Carnell Knowledge

There is still a lot of chatter about the pandemic leading to stagflation. 

In this episode, I argue that apart from a short-term and perhaps temporary rise in the price level, we aren't likely to see any sort of lasting "flation"... and if you are loaded up with debt, that might not be a good outcome.

When Central Banks tell us, it's all fine, we still have forward guidance, it's time to worry - it means they really have nothing left

Some eminent economists think the answer to weak growth and low inflation, is substantially negative interest rates. With the application of a little common sense, and a minor tweak to textbook economics, such arguments can be easily trashed. 

Listen to this podcast for some easy to follow explanation of why the boffins have got it wrong, and why a return to modest positive rates may be just what the economy actually needs. 

Some eminent economists think that substantially negative interest rates are the answer to persistently weak economic growth and low inflation. But it isn't hard to argue that not only might this do no good, it could actively do harm to the economy. 

In this podcast, I shred the argument for negative rates, and propose a common-sense based alternative, using easy to follow examples and analogies, and a hefty does of irreverence. 

Some people predicted that this Pandemic would lead to stagflation. This podcast takes their arguments, shreds them, and then laments the fact that they were wrong, as a spot of stagflation wouldn't actually be such a bad outcome after all!

Central Bankers think that they can get additional firepower to exhausted monetary tools, just by telling us they won't hike rates for ages. This is deluded and potentially dangerous.

In these difficult times, are negative interest rates are a useful policy option for central banks, or alternatively dangerous nonsense? 

Well, clearly it's dangerous nonsense! 

Listen here to understand why. 

Why we shouldn't listen to central bank guidance, and why a "strategy change" to allow inflation to "run a little hot" is just hot air

To which the basic answer is, YES!

Episode 3 - Part 1: How some central relationships in economics have changed, and what that means for policymakers