Bubble Poppers: Monetary Policy and the Myth of ‘Bubbles’ in Asset Prices
CIS has released my Policy Monograph, Bubble Poppers: Monetary Policy and the Myth of ‘Bubbles’ in Asset Prices. The text was finalised before Greenspan published a defence of his record in the WSJ, but takes a similar position to the former Fed Chair.
The monograph is partly devoted to debunking the concept of a ‘bubble’ in asset prices. It argues that if the idea of ‘bubbles’ in asset prices cannot be given analytical or empirical substance, then monetary policy should not attempt to actively manage asset price cycles.
There is a shorter version in the latest issue of Policy and an even shorter version in today’s Age.
posted on 18 March 2009 by skirchner in Economics, Financial Markets, Monetary Policy
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