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Prof. Horwitz, what do you think of Scott Sumner's claim that monetary policy is the right's Achilles heel? Given his response, what is the Austrian answer? I am not saying you or Austrians are part of the "right". I am assuming he meant people who favour tight money in general.

Yes, the paragraph starts with, "Money is generally the medium of account, or the good in which other prices... " A couple pages after that, he states that the gold reserve ratio (r) was the "exogenous policy lever available to central banks."

miemax, he clarifies this on page 25

Dear Pr. Cowen,

Where do you think macroeconomics is heading? Will we see a growing consensus? PS : Your blog is great. Thank you

Hi Prof. Sumner, thank you for doing this. I have a few short questions : what do you think of interest rates as being a transmission mechanism for monetary policy? Can you say that the increases in the monetary base since 08 hasn’t really been inflationary only because of the IOR? Do you think velocity will ever recover under these circumstances (Fed under Yellen, passive, discretionary monetary policy)?