Report Detail Summary

The Economy in Perspective: The Real Side of the Economy

August 01, 2017

The dismantling and reversal of QE will have other effects on the economy. As already mentioned, the Fed plans to reduce its balance sheet. Simple accounting suggests that, as the balance sheet is reduced, there will be a corresponding reduction of the monetary base. However, this alone is not enough to determine what happens to the quantity of MZM money circulating in the economy and what happens to the inflation rate.

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