The Fed Can Do Nothing About Market Prices That Are Always Transitory

The cost of a call in a telephone booth long ago dropped to zero. Should we give Fed officials a pat on the back for their brilliant market interventions of the ‘monetary policy’ variety on the way to this alleged ‘deflation’? It’s a clown question, obviously.

More realistically, a rapidly advancing and globalized division of labor among hands, machines, and minds led to the disappearance of telephone booths. This globalized transition from ‘can you spare a dime’ or quarter had nothing to do with central banks, and the economists in their employ.

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