Bravo! As a reader who somewhat empathises with the Austrians this provides some really clear insight. However, should we expect that as interest rates rise, although Vd will fall, there might be a natural increase in D as banks are incentivised to lend more? Bank loan-to-deposit ratios are the lowest they've been since the '70s, wasn't inflation then also partly driven by increased lending? Pardon if you've already debunked that one!
Well done JK for distilling what would have been hours of lectures for econ students into a single blogpost. As Shakespeare said "brevity is the soul of finance".
Bravo! As a reader who somewhat empathises with the Austrians this provides some really clear insight. However, should we expect that as interest rates rise, although Vd will fall, there might be a natural increase in D as banks are incentivised to lend more? Bank loan-to-deposit ratios are the lowest they've been since the '70s, wasn't inflation then also partly driven by increased lending? Pardon if you've already debunked that one!
Thank you for broadening my understanding of these things, and for the paper by Xing, Xiaoyun et al.
Well done JK for distilling what would have been hours of lectures for econ students into a single blogpost. As Shakespeare said "brevity is the soul of finance".