Every five years the federal finance minister updates the "marching orders" that guide the Bank of Canada and its conduct of monetary policy. The time is right for some new thinking.
Working Canadians have been poorly served by the economic performance of the last 40 years. A new direction is needed now.
The past 18 months have seen real wages increase in Canada. These real wage gains, however, are not that surprising once we take a look at the behaviour of inflation since the crisis.
From inflation targeting to quantative easing, from stimulus to international trade, Armine Yalnizyan shares his thoughts on the, er, number-two choice for Bank of Canada governor.
Mark Carney's tenure as Governor of the Bank of Canada overlaps some challenging economy history. We are still living that history in terms of a post-recession stagnant recovery.
A report recently released by the Macdonald-Laurier Institute claims Canada does not suffer from Dutch disease. Unfortunately, the studies the authors draw on for this conclusion are riddled by it.
Inflation remains modest and should not deter the Bank of Canada from keeping interest rates low. However, even this modest inflation exceeds the small pay increases received by Canadian workers.
Many tenets of neoclassical orthodoxy have fallen by the wayside in the past 3 years, but one of the biggest dominoes is that inflation targeting should be the exclusive focus of monetary policy.
So, the 2 per cent inflation target has been renewed as it now stands. (Take that, House of Commons Finance Committee, which is holding hearings on the issue next week.)
How to reconcile what we know happened in 1920s Germany (money printing, hyperinflation), with MMT views? After all, MMT theorists tend to downplay worries about "money printing."