choose" series ( http://www.ideachannel.tv/ ), Friedman blamed the Fed for the depression because they didn't keep the money supply stable. Because of bank failures the money supply decreased by a 3rd. He never advocated massively increasing the money supply. In fact, he has been consistently against printing money because of it's leading to inflation. You can interpret his comments on the B…
I don't understand the downvote for this (so I voted it back to 1). Generally speaking, the idea expressed here matches my own understanding (though I'm more specifically familiar with Hayek and Mises). Can anyone explain why bj_nortier_hn is wrong?
Downvoting it without posing a counter-argument doesn't help me in examining my own subjective beliefs. If I'm wrong, I want to know why.
Re: What would Milton Friedman do now?
#10If you watch his "Free to choose" series ( http://www.ideachannel.tv/ ), Friedman blamed the Fed for the depression because they didn't keep the money supply stable. Because of bank failures the money supply decreased by a 3rd. He never advocated massively increasing the money supply. In fact, he has been consistently against printing money because of it's leading to inflation. You can interpret his comments on the B…
Sorry, I don't think that is accurate.
Quoting wikipedia:
"[Friedman] claimed that, if the Fed had provided emergency lending to these key banks, or simply bought government bonds on the open market to provide liquidity and increase the quantity of money after the key banks fell, all the rest of the banks would not have fallen after the large ones did, and the money supply would not have fallen as far and as fast as it did. With significantly less money to go around, businessmen could not get new loans and could not even get their old loans renewed, forcing many to stop investing."
Intervening to prop up failing banks and creating money to buy bonds? Sounds a lot like... TARP.