These days there seem to be two types of thinkers in the world of central banking. On one side there are serious people "“ people who believe that we should raise interest rates in the face of high unemployment and falling inflation, because, well, that's what serious people do. On the other side there are unserious people, who believe that central banks should fight deflation as well as inflation, and try to prevent the current slump from turning into a quasi-permanent state of depression. How ridiculous can you get?
In Sweden, my former colleague Lars Svensson, now at the Riksbank, is concerned about the desire of his colleagues to raise interest rates in the face of inflation far below target and an economy that is a long way from having fully recovered. But what does he know? He's just one of the world's leading monetary economists, having spent a great deal of time studying problems of monetary policy at the zero lower bound.
In Britain, Adam Posen, on the Monetary Policy Committee, urges more action:
We will only know we will have done enough with QE [quantitative easing] or other monetary stimulus when we have clear indications that our policies are moving the desired variables "” market interest rates, wages, output, employment, and inflation expectations "” sufficiently and in the right directions on a sustained basis. I do not think that is not enough for a central bank to say, "?Look, we expanded our balance sheet more than any time in history,' or "?we did things we never did before,' and argue that therefore we must have done a lot, if not too much (not that the Bank of England has done so). In my opinion, that is backwards logic. It would be like saying "?that fire must be out, because we've already pumped more water than for any previous fire we've fought,' or "?we must have gotten to our destination, because I've been driving for hours and we've already used a full tank of gas.
But what does he know? He's just the leading English-speaking expert on Japan's lost decade.
Snark aside, the rise of the pain caucus is truly amazing "“ I'm a hardened cynic, yet even I didn't see that one coming. As Posen points out, mainstream macroeconomics "“ which suggests that we need a lot more stimulus, monetary and fiscal "“ has actually held up very well in this crisis; it has, above all, made the right predictions about inflation and interest rates, while the doctrines underlying the pain caucus have gotten it all wrong. Yet "serious" policy makers are rejecting the theory that works in favor of theories that don't.
Paul Krugman is an Op-Ed columnist for The New York Times.
"Structural" unemployment is a fake problem, which mainly serves as an excuse for not pursuing real solutions.
These days one of America's two great political parties routinely makes nonsensical promises. Banana republic, here we come.
Political rage is coming not from the jobless, but from the very privileged, who are furious at the thought of their tax cuts expiring.
Republicans are threatening to force a tax increase on the middle class unless they get paid off with tax breaks for the wealthy. It's an offer Democrats must refuse.
Japan knows that its economy is hurt when China buys up its bonds. It's the same for our economy, but our policy makers just don't get it.
September 29
Unserious Central BankersOnly the unserious care about deflation.
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CementgateAll possible puns have already been made.
September 28 //
Economics Is not a Morality PlayWar is bad, but sometimes spending is good.
September 28 //
Is It Good to Live in a Destroyed World?No, not really.
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Structural Problems, Not Structural UnemploymentNot the same thing.
From the Opinion Blogs Freakonomics Adrian Grenier Answers Your QuestionsLast week, we solicited your questions for the actor and director Adrian Grenier, whose new documentary film, Teenage Paparazzo, just made its HBO debut. His answers touch on everything from paparazzi methods to the role of the consumer in media culture. Thanks to all, especially Adrian, for playing along.
Schott's Vocab The Immigrant ParadoxPhenomenon whereby first generation immigrant children outperform second or third generation immigrant children in school.
Feeds Paul Krugman Blog RSS Subscribe to Paul Krugman’s Reading List Home World U.S. N.Y. / Region Business Technology Science Health Sports Opinion Arts Style Travel Jobs Real Estate Autos Back to Top Copyright 2010 The New York Times Company Privacy Terms of Service Search Corrections RSS First Look Help Contact Us Work for Us Advertise Site Map if (typeof NYTD.Blogs.user != 'undefined') { if(NYTD.Blogs.user.isLoggedIn()) { var dcsvid=NYTD.Blogs.user.getId(); var regstatus="registered"; } else { var dcsvid=""; var regstatus="non-registered"; } } var gaJsHost = (("https:" == document.location.protocol) ? "https://ssl." : "http://www."); document.write(unescape("%3Cscript src='" + gaJsHost + "google-analytics.com/ga.js' type='text/javascript'%3E%3C/script%3E")); var pageTracker = _gat._getTracker("UA-4406282-48"); pageTracker._initData(); pageTracker._trackPageview(); if((document.referrer).indexOf(document.location.hostname) == -1) { var referrer = document.referrer; } else { var referrer = ''; } document.write('');Only the unserious care about deflation.
