Article Review 8: Simple Janet – The Monetary Android With a Broken Flash Drive

In this week’s article titled, ‘Simple Janet – The Monetary Android With a Broken Flash Drive,’ features David Stockman criticizing the actions of another economist as per usual. This time around he is attacking Janet Yellen. Janet Yellen is the head of the Federal Reserve. He believes she’s wrong about her thoughts on negative interest rates to promote economic growth. Though a bunch of things economic-wise have gone wrong, Yellen fails to report these instances and instead claims that the number of jobs being created has risen. However, Stockman says that we are at Peak Debt, along with most of the world.

Stockman uses the evidence of how household, mortgage, and credit card debt is already experiencing a negative growth without negative interest rate policy so negative interest rates would not help the situation ate all. Since the financial crises, there has actually been a display of negative growth in household debt. Stockman refers to our current situation with ZIRP, the zero interest rate policy and states that negative interest rates would only make our economy much worse. Despite this, Yellen believes it doesn’t matter that the Fed is falsely inflating equity markets. Her plan to fix the bursting bubble is to reflate it. Overall, Stockman basically bashes the Fed for their stupidity and sees a great deal of problems we may encounter if the negative interest rate policy would be implemented.