On the heels of the Fed’s annual meeting in Jackson Hole, “extraordinary” monetary policy may be the new normal. Janet Yellen refuses to raise rates for now, and Former Chair Ben Bernanke openly questions whether the Fed’s Treasury-laden balance sheet—swollen after successive rounds of QE—will ever be unwound. Real growth is flat, real incomes are stagnant, inflation is higher than the government admits, and millions of Americans still haven’t recovered from the Crash of ’08.
Is economics broken? Have we entered a new era of technocratic impotence, where mainstream economists simply have run out of monetary policy tools? Can we undo the damage caused by the Fed’s relentless attack on savers? Do most professional economists understand the role of interest rates at all? And what kind of revolution is needed to save economics as a profession?