tag:blogger.com,1999:blog-5713178645208582139.post2732254109952428431..comments2024-03-22T02:37:15.030-05:00Comments on Macro Musings Blog: Friends Don't Let Friends Mix Say's Law with MoneyDavid Beckworthhttp://www.blogger.com/profile/04577612979801459194noreply@blogger.comBlogger8125tag:blogger.com,1999:blog-5713178645208582139.post-5221659928692333732009-09-18T13:10:29.738-05:002009-09-18T13:10:29.738-05:00Thanks. My guess (I'm not in his head) is tha...Thanks. My guess (I'm not in his head) is that Cochrane feels it is undesirable that the individual should be impelled to spend at or beyond his total expected income - not that it doesn't happen.<br /><br />My concern about Farmboy's point (and Bill's too, maybe) is that "excess demand" for money is hard to determine, and enhancing government protection neither Joshnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-13990909983065102412009-09-18T11:00:31.524-05:002009-09-18T11:00:31.524-05:00please excuse this long comment to follow. I’m try...please excuse this long comment to follow. I’m trying to understand this issue and so far am hitting a wall.<br /><br />It seems like there are a few potential problems I’ve read about in the way this particular window of time is analyzed by the Keynesians, where people’s demand for higher cash balances (right?) leads them to cut back on spending in general and “purchase money with their output”.John Papolahttps://www.blogger.com/profile/15780555744195994216noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-35094407836311887682009-09-18T09:34:14.208-05:002009-09-18T09:34:14.208-05:00Says Josh:
Am I wrong in thinking that too many Ke...Says Josh:<br />Am I wrong in thinking that too many Keynesians spend too much of their attention on how to prevent unpleasant events, which could be rendered less unpleasant if people had more (dreaded) savings?<br /><br />If the US had a "safety net" such as they have in Europe and Australia, maybe recession prevention wouldnt be such a high priority for the Fed?<br />Perhaps this Farmboynoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-82155357549276495152009-09-18T09:20:29.465-05:002009-09-18T09:20:29.465-05:00Bill: I was fortunate to have a professor, Dr. Geo...Bill: I was fortunate to have a professor, Dr. George Selgin, who made Yeager required reading. I hadn't opened Yeager's book in sometime and only did so after Nick Rowe referred to him in his post. I need to go back and reread the rest of his book.<br /><br />Josh: You may be right on Cochrane's view, although it is hard to see how given that sentence. Like Nick Rowe, though, I David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-32810847733324518762009-09-18T08:33:17.265-05:002009-09-18T08:33:17.265-05:00Are you quite sure that really was Cochrane's ...Are you quite sure that really was Cochrane's point? I read DeLong's post too and I find it very hard to believe Cochrane would disagree with either of you that plans to spend are not fixed to real income.<br /><br />However, knowing that planned expenditures vary from total income does not necessarily give us license to push for further decoupling. Failure to save at a prudent level Joshnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-64996329615857084132009-09-18T07:18:55.291-05:002009-09-18T07:18:55.291-05:00In that same essay, Yeager discusses how an excess...In that same essay, Yeager discusses how an excess demand for short term bonds (like T-bills) can shift over to an excess demand for money as nominal yields approach the zero bound. He notes that this may have implications for the implementation for monetary policy. <br /><br />In other words, an excess demand for money that is a secondary effect of an excess demand for short term bonds Bill Woolseyhttp://monetaryfreedom-billwoolsey.blogspot.com/noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-25245331379074666672009-09-17T16:02:25.656-05:002009-09-17T16:02:25.656-05:00Thanks for the link ECB.Thanks for the link ECB.David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-27779219192402867402009-09-17T13:58:39.971-05:002009-09-17T13:58:39.971-05:00Everyone is raving about Krugman's essay on wh...Everyone is raving about Krugman's essay on whats wrong with macro. But a better review is provided by David Laidler available at http://economics.uwo.ca/econref/WorkingPapers/researchreports/wp2009/wp2009_2.pdf<br />He argues that modern macro is simply incapable of thinking about the current crisis by its use of an Arrow-Debreu framework. Although there are now attempts to build financial ECBnoreply@blogger.com