08.03.2018 - Studies

John Laws exempel

by Thomas Mayer

John Law anticipated today's central bank policy of "quantitative easing" in the early 18th century. Richard Cantillon saw the weakness of Law's policy and bet against it. Law's experiment went wrong and Cantillon became rich.

For many years it has been good manners to note that monetary policy is penetrating ever deeper into "uncharted territory". They venture particularly far into this terrain with "quantitative easing". As with a new drug, one would expect it to have a beneficial effect, but could not predict exactly how the experiment would end. Therefore, a cautious approach is required, as is usual when moving into uncharted territory.

Please note: This study is available in German only.

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