It is three months since I reported on progress with the book. Three busy and sometimes exciting months, including a three week road trip to central and northern Australia – progressing from Melbourne to Wilpena Pound, William Creek (including a flight over Lake Ayre and the ‘painted hills’), Daly Waters, Katherine Gorge, Uluru, Alice Springs, Kakadu and finally Darwin. Interesting ‘real Australians’ to meet and stunning landscapes to experience, with a near daily route march/rock climb/etc organised by she who must be obeyed.

Before this break, I spoke at Ballarat Rotary, at several club affairs in Melbourne, at the History of Economic Thought Society Australia (HETSA) conference and recorded an interview with Alan Kohler to be played on Qantas flights, I think in October.

My talk at the HETSA conference started as follows: ‘It is an honour to be speaking at this meeting of the History of Economic Thought Society Australia (HETSA) at RMIT University. My recent visit to the economists of ANU was like entering a Lion’s den, and this feels a bit like visiting a Tiger’s lair.

My circulated paper is based on Chapter 11 of Great Crises of Capitalism and is titled ‘Great Crises of Economics – what are the lessons.?’ Here is a link to the full presentation.

And here is a link to the HETSA paper itself.

To continue the introduction: ‘My perspective is that of a policy advisor and ‘how does the economy work’ is a vital matter for such a person. I was a serious policy oriented researcher for 10 years and a real live policy advisor for another ten. You might see me as a Rip Van Winkle figure, but for the past 20 years I have not been asleep, merely distracted from time to time’.

While we were in Central Australia the Fairfax press published lists of what Australia’s leading politicians were reading, and we were delighted to learn that Great Crises was on Tony Abbott’s list. Coincidentally or not, I have begun to receive invitations to speak from conservatives generally and the major branches of the Economic Society of Australia.

In the immediate future I shall speak at
• The Economic Society, Vic branch, 12.30 RBA, 20 September
• The Economic society, NSW branch, Cockle Bay, 23 September
• Royal Melbourne Gold Club, 9 October.
• Melbourne Rotary, 12 October.
• Liberal Party conference, 15 October, tbc

There is also the launch of the e-book version of Great Crises, following a fine dinner at the Celtic Club in Melbourne on 27 September. The e-book is going to be launched by the Hon Andrew Robb under the elegant Chairpersonship of Miranda Kirily.

Register here.

At the same time, I am commencing a book on Australia’s globally significent mining industry with the working title Buried Treasure – forging Australia’s future.

Breaking news. Connor Court recently received an urgent request from its American strategic partner for the manuscript, so we are awaiting news of publication there. Oprah, here we come! The book opens by saying: ‘The world could still experience a Great Depression as a result of the global financial Crisis of 2007-08’. With the American (and Eurozone) economic news again getting gloomier by the day, perhaps LittleBrown found itself with a gap in its list.

Every presentation, if one considers the audience, leads one to vary the matters to be emphasised.

This launch took place in a Christian bookshop, Portico, owned by Bill and Christine Cannon. Tony Abbott is that rare politician who is known for his well considered morality – not to everyone’s taste, of course, but greatly admired in our family.

As I browsed before the beginning of the launch event, my mind turned to matters of ethics and morality.

My book rues the greed of modern financiers, and the boneheaded greed of the bankers of Wall Street in particular.

But this character flaw is a common one and not usually mentioned by economists in their diagnosis of the weaknesses of capitalism.

It occurred to me that the great philosopher of capitalism, Adam Smith, pointed out in The Wealth of Nations that it is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.

This seems to endorse naked self-interest, but Smith’s other great book, The Theory of Moral Sentiments, written well before The Wealth of Nations, said men (especially those of the ‘middling’ kind) were in his time concerned about the ‘good opinion of their neighbours and equals’.

Now there is far less concern for the good opinion of one’s neighbours and peers now, especially among the titans of Wall Street and Martin Place. This lack is a serious threat to capitalism and somehow needs to be reinstated.

Along with the closely related matter of rampant consumerism, and lack of monetary policy discipline leading to inflation, this became my theme for the event.

Naturally I also discussed the more technical matters, chiefly inconsistent policies over time, that have featured more heavily in the book, and in previous presentations.

Tony Abbot spoke first and made some acute observations about the book and in particular my ability to tell the story in an engaging and understandable manner.

