Monetarism: Difference between revisions

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'''Monetarism''' is an economically [[file:Cap.png]] [[Capitalism|right]] ideology, whose general economic theory was created by [[File:Friedman.png]] [[Chicago School|Milton Friedman]] to cure inflation. He believes that the government's primary role in the economy should be monetary policy with the goal of keeping inflation under control. Specifically, he thinks that there should be a very low inflation rate (1%-3%), and he wants this to be as stable as possible, since it being stable eliminates the market distortion both non-stable inflation/deflation brings. In modern times, several Monetary Authorities, notably Former Federal Reserve Chair and Nobel Prize winner Ben Bernanke, have been monetarists. Monetarist policies were used by Bernanke during the 2008 Great Recession with expansion of QE (Quantitative Easing) and the overall expansion of Money Supply.

==History==

===The Federal Reserve Under Ben Bernanke (2006-2014)===

Ben Bernanke was elected by President George H.W Bush along with the U.S Senate as Federal Reserve Chair on February 1st of 2006, succeeding the acclaimed Chair Alan Greenspan. Bernanke himself was considered an Orthodox Monetarist, and his skill was soon put to the test two years after his appointment during the 2008 Housing Crisis. The Federal Reserve ramped up Money Printing, as well as QE, in an attempt to stabilize the economy and ease off the pain caused by MBS. While most economists call the Federal Reserve's efforts a success, a few others, such as the staunch anti-fiat-currency Representative Ron Paul, criticized the Fed and Bernanke for the ensuing stagflation of 2012.

 

 

==Beliefs==

Monetarism is an approach to Macroeconomics which stresses a large focus upon Monetary Policy instead of Fiscal Policy, in contrast to [[File:Keynes.png]] [[Keynesian School]]. Monetarism prefers Monetary Policy over Fiscal due to its belief that Monetary Policy is significantly easier to change than Fiscal Policy, and can have a far greater effect on the most important issue (to him) which is inflation. While Monetarism is quite different from Keynesianism, they both hold the axiomatic beliefs of Central Banking, Fiat Currency and so forth, and are usually combined in some form.

 

#Draw blue lines on both edges of the red stripe,

#Draw the eyes and you're finished!

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==Relationships==

===Friends ===

*[[File:Chilib.png]] [[Chicago School]] - My dad who neglects me at times.

*[[File:Fiscon.png]] [[Fiscal Conservatism]] - We agree that economic policies must be fiscally responsible and long-term sustainable.

 

=== Frenemies===

*[[File:Hayek.png]] [[Hayekism]] - Free Banking doesn't prevent inflation.

*[[File:Keynes.png]] [[Keynesian School]] - He believes the government should focus on government spending in times of crisis, I think the government should focus on money supply. Overall we still agree on central banking and the like, so we respect each other.

 

==Further Information==

===Literature===

*[https://books.google.com/books?id=Q7J_EUM3RfoC A Monetary History of the United States] by [[File:Friedman.png]] [[Chicago School|Milton Friedman]] and [[File:Chilib.png]] [[Chicago School|Anna Schwartz]]

*[https://openlibrary.org/books/OL1717100M/A_program_for_monetary_stability A Program For Monetary Stability] by [[File:Friedman.png]] [[Chicago School|Milton Friedman]]

 

===Wikipedia===

*[[w:Monetarism|Monetarism]]

*[[w:Clark_Warburton|Clark Warburton]]

*[[w:Monetary-disequilibrium_theory|Monetary disequilibrium theory]]

*[[w:Friedman's k-percent rule|Friedman's k-percent rule]]

 

==Navigation==

 

[[Category:Economic Systems]]

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