Author says: "The fact is that the Fed does cause severe economic downturns, but not by tightening monetary policy. In the real world, every boom that occurs on the back of money-pumping and interest-rate suppression contains the seeds of its own destruction. The reason is that the falsification of prices resulting from the central bank’s efforts to stimulate economic activity leads to widespread malinvestment."

I agree with that, because risk was mispriced. But we know that the Fed failed to make up for the destruction of the commercial paper market and for the pulling of Heloc credit by failing to increase the money supply. So, the Fed probably made the recession much worse by not taking action to make up for that obvious shortfall. The Fed knew that GDP was crashing and just did nothing.

It is the Market Monetarists who correctly pointed this out, not the Keynesians.

Pretty weak in Nov and Dec of 2015.

You don't need to talk about ports to legitimately attack Donald Trump. But we have to look at the trend to see if this robust increase is maintained, right?

You just have to protect the collateral, right Goldman? You just have to keep yields low and bond prices high, right? After all, you can't raise interest rates anymore by much in order to stop inflation since you bet on low rates as have all the banks. It could almost be criminal, and at least it is unAmerican, Goldman.

Bruce, a question for you. Why don't the market monetarists, like Sumner, take into account the behavior of the primary dealers when determining the money supply?

One can never have enough good collateral to cover the crap collateral one offered in the beginning. :) More and more collateral is in the form of bonds, some highly rated and some not so highly rated.

And while she is doing this Ben Bernanke is writing an article saying don't worry about negative interest rates. Yeah, right.

It wasn't Goldman Sachs or some investment bank that convinced China that its consumers would bail the nation out was it? Lol, I could have told them that the Chinese consumer will always remain frugal. Decoupling is like liftoff of a Space X rocket. Not much happening.

Well, I have always viewed the Vietnam war in an unfavorable light, not because boomers fought it, but because it was a no win war that was deliberately understaffed so that it could continue on and on. That was a money maker for sure. It was a dirty little war with the military saying they had enough troops when they really didn't. There is some evidence that Westmoreland lied about troop requirements. The real heroes were boomers who protested the war, to stop the boys from being slaughtered by the hundreds each week!

True, except the boomers came after WW2. Just a small point, that the Greatest Generation and some of the Silent Generation were involved in the war.