If prices were perfectly flexible, the economy would get the inflation it needs, regardless of monetary policy - if necessary by deflating now so that prices can rise in the future.
The belief that it would be hard to gain the kind of credibility we need for monetary effectiveness is why I and others, notably Mike Woodford, believed that a strong fiscal stimulus was the option most likely to work in clawing our way out of a liquidity trap.
Purveyors of gift registry sites argue that consumers are, in fact, ready to make that change -- are prepared, in effect, to push present-giving closer to barter, as in "give me this, and I'll give you that". But they also admit that consumers will need a bit of monetary incentive to test this new approach.
To compare and add up with the same units, an estimate is needed of the monetary value of caretaker time devoted to their child during a fever.
Angola, to the south, has been receiving so much aid and investment from China that in 2006 it decided it had no need of the International Monetary Fund's billions and all the tiresome requirements for transparency and sound economic management that come with them.
No need for Keynesian institutions of monetary policy and demand management.
The report noted that "a transfer of decision-making power" from member states to the European Community (now Union) would be needed in "the fields of monetary policy and macroeconomic management".
The last thing a credible central bank needs is dog's breakfast of monetary policy, macro-prudential and micro-prudential, all the while under intense lobbying from special interests who have a great deal at stake.
In that case, "the withdrawal of monetary accommodation may need to begin sooner than currently anticipated in financial markets".
In testimony to Congress a fortnight earlier he had stressed the need for a pre-emptive tightening of monetary policy.
