The fact that central bank policies become ineffective in reviving the economy is not due to the liquidity trap, but because of the decline in the pool of real savings. This decline emerges due to loose monetary and fiscal policies.
In a true market — i.e., without a central bank — banks are intermediaries of real savings in their lending activities, thus promoting genuine and real economic growth.
The US dollar continues to enjoy the confidence of markets, governments, and central banks. But faith in the US dollar is weakening, and many are trying to help the process along.
Dave Smith and Jeff Deist discuss the astounding news from Trump about reducing troops in Syria and Afghanistan, and the growing push-back against neoconservative foreign policy from ordinary Americans.