I replied as the presentation linked here records. http://greatcrisesofcapitalism.com/presentations/sydney-launch/

When it came time to answer questions I rather cheekily (I later reflected) invited Tony Abbott to join me at the microphone, an invitation that he unhesitatingly accepted.

What followed was an enlightening economics tutorial, perhaps laced with more humour that such events usually contain. Anyone who thinks Tony Abbott is not interested in economics, or lacks knowledge, is just plain wrong.

We ended the event each signing books, my Great Crises of Capitalism and his Battlelines. So far as I could tell, everyone who queued for a signature had brought one copy of each book.

My week ‘on the road’ was stimulating and boosted book sales to a noticable degree. Tuesday in Brisbane included an Economic Society meeting hosted at Queensland Investment Corporation by CEO Doug McTaggart.

Highlight was the number of young people present, which shows the Queensland branch of the society is doing some things right. The conversation was lively and we had some laughs. Marvellous Melbourne’s Astounding property boom and bust generated considerable interest. Indeed, back in Melbourne on the weekend there were scary ‘the sky is falling’ stories about house price falls (gasp!) in the better suburbs.

Then on Wednesday I shared the stage at the CRC Association conference with a man from the OECD, consultant Thomas Barlow and the Hon Senator Mason. I spoke about the massive innovation – new inventions, new lands being developed (including the USA and Australia) and new innovations in new lands (like when to plant crops in the Southern hemisphere.), all held together by the gold standard whose demise in the twentirth century has caused great asset and other types of inflation. I waxed a bit political, unavoidable really as the CRC Program is an iconic Labor government, but … John Howard gave more money to the CRC program than Prime ministers Rudd & Gillard. A Vice Chancellor commented on the budget cuts but nevertheless said that, despite this, the Minister for Innovation, Kim Carr, is really supportive of the CRC Program. Henry’s daily blog felt constrained to lament the death of ‘evidence-based policy’ under this government. Here is a link.
http://www.henrythornton.com/blog.asp?blog_id=2071

Then last Thursday I arrived at University House on the lovely ANU campus. It was a perfect autumn day and there was time to wander around thinking what if thoughts of whether turning down the chance to come here to work all those years ago was sensible.

A lively lunch with two professors and two bright graduate students set me up for the seminar late in the day.

Bob Gregory of ‘Gregory thesis’ fame asked a key question about Henry’s plan for a global central bank with a mandate to provide a non-inflationary monetary standard for all countries. ‘If the EU cannot hold it together’, Bob asked, ‘how could a global version possibly work?’

Naturally I had to concede that this was a good question. My answer was that such an entity would allow individual nations to revalue or devalue in relation to the global standard. Failure to allow this was a fatal flaw in the EU system.

If important and responsible nations signed up – China, India, USA, Germany (or the non-inflationary core of the disintegrating EU), Japan and Australia – the plan would be viable and the success of the countries that did sign up would over time encourage others to join.

Another line of debate concerned ‘Taylor rules’, and whether a series of possibly ‘more optimal’ Taylor rules might be a viable alternative to a global system. Again I conceded that this would probably be preferable to the current system, whose chief weakness was (I asserted) the irresponsible monetary policy being imposed on the world by the USA.

I eventually settled on a bet with a young professor recently arrived from the USA – a great fan of Ben Bernanke – on whether in ten years Bernanke’s policy would be hailed as a triumph or damned as a disaster.

A visitor from the House of Reps wanted to know the implications of my analysis for individuals. This was not a Dorothy Dixer, though it could have been as this is an important part of the book. I said individuals or families had to devote considerable resource to analysing, understanding and playing the large swings in asset values if they wished to build and retain wealth. More on this in Chapter 12, ladies and gents.

A non-economist, non-historian during the drinks after the seminar was worried about the lack of accountability of ‘independent’ national central banks, and ergo the greater lack in a supra-national body.

Again one had to concede it was a good question, and we suggested remedies such as a clear mandate and holding the employees of the Supra-national central bank to account for performance against that mandate.

Dinner was at an old mate’s place and touched on related matters, including Glenn Stevens’ monstrous one million dollar plus salary.

‘It was thrust upon him by the RBA’s remuneration committee’ one knowledgable fellow remarked, ‘but he would have been wise to refuse the largesse, as his predecessor Bernie Fraser did’.

