Market Monetarism and the Crash of 2008
Thursday, February 20, 2014
Stern Center, Great Room, 7 p.m.
By focusing on nominal GDP as an indicator of both economic conditions and a target of policy, the real problem with the financial crisis of 2008 was that policymakers misdiagnosed what was occurring. Market monetarism can help us better understand the underlying nature of the 2008 crisis, along with current issues in monetary policy.
This event is sponsored by the Clarke Forum for Contemporary Issues and co-sponsored by the Department of International Business & Management.
Scott Sumner is a professor of economics at Bentley University and has taught there for the past 31 years. He earned a B.A. in economics at the University of Wisconsin and a Ph.D. in economics at the University of Chicago. Sumner’s research has been in the field of monetary economics, particularly the role of the gold standard in the Great Depression. His other research includes liquidity traps, and how monetary policy can be effective at the zero interest rate bound. Sumner’s policy work has focused on the importance of expectations, particularly policies aimed at targeting expectations in futures markets. In 1989 he proposed pegging the price of nominal GDP futures contracts. The crisis of 2008 raised issues that related to all three of his areas of research, and drew him into the public policy debate. Since early 2009 Sumner has been writing posts at TheMoneyIllusion.com.