Insights from a 25-Year Monetary Policy Experiment

The year 2026 marks the 40th anniversary of the Levy Institute’s founding, and this event inaugurates a broader series of programs commemorating this significant milestone.

Veteran central bank watcher, Paul Sheard, will share his insights about Quantitative Easing as March marks a quarter of a century since the Bank of Japan launched this new form of monetary policy easing. Initially, a curiosity emanating from deflation-ridden Japan, QE was embraced big time by the Federal Reserve and other major central banks during the Global Financial Crisis and then again, on an even bigger scale, during the pandemic. Sheard will explain what QE is and how it works, and cast light on the confusions and controversies that surround it. He will explain why QT (Quantitative Tightening) gets less attention than QE, and why QE, together with an obscure legal change (the Fed and other central banks being able to pay interest on reserves), has changed monetary policy-making forever.

Dr. Paul Sheard, a noted Australian American economist and policy-watcher based in New York, is the author of the Wall Street Journal bestselling business book, The Power of Money: How Governments and Banks Create Money and Help Us All Prosper (Matt Holt Books), which has been published in Chinese, Japanese, Korean and Portuguese. Known for his ability to see the forest and the trees, Sheard speaks frequently on economic and policy issues at events around the world and in the media.

Sheard cut his teeth as a markets economist in Tokyo covering Japan’s “lost decades” and, as Lehman Brothers’ chief economist in New York, had a front-row seat at the global financial crisis. Most recently Research Fellow and Senior Fellow at Harvard Kennedy School and before that Vice Chairman of S&P Global, Sheard was global chief economist at S&P Global, at Standard & Poor’s Rating Services and at Nomura Securities, and was Japan Strategist and Head of Japan Equity Investments at Baring Asset Management. Earlier, he was Associate Professor of Economics at Osaka University, Lecturer in Economics at the Australian National University (ANU), Visiting Assistant Professor of Economics at Stanford University, and Visting Foreign Scholar at the Bank of Japan.

Sheard has been a member of several World Economic Forum expert councils. He was appointed by two prime ministers to serve on advisory committees of the Japanese Government and was a member of the oversight board of the Japanese Government’s Research Institute of Economy, Trade and Industry. He was a non-executive director of ORIX Corporation, and serves as Executive Advisor to the Group CEO of Sompo Holdings, Inc. Sheard sits on the board of the Foreign Policy Association and on the board of advisors of the Levy Economics Institute of Bard College; he is a member of the Bretton Woods Committee, the Council on Foreign Relations, the Economic Club of New York, the Harvard Club of New York City, and the National Committee on U.S.-China Relations,

Sheard’s 1997 book in Japanese, The Crisis of Main Bank Capitalism, won the prestigious Suntory-Gakugei Prize, and was followed in 2000 by another book in Japanese, Mega Corporate Restructuring. Sheard has a Master of Economics and PhD from the ANU, and an honorary Doctor of Laws from his alma mater, Monash University. Married with two daughters and two grandchildren, he and his wife have lived in New York City since 2006.