645. Making Money Work: Banks, Capital Theory, and the Fed’s Blind Spot with Steve H. Hanke
About this episode
Steve H. Hanke discusses the role of banks and money creation in macroeconomics, critiquing current practices and theories.
Steve H. Hanke is a Professor of Applied Economics and Founder and Co-Director of the Institute for Applied Economics, Global Health, and the Study of Business Enterprise at Johns Hopkins University in the Whiting School of Engineering. He is also the author and co-author of several books on economics. His latest title is called Making Money Work: How to Rewrite the Rules of Our Financial System. Greg and Steve discuss why macroeconomics sidelines banks and money creation. Steve argues macro should rest on the Quantity Theory of Money and Capital Theory, including “waiting” as a factor of production with interest as its price, and criticizes the profession for abandoning these foundations. He contrasts GDP with gross output and links Fisher’s MV=PT to intermediate transactions, then explains why commercial banks create money via lending while investment banks intermediate savings, and why regulation (capital and reserves) matters more than the federal funds rate. Steve critiques universal banking for siphoning capacity from deposit-taking lending, faults the Fed for ignoring broad money measures, discusses Divisia aggregates and Volcker-era measurement errors, and applies…
More episodes of unSILOed with Greg LaBlanc
- 648. Civilization’s Imbalance and Restoring the Humanities: The Divided Brain with Iain McGilchrist
- 647. What’s Missing From the Modern Education System with Susan Wise Bauer
- 646. The Economics of Life & Being Human with Pablo A. Peña
- 644. Reclaiming Joy from Screens and Ultra-Processed Foods with Michaeleen Doucleff
- 643. In a Good Place: How Built Environments Shape Agency, Wellbeing, and Behavior with Leidy Klotz
- 642. Roger Spitz on Future-Readiness: A Call to Adaptability
Explore listener stats, chart rankings, contacts and more on the unSILOed with Greg LaBlanc podcast page.