LSU’s Joseph Mason Reveals How Monetary Policy Impacts Oil Price, Small Business
BATON ROUGE –Hermann Moyse, Jr./Louisiana Bankers Association Endowed Chair of Banking and Russel B. Long Professor of Finance at LSU Joseph Mason has released an analysis that argues that the government can take a course of action that will demonstrably reduce gasoline prices. Mason’s study, “The Perverse Dynamics of Long-Term Low Interest Rates: Evidence from Oil Prices,” was sponsored by the Small Business & Entrepreneurship Council.
Specifically, Mason’s study reveals how the Federal Reserve’s commitment to near-zero interest rates affects commodity pricing, including gasoline reaching nearly $4 per gallon, and impacts American entrepreneurs.
“The Fed’s inflationary bias fuels energy costs,” Mason said. “While the White House has backed the Fed’s pursuance of soft monetary policy, it has allowed three years to pass without creating multifaceted energy policy. And consumers are being hit with this one-two punch at the gas pump.”
Mason’s study, which was released May 16, can be read in full at http://www.sbecouncil.org/uploads/SBEC%20Mason%20Monetary%20Policy%20Final%20Paper.pdf.