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Good news - the Market Monetarist gospel is spreading across the world. The latest arrival is Petar Sisko's blog Money Mischief in Croatia. Petar blogs both in English and in Croatian. Petar has been a frequent commentator on my blog so I am happy that he is now taking the Market Monetarist message to Croatia. I like the fact that Petar has named his blog Money Mischief - undoubtedly after Milton Friedman's book. Money Mischief is one of my favourite books on monetary matters and I strongly considered naming my blog Money Mischief when I started it in 2011.
This is CNBC's Jeff Cox:
Well this is non-monetary, but I can't help myself. One of the top media stories in Europe this week is the "Horsemeat scandal".
It is very frustrating to follow the ongoing discussion of 'currency war'. Unfortunately the prevailing view is that the world is heading for a 'currency war' in the form of 'competitive devaluations' that will only lead to misery for everybody. I have again, again and again stressed that when large parts of the world is caught in a low-growth quasi-deflationary trap then a competition to print more money is exactly what the world needs. 'Currency war' is a complete misnomer. What we are talking about is global monetary easing.
Even though I am a Dane and work for a Danish bank I tend to not follow the Danish media too much - after all my field of work is international economics. But I can't completely avoid reading Danish newspapers. My greatest frustration when I read the financial section of Danish newspapers undoubtedly is the tendency to reason from different price changes - for example changes in the price of oil or changes in bond yields - without discussing the courses of the price change.
Milton Friedman used to talk about an interest rate fallacy - that people confuse low interest rates with easy monetary policy. However, I believe that we today are facing an even bigger fallacy - the exchange rate fallacy.
At the core of Market Monetarist thinking is the view that financial markets are incredibly important indicators of monetary policy conditions. That idea is certainly not new. Just take a look at this article from April 28 1938 (reproduced from the Australian newspaper The Courier Mail):
Maybe I am ignorant, but until recently I had never heard of the concept "fiscal devaluation" (at least not that term), but I fear it could be an idea that could have considerable political appeal, but as I understand the idea it smells of protectionism and the idea is based on a mis-diagnosing the reasons for the present crisis - particularly in the euro zone.
Larry White has a very insightful review of Bernard Lietaer and Jacqui Dunne's new book "Rethinking Money: How New Currencies Turn Scarcity Into Prosperity". As Larry writes in a Facebook update "I wanted to like the book more". I have the exact same feeling about much of Lietaer's work.
Thursday was a very interesting day for me. You might think it was so because Mark Carney - the next Bank of England governor - was testifying in the British parliament. But frankly speaking even though Carney said some interesting things I have to disappoint you dear Mark - I wasn't really listening. I had more important things to do.