The Julia La Roche Show, Released on 7/18/24

Steve H. Hanke, professor of applied economics at Johns Hopkins University and the founder and co-director of the Institute for Applied Economics, Global Health, and the Study of Business Enterprise, joins Julia La Roche on episode 81 for a wide-ranging conversation on the economy. Three years ago, using the quantity theory of money — which links asset prices, economic activity and inflation to changes in the money supply—Professor Hanke accurately predicted that inflation would be persistent and rise to the highest levels in a generation between 6 to 9%. Inflation topped out at 9.1%. And he expects inflation will fall to his expected range of 2.5-3% by the end of the year. He also expects that we’ll enter a recession later this year or early next year.

00:00 Introduction and welcome Professor Hanke
01:05 Big picture, macro view, Quantity Theory of Money
06:20 Inflation headed to 2.5-3% zone by year-end, sees recession ahead
07:40 Grading the Federal Reserve’s policies, they get an ‘F’
12:40 How the money supply works
16:21 Inflation below 2%?
17:30 Debt and deficit
21:52 Need for a Constitutional amendment to control government spending
23:48 End game if we don’t address the debt situation
24:44 A fiscal illusion

Steve Hanke is an American applied economist at the Johns Hopkins University in Baltimore, Maryland. He is also a senior fellow and director of the Troubled Currencies Project at the libertarian Cato Institute in Washington, DC, and co-director of the Johns Hopkins University’s Institute for Applied Economics, Global Health, and the Study of Business Enterprise in Baltimore, Maryland. Hanke is known for his work as a currency reformer in emerging-market countries. He was a senior economist with President Ronald Reagan’s Council of Economic Advisers from 1981 to 1982, and has served as an adviser to heads of state in countries throughout Asia, South America, Europe, and the Middle East. He is also known for his work on currency boards, dollarization, hyperinflation, water pricing and demand, benefit-cost analysis, privatization, and other topics in applied economics. Hanke has written extensively as a columnist for Forbes magazine and other publications. He is also a currency and commodity trader.

  economy, inflation, markets, recession, steve hanke, stocks