September 29
CementgateAll possible puns have already been made.
September 28 //
Economics Is not a Morality PlayWar is bad, but sometimes spending is good.
September 28 //
Is It Good to Live in a Destroyed World?No, not really.
September 28 //
Structural Problems, Not Structural UnemploymentNot the same thing.
From the Opinion Blogs Freakonomics Adrian Grenier Answers Your QuestionsLast week, we solicited your questions for the actor and director Adrian Grenier, whose new documentary film, Teenage Paparazzo, just made its HBO debut. His answers touch on everything from paparazzi methods to the role of the consumer in media culture. Thanks to all, especially Adrian, for playing along.
Schott's Vocab The Immigrant ParadoxPhenomenon whereby first generation immigrant children outperform second or third generation immigrant children in school.
Feeds Paul Krugman Blog RSS Subscribe to Paul Krugman’s Reading List Home World U.S. N.Y. / Region Business Technology Science Health Sports Opinion Arts Style Travel Jobs Real Estate Autos Back to Top Copyright 2010 The New York Times Company Privacy Terms of Service Search Corrections RSS First Look Help Contact Us Work for Us Advertise Site Map if (typeof NYTD.Blogs.user != 'undefined') { if(NYTD.Blogs.user.isLoggedIn()) { var dcsvid=NYTD.Blogs.user.getId(); var regstatus="registered"; } else { var dcsvid=""; var regstatus="non-registered"; } } var gaJsHost = (("https:" == document.location.protocol) ? "https://ssl." : "http://www."); document.write(unescape("%3Cscript src='" + gaJsHost + "google-analytics.com/ga.js' type='text/javascript'%3E%3C/script%3E")); var pageTracker = _gat._getTracker("UA-4406282-48"); pageTracker._initData(); pageTracker._trackPageview(); if((document.referrer).indexOf(document.location.hostname) == -1) { var referrer = document.referrer; } else { var referrer = ''; } document.write('');All possible puns have already been made.
September 28
Economics Is not a Morality PlayWar is bad, but sometimes spending is good.
September 28 //
Is It Good to Live in a Destroyed World?No, not really.
September 28 //
Structural Problems, Not Structural UnemploymentNot the same thing.
From the Opinion Blogs Freakonomics Adrian Grenier Answers Your QuestionsLast week, we solicited your questions for the actor and director Adrian Grenier, whose new documentary film, Teenage Paparazzo, just made its HBO debut. His answers touch on everything from paparazzi methods to the role of the consumer in media culture. Thanks to all, especially Adrian, for playing along.
Schott's Vocab The Immigrant ParadoxPhenomenon whereby first generation immigrant children outperform second or third generation immigrant children in school.
Feeds Paul Krugman Blog RSS Subscribe to Paul Krugman’s Reading List Home World U.S. N.Y. / Region Business Technology Science Health Sports Opinion Arts Style Travel Jobs Real Estate Autos Back to Top Copyright 2010 The New York Times Company Privacy Terms of Service Search Corrections RSS First Look Help Contact Us Work for Us Advertise Site Map if (typeof NYTD.Blogs.user != 'undefined') { if(NYTD.Blogs.user.isLoggedIn()) { var dcsvid=NYTD.Blogs.user.getId(); var regstatus="registered"; } else { var dcsvid=""; var regstatus="non-registered"; } } var gaJsHost = (("https:" == document.location.protocol) ? "https://ssl." : "http://www."); document.write(unescape("%3Cscript src='" + gaJsHost + "google-analytics.com/ga.js' type='text/javascript'%3E%3C/script%3E")); var pageTracker = _gat._getTracker("UA-4406282-48"); pageTracker._initData(); pageTracker._trackPageview(); if((document.referrer).indexOf(document.location.hostname) == -1) { var referrer = document.referrer; } else { var referrer = ''; } document.write('');War is bad, but sometimes spending is good.