All being monetery experts, the group rapidly reached a consensus that what the nation needed was an ‘expert’ board for the RBA, as in the Fed, the Bank of England and the Bundesbank, but minus the Secretary of the Treasury who is conflicted by his role as a servant of the Treasurer. The business members of the board are also conflicted, as previously argued by Henry. It remains baffling to me that a retailer can ever argue for a tough monetary policy, effecting as it must the value of his shares in the retail enterprise.

I asked when such a reform might be implemented. ‘After the next big stuff-up’ was the reply. Here is a link to Henry Thornton’s columns on Australia’s monetary policy. The best (stuffups) are yet to come. http://www.henrythornton.com/article.asp?article_id=5071

Last week ended with a bang. Principal event was a Quadrant dinner in Sydney at which people such as philosopher David Armstrong, former Secretary of Treasury (and sometime National Party Senator) John Stone, historian Keith Windshuttle (Quadrant editor) and other Quadrant members ran ran their slide rules over the book, which emerged in fine shape.

Then we attended Sky News for a longish interview by Carson Scott which we expect will be available to view via a link before too long.

Next big event is an Economic Society meeting hosted by the Queensland Investment Corporation in Brisbane on the evening of 17 May.

Then at the end of that week I shall undergo scrutiny at the hands of the economists at ANU, surely the toughest test yet, followed on Saturday morning by our first bookshop event.

Visit the ‘Events’ page of this website and register if you would like to attend either event or indeed others planned for all state capitals in coming weeks and months.

Last night saw Henry at Brighton Rotary, the cheeriest group of fellows it has ever been his privilege to address.

As usual, question time was the best part of the evening, and the Brighton Rotarians were in fine fettle.

If one had to summarise, their concerns were about the property bubble, the share market and the monetary policy standoff between the USA and China.

Earlier in the day, Henry met one of the nation’s finest financial planners, who asserted that the theme of Great Crises about investment theory and practice was (a) original; and (b) made great sense to him.

A student in another discussion said Great Crises is already in the libraries of Melbourne University and Deakin University.

So far, the only holdouts are the gnomes of Martin Place, but we live in hope.

Today Deakin, tomorrow the world!

We are having fun, and selling books.

In pursuit of this noble objective, Henry has learned how to tweet.

What a revelation. Kevin Rudd, tweeting like a canary.

Barack Obama, the man who made history in e-voting.  his latest tweet: ‘At a time when the economy is still coming out of an extraordinarily deep recession, it would be inexcusable not to get this budget done’.

Malcolm Turnbull drawing attention to his latest speech with a good paper on Australia’s need for a new sovereign wealth fund.

Henry of course is tweeting to draw the younger generation’s (including President Obama) attention to Great Crises of Capitalism.  With major booksellers having their own Great Crisis, we need all the help we can get.  Loyal readers, get out there and vote with your wallets. I promise you will enjoy the book, and your children or grandchildren will gain great value from it.

Sydney supporters, soon there will be grand events in your home town.  Register here if you would like an invitation.  In May, the caravan moves to Brisbane and then we make a brief foray to Canberra, where Henry’s editor will enter the lion’s den that is an ANU seminar.

The RBA gov’ner, Australia’s latest million dollar man, has declined our invitation to host an event, even though we offered to donate the profit from such an event to his favourite charity.

We are awaiting our generous invitation to provide a one-on-one briefing.  Probably will be  either ignored (the usual lofty response to Henry’s offers of help) or else passed down to the fourth assistant Secretary but, if it is, we’ll be there!

You may find all this heavy PR slightly distasteful, gentle readers.

As Peter Beattie pioneered so well, we offer humble apologies. But, as in other realms, Henry’s editor is determined not to die wondering.

I am a bit late reporting on our grand Melbourne launch as I got swamped with things to do immediately afterwards.

In summary, it was great fun and we sold a lot of books.  Better still, those who did not buy books mostly came with copies for me to sign.

Peter Costello was controversial, in particular failing to accept my plan for an independent global central bank.  National central banks were far from perfect, he said, and a global one would be totally unacceptable.

His opposition was somewhat modified when I said in reply that I proposed putting him in charge with me as the chief economist and (more seriously) that my plan was to have this institution issue some sort of base money at a steady (non-inflationary) rate of 5 % per annum.

Individual nations would be allowed to choose whether to link their currencies to this non-inflationary ‘base money’ but if they did they would be able to keep inflation under control or have their own inflation and a depreciating currency.

In fact, the more I think about this idea (and debate it with my son David) the better it seems, allowing as it would the old libertarian plan for ‘competitive monies’ to flourish with a stable, well understood anchor underpinning it.

