The deceleration in AD, from the deceleration in Vt, is due to the impoundment and ensconcing of time deposits, interest bearing deposits, in the payment's system. The FED eliminated Reg. Q ceilings and the FDIC rose deposit insurance from $40,000 to $100,000. Then in 2008 the FDIC raised deposit insurance to unlimited and the FED remunerated IBDDs (a Romulan Cloaking device), inducing nonbank and E-$ disintermediation.
The July 2011 demarcation in E-$ liabilities was principally due to: (1) “the FDIC formally modified the assessment base in 2011 to include all bank liabilities”, which made foreign deposits, e.g., E-$ borrowings, more expensive (never before applied assessment fees), and Basel’s additive Liquidity Coverage Ratio (LCR).
re: "The root cause of the high-misery-index 1970s was demographics, plain and simple"
False. It was due to the acceleration in velocity as measured by demand deposit turnover. Vt rose because of the monetization of time deposits, the end of gate keeping restrictions, the transition from clerical processing to electronic processing.
The deceleration in AD, from the deceleration in Vt, is due to the impoundment and ensconcing of time deposits, interest bearing deposits, in the payment's system. The FED eliminated Reg. Q ceilings and the FDIC rose deposit insurance from $40,000 to $100,000. Then in 2008 the FDIC raised deposit insurance to unlimited and the FED remunerated IBDDs (a Romulan Cloaking device), inducing nonbank and E-$ disintermediation.
The July 2011 demarcation in E-$ liabilities was principally due to: (1) “the FDIC formally modified the assessment base in 2011 to include all bank liabilities”, which made foreign deposits, e.g., E-$ borrowings, more expensive (never before applied assessment fees), and Basel’s additive Liquidity Coverage Ratio (LCR).
re: "The root cause of the high-misery-index 1970s was demographics, plain and simple"
False. It was due to the acceleration in velocity as measured by demand deposit turnover. Vt rose because of the monetization of time deposits, the end of gate keeping restrictions, the transition from clerical processing to electronic processing.
I think the better question is: can demographics drive the political reality which then drives monetary policy in subtle (and hidden) ways?
Who knows? If there are many "believers" that could come about