Is Brexit a Monetary Shock?
Both co-blogger Scott Sumner and blogger David Beckworth argue that the Brexit vote is a large monetary shock. To be a monetary shock, it has to be either (1) a shift in the supply of money or (2) a shift in the demand for money.
Scott argues that it’s not a shift in the supply of money. That then leaves only one possibility: a shift in the demand for money. But neither Scott nor David Beckworth makes the actual case that would make that clear.
How do we know there was a shift in the demand for money? And which money? The euro? The pound? Both?
They may well be right but, after having read their posts 3 times, I don’t see it.