The rest of my talk covered the inconsistent and panicked response to the Global Financial Crisis, thanks to all the people who had helped with the project and a summary of the policy changes needed to reduce the risk (which I think is real) of accelerating financial instability followed by another Great Depression. The notes I had prepared in advance are linked here (NB still to come), and cover these points

Peter Costello noted that I am a hawk on inflation and Henry Thornton is a ‘super-hawk’.  I noted that all successful writers are schizophrenic to a degree, and I had put two on my contending personas on the cover.

This occasion I say without false modesty was probably the best seminar on macroeconomic policy held in Australia for several years, but then the local universities do not go in for much of that subject.

I am busy trying to get onto the seminar program at some of Australia’s leading universities, to give them a chance to pick my arguments apart.  (I can be contacted at peterdjonson@gmail.com)

Copies of the book have been sent to old friends among the world’s leading economists and I hope to go overseas for some similar events later in the year.

I conclude now as I did at the launch: ‘Buy early and buy often, you will find many people who will enjoy Great Crises of Capitalism’.

The US Fed and its queue of acolytes says, in true Aussie style, says ‘she’ll be right’ on global inflation, as reportedtoday by Michael Stutchbury.

‘The Wall Street Journal backs Sarah Palin for attacking Bernanke’s moves to “dump more dollars on to the market”. By financing Washington’s budget profligacy, the action looks suspiciously Keynesian. Yet followers of monetarist economist Milton Friedman reckon Bernanke is doing the right thing’.

I claim to be a ‘follower’ of Milton Friedman too, and I think Bernanke is wrong.  The world has changed in certain specific ways since Milton Friedman proposed his simplum dictum that ‘inflation is always and everywhere a monetary phenomonon.

Milton Friedman popularised a very simple one good, one asset (money) model of a closed economy.  This can be summarised in the famous ‘quantity theory’ equation relating the supply of money, its ‘velocity of circulation’ (how often each unit of money is turned over), the price of the single good and  its quantity.  This equation is best understood as a statement of long-term equilibrium. Allowing for variations in velocity of circulation and in the production of the single good during the adjustment process, the statements in the preceding paragraph hold in the long run when velocity and production have returned to their assumed steady state levels (or rates of growth).

In the late 1990s and early 2000s, a major change to the structure of global capitalism began to be important.  The emerging economic superstates of China and India began to influence the western nations by their provision of cheap goods.  This requires an obvious application of a two-good, one asset (money) model.   In the world of ‘dominant China’, expanding the global money supply might not raise the prices of manufactured goods charged by China at all, or the relevant adjustment might take many years.  With manufactured prices fixed, presumably the prices of other goods would be the main item to adjust, meaning goods not imported from China.  In countries other than China, non-traded goods would experience inflation until a new equilibrium was established.

If we introduce a second asset, call it ‘bonds’, or ‘shares’, or ‘non-monetary capital’, its price will also rise in a world where the manufacturing goods price is fixed and money expands.  Now we have the possibility of non-monetary asset inflation.  In a world of loose monetary policy there will be both asset and non-traded product inflation. 

In the real world there are many countries, almost all producing their own money, many, many products and assets other than money for each country, and there are degrees of flexibility between the currencies of each nation. If the money supply of the dominant economy (still that of the USA) whose money serves as a global currency is expanded this will make the prices of non-money assets and non-traded good rise. Ultimately, of course, China’s manufacturing prices need to rise also, or China’s currency has to rise, but at a time of great structural development of China this development may take years if not decades.

Whether, with manufacturing prices fixed, non-traded goods inflation or non-money asset inflation rises more in response to increasing US money is an empirical matter.  Suppose, however, that the USA suffers a domestic recession so that non-traded goods inflation is low or zero.  Then rising money supply may only increase non-money asset prices.

When analysts write of global ‘imbalances’ they are usually writing about an incomplete adjustment in which one country or group of countries have an external deficit (or a falling exchange rate), and another country has an external surplus (or a rising exchange rate) with incomplete price adjustment.  The great modern example has the USA and other developed economies in deficit and China and similar nations in surplus.

