More on the Interest-Income Channel

Created
Mon, 27/02/2023 - 08:41
Updated
Mon, 27/02/2023 - 08:41
Last weekend, I wrote about Warren Mosler’s argument that the Fed’s rate hikes could be undermining its effort to bring down inflation. While Mosler is a leading proponent of Modern Monetary Theory (MMT), the notion that “monetary tightening” (conventionally defined as central banks raising interest rates) might cause inflation to run hotter isn’t unique to MMT.