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Monetary in sentence

5081 examples of Monetary in a sentence

As I argued in a recent International Monetary Fund paper, the technical case for monetary finance is indisputable.
But these complexities simply argue for a cautious approach to the scale of monetary finance and the careful use of tools – such as mandatory-reserve requirements – to constrain subsequent knock-on effects.
If monetary finance is no longer prohibited, politicians might use it to curry favor with political constituencies or to over-stimulate the economy ahead of an election.
Hamada oddly suggests that proponents of monetary finance ignore this risk; but in my own IMF paper, and in Bernanke’s recent blog post, it is a central concern.
History provides many examples of excessive monetary finance, from Weimar Germany to the many emerging economies where governments have pressured central banks to finance large fiscal deficits, with high inflation the inevitable result.
So a valid argument can be made that the dangers of excessive monetary finance are so great that it should be prohibited entirely, even if in some circumstances it would be the best policy.
Bernanke, for example, has proposed giving independent central banks the authority to approve a maximum quantity of monetary finance if they believe doing so is necessary to achieve their clearly defined inflation target.
And in countries with a recent history of excessive monetary finance – for example, Brazil, which is still struggling to contain inflation amid political pressures for large deficit finance – that argument could be compelling.
But if the European Central Bank, the Bank of England, or the Fed could independently approve a maximum quantity of monetary finance, no erosion of their independence would inevitably follow.
Takahashi rightly sought to tighten policy once adequate output and price growth had returned, but was assassinated by militarists keen to use unconstrained monetary finance to support imperial expansion.
But Hamada’s inference that this illustrates the inherent dangers of monetary finance is not credible.
Prohibition of monetary finance cannot secure democracy or the rule of law in the face of powerful anti-democratic forces.
But disciplined and moderate monetary finance, by combating deflationary dangers, might sometimes help.
The likely alternative is not no monetary finance, but monetary finance implemented too late and in an undisciplined fashion.
Having eschewed monetary finance for too long, it now has so much public debt (about 250% of GDP) that if that debt were all monetized, excessive inflation would probably result.
De facto monetization is the inevitable result, with the Bank of Japan purchasing each month more bonds than the government issues, even while it denies that monetary finance is an acceptable policy option.
The lesson of Japan – but not only Japan – is clear: It is better to recognize the technical case for monetary finance and mitigate the political dangers than to prohibit its use entirely and pile up still greater dangers for the future.
Instead, it seemed increasingly clear that, as Milton Friedman put it, “inflation is always and everywhere a monetary phenomenon.”
If nominal demand grows faster than real potential growth, inflation is inevitable; and nominal demand growth can be constrained only through a mix of fiscal and monetary policy.
Just as determined monetary restraint 30 years ago ultimately overwhelmed cost-push pressures, an equally determined policy in the other direction could, in theory, boost nominal demand growth today.
Because deflation, like inflation, is ultimately a monetary phenomenon, fiscal and monetary weapons are the most critical means to combating it.
Likewise, the People’s Bank of China (PBOC) has provided monetary support, gradually lowering interest rates and reserve requirements.
Short-term rates have gone so low since the worldwide recession of 2001 - 1% and 2%, respectively, in the United States and the Eurozone, and practically zero in Japan - that a strengthening world economy will force central banks to tighten the monetary reins.
In the US, the two-day Federal Open Market Committee meeting on June 29-30 is likely to mark a major turning point, reversing the steady decline of the benchmark federal funds rate since Alan Greenspan began loosening monetary policy in 2001.
State institutions should deliver public goods (like defense, justice, and fiscal and monetary policy), society should deliver social goods (like culture, education, and assistance to needy people), and the market should deliver economic goods (which are connected with profits, growth, and employment).
The benefits of a monetary union based on a stable macroeconomic framework and governed by an independent central bank are manifest: the euro area has enjoyed low inflation and low interest rates for much of the last decade, a boost in trade and investment, and rapid integration of financial markets.
Second, the euro area benefits from an independent European Central Bank whose swift actions to ease liquidity constraints and coordinate monetary policy have recently helped to avert a financial meltdown.
Later, “new classical” economists like Robert Lucas and Thomas Sargent demonstrated that once people understand that inflation is being manipulated to generate market optimism, the monetary authorities’ actions lose their impact.
In July, Bernanke attempted to calm investors with remarks signaling that, amid inadequate employment gains and persistently low inflation, the Fed would not abandon monetary stimulus anytime soon.
This stance reflects the Fed’s dual mandate, according to which monetary policy targets maximum employment consistent with price stability.
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