Navigating Monetary Policy and Inflation

I sat down with George Selgin, economist and Senior Fellow at the Cato Institute, to explore the complex world of money, banking, and monetary policy. George explains how money evolved from primitive barter systems to the sophisticated financial networks we rely on today. He breaks down the historical role of gold, central banking, and the Federal Reserve’s influence on inflation and interest rates. George also highlights competing economic theories of money creation, laying out his case for why they're wrong. Money isn't everything in life, but understanding how it works can help you avoid falling for the false promises of politicians and pundits.

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Follow George on X (formerly Twitter): https://x.com/GeorgeSelgin

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Outline:

[0:00] Money, currency, and the money supply

[11:04] Is modern money actually debt?

[23:58] Who invented the first money?

[30:11] Use value vs. exchange value of money

[36:39] Why do certain goods become money?

[42:03] How money reshaped our communities

[58:34] What is a bank? Can banks “create money”?

[1:12:54] The special power of central banks

[1:18:53] Interest is about opportunity, risk, and inflation

[1:25:42] The Federal Reserve is the “lender of last resort”

[1:32:36] Is the Fed private or public?

[1:39:03] What happened to the gold standard in 1933?

[1:42:59] Do the owners of the Fed have real power?

[1:47:57] How does the Fed impact inflation?

[1:55:30] Explaining the Fed’s toolkit

[2:07:27] The “money multiplier” story is oversimplified

[2:12:47] What will our monetary future look like?

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Watch the video version on YouTube: https://youtu.be/mpcvBpDaMaw

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