My point is that, if prices of a great many goods and services are held down by structural change or by effects of recession or depression, asset inflation will take the place of product inflation in response to expansion of money.   This is part of the story of the global economy in the two thousands.  Since China did not allow its exchange rate to float upwards, eventually it began to suffer goods inflation and global asset inflation lost some of its strength, and became for a time severe asset deflation.  Asset deflation was greatly reinforced by the financial sector gridlock when the US government declined to bail out Lehman Brothers, creating a ‘torrent of mistrust’ among bankers globally. Then the US Fed stepped in and restored monetary expansion and this has fuelled real recovery in the USA (where severe recession holds down US goods and services inflation), asset inflation generally and goods and services inflation in China and other booming nations.

The US would be far better off not printing excess money.  A standard response to low goods and services inflation and high unemployment would suggest the need for easy money.  But cash rates near zero plus ‘quantitative easing’ amounts to excessively easy money, and there is a similar dangerous tendency in the Eurozone.

This attempt to explain how the world of monetary economics works now was included in my latest article designed to help Glenn Stevens and the Reserve Bank board get Australian monetary policy more right than it has, and that requires an understanding of a complex, post-Friedmanite world.

All this is explained at great length and in historial context in Great Crises of Capitalism.

This book is being launched tonight by the Honourable Peter Costello, AC.  Anyone who is keen to attend can register interest in doing so (or buy the book) at this website – simply click on ‘Events’ button.

RBA Assistant-governor (Financial System) Malcolm Edey has today released a contribution to an international forum, Beyond Basel III, apparently being held in Sydney.  (This suggests a new Star Wars epic and, when one learns Basel III will take 8 years to introduce, and that Basel II failed to prevent the Global Financial Crisis, the analogy strengthens.)

Here is a link. http://www.rba.gov.au/speeches/2011/sp-ag-240311.html

I must however thank Malcolm Edey and his colleagues for such a crisp presentation of several matters covered in the ‘solution’ part of Great Crises of Capitalism.

Under the heading ‘what went wrong’ Edey says:

‘This isn’t the occasion to give a detailed account of what caused the financial crisis. But regulators around the world drew a number of important lessons from it:

•banking systems needed more capital, and better quality capital, to withstand losses;
•they needed to be made more robust to liquidity risk;
•loan underwriting standards needed to be improved;
•governance arrangements for banks and financial regulators needed to be improved;
•various forms of conflict of interest needed to be eliminated or better managed. Examples of that included the originate-and-distribute lending model that went seriously off-track in some countries, and the role of rating agencies in advising on structured securities. It also included badly structured remuneration practices in the industry;
•and there needed to be more scope for regulatory regimes to act against the build-up of financial excess.

He adds that ‘Not all of these are matters for the Basel Committee. There are a number of different international bodies working on these things in their different spheres of influence, including the G-20, the Financial Stability Board and the international insurance and securities regulators. But since this is a conference about Basel III, I’ll focus mainly on the work of the Basel Committee’.

One glaring omission is what is to be done about the culture of rampant greed and  predatory attitude to customers that has flourished and is still alive and well.  The movie Inside Job will provide a nice top up on this matter, and Great Crises provides comcrete suggestions.

Edey lists some recommendations to deal with the above list of causes and comments that ‘there is a lot of work coming from the international regulatory bodies that’s still to be completed. By that, I mean work that groups like the Basel Committee have started but not yet finished, and also areas where the Australian regulators have work to do in determining our response to the new international standards’. 

He also notes that the Basel II ‘reforms’ introduced in 2008 failed to prevent the Global Financial Crisis.  I have yet to hear of one regulator who lost his job because of this, but I guess job security is what global econocrats mainly play for.

Remaining matters discussed in some detail include ‘The Liquidity Standard’, ‘The Counter-cyclical Capital Buffer’, ‘Systemically Important Banks’, ‘Is There Too Much Internationalisation?’ and ‘Supervision and Lending Standards’.  

Mr Edey’s ‘Endpiece’ touches on the RBA’s Financial Stability Report released today. (Here is a link 

http://www.rba.gov.au/publications/fsr/index.html)

In summary, and acknowledging the various recent  adverse events and ongoing risks and uncertainties: ‘Australian banks are in good shape, and they came through the crisis profitable and well capitalised. They have strengthened their liquidity positions and their use of deposit funding. Australian businesses have reduced their gearing. Households have raised their saving rates.

