Why is the Fed so embarrassed about wanting more AD?
For decades the Fed has steered the economy along a path of two to three percent inflation. The policy has not been controversial. Sometimes they ease, and sometimes they tighten. Recently inflation...
View ArticleWhy are macroeconomists so obsessed with interest rates?
If I wrote a macro textbook, I would try to avoid any mention of interest rates or inflation. The Fisher equation would use expected NGDP growth. The AS/AD model would use hours worked as the real...
View ArticleWhy doesn’t the government publish monthly GDP data?
A recent David Beckworth post linked to Macroeconomic Adviser’s monthly nominal GDP series. Please click on the Macro Adviser’s GDP link and take a look at the graph showing estimated monthly NGDP...
View ArticleSurely Krugman can do worse than this?
Paul Krugman continues his habit of assuming the worst about those with whom he disagrees. In a new post, entitled “The Worst Economist in the World” he discussed the following quotation from the WSJ:...
View ArticleWhere are the biggest “imbalances?”
There are a couple important principles in international economics: 1. National boundaries are not necessarily meaningful when evaluating the influence of a particular regional economy. The GDP of...
View Article“If we could guarantee 5% NGDP growth for several years, it would be great.”
Frequent commenter Derrill Watson sent me a recent post from his own blog: Mr. Dudley, President of the NY Federal Reserve Bank, is speaking at Cornell today. One of the economics faculty got him to...
View ArticleThe reason I could never be a government official
Daniel Sherry sent me this video of William Dudley responding to his question during Dudley’s talk at Cornell.
View ArticleMr. Bernanke: You are playing Wii, not mini golf
Ben Bernanke recently used a golf metaphor to describe monetary policy: In remarks simply titled “Gradualism,” then-Governor Bernanke explained the case for policymakers “to move slowly and...
View ArticleDon’t say I didn’t warn you
So here’s what I read when I woke up this morning: The dollar has been hit by expectations the Fed will announce new stimulus measures next month, diluting the dollar’s value. But it gained strength...
View ArticleWhy a little bit of inflation is good for savers
Will be in Dallas for a few more days. Just so you don’t think I disappeared, I dug up an old post I wrote but never posted. I saw the 3rd quarter NGDP was about 4%–surprised by the high deflator...
View Article