Monetarism and the Battle with the Global Economic Crisis

Abstract

The purpose of this article is to research and verify the hypothesis that the current crisis is the result of monetarist doctrine and it concludes that up to now the battle against the International Financial Crisis is ineffective regarding policy effects and unsatisfactory concerning methods. After a period of growth and prosperity, we are now in the final stages of a more than 30 years long era of monetarism. It is observed how the system defends itself from falling. However, at the same time, the fight against the crisis is dominated by monetarist instruments. Low evaluation of the effectiveness of this fight leads to the conclusion that it is impossible to fix the economy using the same methods that led to the crisis outbreak.After six years since the crisis outbreak the condition of the economy demonstrates the low effectiveness of dealing with the crisis and the further intensification of the crisis-factors. The end of the monetarist age signals the need to seek systemic solutions, new approaches to quality management and change the way of thinking, which seems to be necessary for the Western economy to get out of recession.