Yes, Svensson was vindicated but the better part is that he showed that he...
Sweden is in the news: As Scott Sumner has posted: In any case, it can now be said that Lars Svensson’s critique of Riksbank policy has been proven “true” in the sense that his opponents have now...
View ArticleQE vs Forward Guidance
From the WSJ: “The Fed Favors Guidance Over Bond Buys”: The Federal Reserve’s forward guidance has been a lot more effective at keeping long-term rates down and stimulating the economy than its three...
View ArticleThe Fed has been “tedious” at a time it should be “exciting”
After a two day meeting you can wonder why it took 48 hours to…do nothing! From the Statement: The Federal Reserve on Wednesday said it would stop its long-running bond purchase program at the end of...
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When doing analysis it helps to get the facts straight
And Antonio Fatas in “Riksbank and ECB: Reverse asymmetry” misses badly: The Swedish central bank just lowered interest rates to zero because of deflation risks. This action comes after ignoring...
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Regarding Price Shocks, the Fed is “two-faced”
If oil prices rise (like in 2007-08) there´s a risk of permanently lifting inflation; but if oil prices fall, the effect on (dis)inflation is only temporary! From Fed Watcher Tim Duy: As I anticipated,...
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“Healthy” is a relative concept
The following is typical of comments on the GDP release: The U.S. economy expanded at a healthy pace during the third quarter, a sign of sustained growth fueled by government spending and a narrower...
View ArticleWhat the heck is Yellen talking about? “Views” or “Gender”?
Reminded me of “Women are from Venus and Men from Mars”!: Janet Yellen, the first woman to lead the Federal Reserve in its 100-year history, said Thursday the economics profession, which is dominated...
View ArticleSF Fed Williams “discovers” the “powder less gun”!
From the WSJ: Federal Reserve Bank of San Francisco President John Williams said on Friday that central banks’ largely successful pursuit of low inflation could mean they more frequently run into...
View ArticleA few are not content in saying “this is the new normal”
Last night I “voted” for Christy Romer to the Fed Board. Her newest paper puts some stars on the vote! In “NEW EVIDENCE ON THE IMPACT OF FINANCIAL CRISES IN ADVANCED COUNTRIES” she concludes: But our...
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When he coined the famous “…slave to some defunct economist”, Keynes was...
Over at Bloomberg/Business Week, Peter Coy has a long piece titled: “John Maynard Keynes Is the Economist the World Needs Now”. I highlight one paragraph which demonstrates the confusion over monetary...
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