Minerd: The Fed Is 'Trying to Be Too Cute' With Policy

The video discusses the current market turmoil and the Federal Reserve's role in managing inflation. It highlights Milton Friedman's view that inflation is a monetary phenomenon and suggests controlling the money supply and balance sheet as effective strategies. The Fed's current approach of managing interest rates is critiqued as abandoning monetary orthodoxy. Historical examples from the 1940s are used to illustrate successful inflation control. The video concludes by warning of potential risks if the Fed continues its current strategies, drawing parallels to past incidents in 2018.

What is the primary tool mentioned for controlling inflation according to Milton Friedman?

• Taxation policies

• Money supply control

• Government spending

• Interest rate adjustments

What does the Fed currently believe it can manage to control inflation?

• Money supply

• Interest rates

• Government expenditure

• Tax rates

How does the Fed's current approach differ from traditional monetary orthodoxy?

• It emphasizes interest rate management

• It focuses on fiscal policy

• It relies on international trade

• It prioritizes tax cuts

What historical period is referenced to illustrate the effects of not expanding the balance sheet?

• The 1940s

• The 1960s

• The 1920s

• The 1980s

What potential risk does the Fed face by adjusting short-term rates and the balance sheet?

• Increased employment

• Economic growth

• Market stability

• An economic accident