The argument is that, in effect, monetary policy is premised on the idea that all companies are small enough to be subject to market pressures, and that interest rate policies can impose changes on markets that will, because of those market pressures, be transmitted into both corporate and personal behaviour.
However, the assumptions does not hold true, they suggest, when there are companies of exceptional size.
The argument is that some companies are too large to be influenced by monetary policy.
Hmm, well, maybe, but let’s run with it.
So, the man who says that monetary policy is over, that fiscal policy is the only tool we can or should use. Now he says that we’ve got to use fiscal policy to tax companies back to the size where monetary policy works on them. That monetary policy that we shouldn’t and cannot effectively use anyway.
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