Good link. It's rare that macro/monetary comes together with a good clear writing style. What she's doing is harder than it looks. Saved.
That said, as someone who studied economics circa 2005... I think confidence in monetary theories is in long term decline.
Money supply affects X. X causes Y. But... "money supply" is hard to define. Hence M1/M2 categories and other complexities. X & Y are also hard to define. Money supply sometimes causes Y without affecting X. Hence Alden's need to distinguish between private from corporate wealth or debt. Hence her list of non-monetary deflationary causes... each one of which may be more impactful than money supply... even if we could be confident in our understanding of money supply.
We're kind of at a place where there is no useful theory. There are some very broad, almost universal theories. Print enough money and inflation will happen eventually. But, these tell us almost nothing about the margins. At the margin, we don't even know how to quantify money printing, money supply... or even inflation.
I'm not saying we shouldn't listen to economists, just that we need to realize the shades of uncertainty at play. Alden seems to have her points of interest in all the right places. Inflation is not one thing, and that's relevant. Central bankers actually matter. Lots of "outside factors" affect inflation directly, without acting on the money market directly.
Last, speaking of definitions, there's a difference between what she is trying to do (macroeconomic theory for the purpose of asset speculation) and "academic" macro. Here definition of inflation doesn't need to correspond to actual inflation in prices that people pay for stuff. It just needs to correspond to investable asset inflation.
That said, as someone who studied economics circa 2005... I think confidence in monetary theories is in long term decline.
Money supply affects X. X causes Y. But... "money supply" is hard to define. Hence M1/M2 categories and other complexities. X & Y are also hard to define. Money supply sometimes causes Y without affecting X. Hence Alden's need to distinguish between private from corporate wealth or debt. Hence her list of non-monetary deflationary causes... each one of which may be more impactful than money supply... even if we could be confident in our understanding of money supply.
We're kind of at a place where there is no useful theory. There are some very broad, almost universal theories. Print enough money and inflation will happen eventually. But, these tell us almost nothing about the margins. At the margin, we don't even know how to quantify money printing, money supply... or even inflation.
I'm not saying we shouldn't listen to economists, just that we need to realize the shades of uncertainty at play. Alden seems to have her points of interest in all the right places. Inflation is not one thing, and that's relevant. Central bankers actually matter. Lots of "outside factors" affect inflation directly, without acting on the money market directly.
Last, speaking of definitions, there's a difference between what she is trying to do (macroeconomic theory for the purpose of asset speculation) and "academic" macro. Here definition of inflation doesn't need to correspond to actual inflation in prices that people pay for stuff. It just needs to correspond to investable asset inflation.