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Are US Consumers Evil Hoarders?


The whole argument revolves around the Fisherian "equation of exchange", as you can see here. Now, it may be true that the society-wide demand for money (i.e., for holding cash balances) has increased. Rising demand for money can indeed cancel some of the effects of an increasing money supply. However, it should be obvious that there is 1. no way of "measuring" the demand for money and 2. the "equation of exchange" is a useless tautology.

Consider for instance this part of the argument:

"Though American consumers might dispute the notion that inflation has been low, the indicators the Fed follows show it to be running well below the target rate of 2 percent that would have to come before interest rates would get pushed higher.

 That has happened despite nearly six years of a zero interest rate policy and as the Fed has pushed its balance sheet to nearly $4.5 trillion.

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