Looking ahead: ‘… it seems unlikely that we’ll be going back to the days of consistent double-digit growth in credit that we saw in the pre-crisis years. That growth was driven in part by factors that can’t be repeated – the deregulation of the financial system in the 1980s, and the transition to low inflation in the 1990s. In the post-crisis environment, borrowers and investors are more cautious than they were, both at home and abroad. That’s likely to mean less demand for leverage and less growth in private balance sheets, even when the economy itself is growing strongly. If those trends continue, I think it will be good for financial stability, but it will also mean that our lending institutions have to get used to lower rates of expansion than were typical in the pre-crisis years’.

No doubt there will be more prudent behaviour by most individuals, companies and banks in the next few years, perhaps even for a decade or two – allowing the new rules to be cemented in place.

But the lesson of history is that unsustainable booms recur, and in the past thirty or forty years asset booms and busts have been occurring more often and with greater volatility.

What a pity that our international econocrats have not (so far as we know) squarly faced the issue of the poor culture that is a prime cause of this dangerous and repetitive set of events.

Those who do not study history …

Henry at the weekend saw a wonderful documentary film, Inside Job, that tells the story about as well as he can imagine.  Our review is here.

http://www.henrythornton.com/article.asp?article_id=6237

The film notes toward the end the weakness of the US reform package, and neither the film-maker nor the many Americans they interviewed was capable of suggesting a stronger line.

Henry’s book, Great Crises of Capitalism, includes a set of recommendations on this matter, including sensible remuneration guidelines that corral bonuses until after retirement (to encourage a long term approach to running a business) and allows clawback when there are losses (so that financial services staff cannot simply gain from the profits they help to make and socialise their losses).

But the world also needs adequate asset ratios, asset ratios that flex upward when a lending boom gets underway, the return of the Glass-Steagall Act to enforce separation of investment banking from traditional commercial banking, perhaps other curbs on the size of financial service firms and a new approach to global monetary policy.  Ironically, on the latter point, China seems far more on the ball than the mighty USA, an issue which, with the US dollar as de facto global currency, America is deeply conflicted

All will be revealed soon at book launches throughout the country, beginning in Melbourne on 31 March.

Register here (see link below) if you would like to attend a book launch in the city of your choice.

http://greatcrisesofcapitalism.com/events/

IMF Managing Director Dominique Strauss-Kahn said recently that now was the right time to take stock and tackle some “profound questions about the pre-crisis consensus on macroeconomic policies.”

The March 7-8 conference aimed to take stock of the policy questions posed by the crisis, and promote a discussion about the answers and new policy approaches for the post-crisis era.

Olivier Blanchard, IMF Chief Economist, set the scene with a pre-conference Blog on the pre-crisis framework for monetary policy. His account of the “elegant and conceptually simple” pre-crisis framework was advertised as being much like a two minute refresher course for a generation of economists.

He pointed to key aspects of the old framework that no longer hold post-crisis, including the pre-crisis convergence on a “beautiful construction” of a single monetary policy target—low and stable inflation—and a single policy instrument—the central bank’s policy rate. “Beauty is not synonymous with truth,” Blanchard lamented during the conference. On the other hand, as someone might have said, a beautiful theory is more likely to be true than an ugly, complicated theory.

He added that previously “financial regulation was outside the macroeconomic policy framework [and] … fiscal policy had a limited role at best, at least in the short run.” Splitting financial regulatory agencies from central banks is just one mistake leading to this result.

The distinguished panel of economists present agreed they would be busy for years to come sorting out a better system. The crisis “breathed new life into the long-standing debate on whether the interest rate rule, implicit or explicit, should be extended to deal with asset prices,” said Strauss-Kahn. In addition to inflation, “the crisis has added a number of [policy] targets to the list, from leverage to measures of systemic risk,” he added.

Going into the conference, Blanchard also put forward some ideas to guide a re-examination of this framework, including on economic imbalances, interest rates, fiscal policy, capital flows, the international monetary system, and financial safety nets. There is a conference website, videos of each session and the capacity to comment in 124 characters.

My recent book, Great Crises of Capitalism, by some strange coincidence, covers the same ground. The IMF says it wants to stimulate debate on these great questions and this book makes a modest contribution. So naturally I left a brief comment on the conference website, and the following article posted in On Line Opinion provides a more detailed vision. Naturally I have sent a copy of the book to Mr. Blanchard at the IMF and I shall look forward to his response.

The elevator pitch? ‘I have serious concerns about how monetary policy is being practiced. Too much experimental “discretion”, too little use of stable, well understood rules’. More on this site.

A version of this blog with links to the IMF sites is available here.