Experience has shown that ongoing financial innovation complicates the interpretation of the monetary data. This remains a substantial practical challenge – but one that must be addressed. Making the analysis of money and credit developments operational is a key area for new research.
We should, however, be particularly careful about raising tariffs at a time when costs are falling everywhere – aside from the inflationary impact, for every happy domestic businessman whose prices are raised by the imposition of tariffs on imports, we have an unhappy domestic businessman whose costs are raised by the very same tariffs, as well as unhappy consumers.