For next time someone attacks macro based on the “money multiplier”

Via the Wonkmonk twitter, this paper from the Fed.

The effect of reserve balances in simple macroeconomic models often comes through the money multiplier, affecting the money supply and the amount of bank lending in the economy. Most models currently used for macroeconomic policy analysis, however, either exclude money or model money demand as entirely endogenous, thus precluding any causal role for reserves and money.

This makes more sense if you are willing to think of economic models not as “general models” by as models of individual tendencies – identifying specific causal mechanisms.  In this way, policy making requires “multiple models”, and trying to say something like “you entirely rely on money multipliers” really doesn’t make sense.