Barnett and Block (forthcoming) claim that Bagus and Howden (2012b) support indirectly the concept of market failure. In this paper we show that maturity mismatching in an unhampered market may imply entrepreneurial error but cannot be considered a market failure. We demonstrate why...

In this article, we aim to develop a political economy of mass hysteria. Using the background of COVID-19, we study past mass hysteria. Negative information which is spread through mass media repetitively can affect public health negatively in the form of nocebo effects and mass hysteria. We...

Recently, attention has been drawn to compositional changes in the Federal Reserve System's asset holdings. While much attention has been drawn to the deterioration of the balance sheet of the Fed in the face of the current crisis, an analysis of the balance sheet policies of the Eurosystem is...

The balance sheet developments of the Federal Reserve System have received increased attention during recent events. The Fed has expanded its balance sheet and also changed its composition in order to support the financial system. As a consequence the average quality of the assets have, on...

Barnett and Block (2008) attack the heart of modern banking by claiming that the practice of borrowing short and lending long is illicit. While their claim of illegitimacy concerning fractional reserve banking can be defended, their justification lacks substance. Their claim is herein...

We explore several unaddressed issues in George Selgin’s (1988) claim that the best monetary system to maintain monetary equilibrium is a fractional reserve free banking one. The claim that adverse clearing balances would limit credit expansion in a fractional reserve free banking system is...

Recognizing different types of savings allows for a more fruitful analysis of the business cycle. Sustainable investment activities must be financed by an equivalent amount of savings, both in length of availability and quantity. Upward sloping yield curves are a feature of the unhampered...

We reassess monetary equilibrium theory by focusing on its foundation – price stickiness – and answer several ancillary questions. Prices are sticky at times. Contra monetary equilibrium theorists, this is not a reason to advocate an issuance of fiduciary media to counteract the effects of a...

We reassess monetary equilibrium theory by focusing on its foundation – price stickiness – and answer several ancillary questions. Prices are sticky at times. Contra monetary equilibrium theorists, this is not a reason to advocate an issuance of fiduciary media to counteract the effects of a...

Barnett and Block (2011) argue that one cannot distinguish between deposits and loans due to the continuum problem of maturities and because future goods do not exist – both essential characteristics that distinguish deposit from loan contracts. In a similar way but leading to opposite...