Archive for August 29th, 2010

The Misinterpretation of the Keynesian “Liquidity Trap” »

Economists and pundits, who contend that the Federal Reserve System has little room to maneuver in using monetary policy to jump-start our anemic economy, often have claimed that America is mired in a Keynesian liquidity trap, a situation in which the demand for money is unresponsive to changes in market interest rates. After all,…
Read More »