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Scott Sumner: October 2014

An Author Archive by Month (15 entries)

Supply and demand-side stagnation

Macroeconomics
Scott Sumner
Tyler Cowen often has posts entitled "A very good sentence." Here Tyler dishes up one of his own: Yes, it is a big mistake to assume Say's Law always holds but it is an even bigger mistake to think it... MORE

The Germans have traditionally argued that the ECB should focus like a laser on their inflation target, paying no attention to unemployment. Fair enough. But how are they supposed to do this? The exact target is kind of vague, below... MORE

My naivete about government officials

Monetary Policy
Scott Sumner
Back in the 1980, I believed the Fed needed to target inflation or NGDP, and if they did so the problem of high inflation could be solved. These views were widely mocked by people on both the left and the... MORE

The title is my pathetic attempt to imitate Miles Kimball and Noah Smith, who sometimes post on religion. This won't be about religion; it's about monetary policy. Oh wait . . . In the 1970s, US policymakers knew that inflation... MORE

Did the Bush tax rebates actually work?

Fiscal Policy
Scott Sumner
Here's Matt Yglesias on fiscal stimulus: What the country needs is a stimulative process that has the bureaucratic properties of monetary policy, but the heft and comprehensibility of fiscal stimulus. If we had a national sales tax like Japan does,... MORE

Nominal GDP is not real (and is really tiny)

Monetary Policy
Scott Sumner
Sometimes I argue that nominal GDP is like Coke, it's the "real thing." By that I mean it's a well-defined concept, the dollar value of all output of final goods and services. Of course I exaggerate, there are some conceptual... MORE

Housing and poverty

Regulation
Scott Sumner
The traditional definition of poverty in America has been criticized for ignoring factors such as government benefit programs and regional variation in the cost of living. Now the Census Bureau has released new estimates of poverty, which account for various... MORE

It's the economy, stupid

Macroeconomics
Scott Sumner
Here are some things that seem very likely: 1. The global stock/oil/bond yield plunge is at least partly due to expectations of slower nominal GDP growth. I know of no other economic news could explain a sudden decline of this... MORE

Do bad times make us less smart? It sometimes seems that way. When times are good, people dispassionately explain how you don't want to overreact to plagues with draconian policies like quarantines, especially if the disease is not highly contagious.... MORE

No hawks or doves, just owls

Monetary Policy
Scott Sumner
Here is Germany's representative at the ECB, Jens Weidmann: Mr. Weidmann's conservative stance contrasts with the ECB's latest attempts to convince investors that it will act forcefully to boost the flow of money to the economy, and may raise doubts... MORE

Economics is symmetrical

Monetary Policy
Scott Sumner
Many economic models are symmetrical. If higher business costs lead to higher prices, then lower business costs lead to lower prices. Thus if higher raw tobacco prices lead to higher cigarette prices, then lower tobacco prices lead to lower cigarette... MORE

A certain laxity in word choice

Finance
Scott Sumner
Matt Yglesias is normally my favorite progressive blogger, but today I have two bones to pick. The first is perhaps a bit picky, as I object to a single word: On the other hand, one can make the case that... MORE

Words and meaning (good theft and bad)

moral reasoning
Scott Sumner
Many people like to attack ideas by linking them up with words that have ambiguous meaning, but either very positive or very negative connotations. Then they use the word as a sort of crude cudgel, to bash their opponent. This... MORE

In a recent post I criticized the "free lunch" view of printing money. However I did acknowledge that there was a sort of free lunch aspect to having a monetary system, but only to the tune of a bit over... MORE

Still no free lunch

Monetary Policy
Scott Sumner
Here's Matt Yglesias: Here's the thing about the federal government -- it can print dollars, a highly profitable activity. You can't print dollars. I can't print dollars. Vox Media can't print dollars. The state of Tennessee can't print dollars. These... MORE

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