Some of the key points of the paper: Money multiplier theory, as implemented through fractional reserve banking, has been broken in the U.S. through alternativ

Some of the key points of the paper: Money multiplier theory, as implemented through fractional reserve banking, has been broken in the U.S. through alternative instruments(e.g. money market accounts), and has not controlled bank lending policy in the last 20 years. The Fed persists in trying to make banks lend more, and has settled on taking on mortgage debt as the best means of doing so. Avoidance of the complete collapse causes homeowners to stay put, reducing labor mobility and increasing unemployment. Fed policy and bank policy are determined by their "class" in society - the Fed is politically motivated and will pursue inflation even if it ruins the economy. Bankers will accept deflation so as not to cause a collapse. Japan is alluded to; it has a strong banker class that fought against pressure to inflate. The Fed is a stronger entity than the equivalents in Japan, but bankers are still largely unresponsive to its actions. The paper concludes that a slow, deflationary economy will persist until the Fed releases the mortgage debt. (I don't really agree, but don't have specific thoughts yet.)