September 28
Is It Good to Live in a Destroyed World?No, not really.
September 28 //
Structural Problems, Not Structural UnemploymentNot the same thing.
From the Opinion Blogs Freakonomics Adrian Grenier Answers Your QuestionsLast week, we solicited your questions for the actor and director Adrian Grenier, whose new documentary film, Teenage Paparazzo, just made its HBO debut. His answers touch on everything from paparazzi methods to the role of the consumer in media culture. Thanks to all, especially Adrian, for playing along.
Schott's Vocab The Immigrant ParadoxPhenomenon whereby first generation immigrant children outperform second or third generation immigrant children in school.
Feeds Paul Krugman Blog RSS Subscribe to Paul Krugman’s Reading List Home World U.S. N.Y. / Region Business Technology Science Health Sports Opinion Arts Style Travel Jobs Real Estate Autos Back to Top Copyright 2010 The New York Times Company Privacy Terms of Service Search Corrections RSS First Look Help Contact Us Work for Us Advertise Site Map if (typeof NYTD.Blogs.user != 'undefined') { if(NYTD.Blogs.user.isLoggedIn()) { var dcsvid=NYTD.Blogs.user.getId(); var regstatus="registered"; } else { var dcsvid=""; var regstatus="non-registered"; } } var gaJsHost = (("https:" == document.location.protocol) ? "https://ssl." : "http://www."); document.write(unescape("%3Cscript src='" + gaJsHost + "google-analytics.com/ga.js' type='text/javascript'%3E%3C/script%3E")); var pageTracker = _gat._getTracker("UA-4406282-48"); pageTracker._initData(); pageTracker._trackPageview(); if((document.referrer).indexOf(document.location.hostname) == -1) { var referrer = document.referrer; } else { var referrer = ''; } document.write('');No, not really.
September 28
Structural Problems, Not Structural UnemploymentNot the same thing.
From the Opinion Blogs Freakonomics Adrian Grenier Answers Your QuestionsLast week, we solicited your questions for the actor and director Adrian Grenier, whose new documentary film, Teenage Paparazzo, just made its HBO debut. His answers touch on everything from paparazzi methods to the role of the consumer in media culture. Thanks to all, especially Adrian, for playing along.
Schott's Vocab The Immigrant ParadoxPhenomenon whereby first generation immigrant children outperform second or third generation immigrant children in school.
Feeds Paul Krugman Blog RSS Subscribe to Paul Krugman’s Reading List Home World U.S. N.Y. / Region Business Technology Science Health Sports Opinion Arts Style Travel Jobs Real Estate Autos Back to Top Copyright 2010 The New York Times Company Privacy Terms of Service Search Corrections RSS First Look Help Contact Us Work for Us Advertise Site Map if (typeof NYTD.Blogs.user != 'undefined') { if(NYTD.Blogs.user.isLoggedIn()) { var dcsvid=NYTD.Blogs.user.getId(); var regstatus="registered"; } else { var dcsvid=""; var regstatus="non-registered"; } } var gaJsHost = (("https:" == document.location.protocol) ? "https://ssl." : "http://www."); document.write(unescape("%3Cscript src='" + gaJsHost + "google-analytics.com/ga.js' type='text/javascript'%3E%3C/script%3E")); var pageTracker = _gat._getTracker("UA-4406282-48"); pageTracker._initData(); pageTracker._trackPageview(); if((document.referrer).indexOf(document.location.hostname) == -1) { var referrer = document.referrer; } else { var referrer = ''; } document.write('');Not the same thing.
Last week, we solicited your questions for the actor and director Adrian Grenier, whose new documentary film, Teenage Paparazzo, just made its HBO debut. His answers touch on everything from paparazzi methods to the role of the consumer in media culture. Thanks to all, especially Adrian, for playing along.
Phenomenon whereby first generation immigrant children outperform second or third generation immigrant children in school.
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