August 15, 2016

Macro Musings 19: Nick Rowe on Monetary Basics, Milton Friedman’s Thermostat, and More

Hosted by David Beckworth of the Mercatus Center, Macro Musings is a new podcast which pulls back the curtain on the important macroeconomic issues of the past, present, and future.

Nick Rowe is a professor of economics at Carleton University in Ottawa, a member of the CD Howe Institute’s Monetary Policy Council and of Carlton University’s Centre for Monetary and Financial Economics, and a popular blogger at "Worthwhile Canadian Initiative." He developed an interest in macroeconomics as he came of age in the United Kingdom during the high inflation period from the late 1960s to 1970s. Nick joins the show to discuss some of the basics of monetary economics and argues that money is the critical factor that distinguishes macroeconomics from microeconomics. He also shares his thoughts on helicopter money, which he thinks is “small beer” or not as big a deal as commentators make it out to be. Finally, David and Nick also discuss some helpful analogies Nick has used to illustrate economic concepts including “Milton Friedman’s thermostat” – how a good thermostat works like a good central bank!