tag:blogger.com,1999:blog-5713178645208582139.post8647354428889663698..comments2024-03-22T02:37:15.030-05:00Comments on Macro Musings Blog: Three Objections to NGDP Level TargetingDavid Beckworthhttp://www.blogger.com/profile/04577612979801459194noreply@blogger.comBlogger9125tag:blogger.com,1999:blog-5713178645208582139.post-44040543889901579672011-10-23T15:06:21.609-05:002011-10-23T15:06:21.609-05:00Rebel Economist:
David cites two articles against...Rebel Economist:<br /><br />David cites two articles against nominal GDP targeting. There are many more that support it. Your claims about a "desperate attempt" indicates you don't know the literature.<br /><br />The same is true for your claim that the push for inflation is not based on objective economics. You will be hard pressed to find many studies arguing for a constant Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-69477545864566582172011-10-23T13:57:56.876-05:002011-10-23T13:57:56.876-05:00Benjamin,
Let's agree to differ on the motiva...Benjamin,<br /><br />Let's agree to differ on the motivation for hard money, but the fact is that a predictable value for money tends to foster sensible economic decision-making (eg you have to look for real solutions to problems), and has been regarded by many up and coming countries as one reason for, for example, Germany's economic success. Do we have to relearn the lessons of the RebelEconomisthttps://www.blogger.com/profile/13241098878248190971noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-21646608906525539082011-10-23T11:30:15.226-05:002011-10-23T11:30:15.226-05:00RebelEconomist:
A peevish fixation on inflation, ...RebelEconomist:<br /><br />A peevish fixation on inflation, usually coupled with some sort of Old Testament fervor about consequences, is going to be the intellectual death-knell for right-wing economists and maybe this nation.<br /><br />Keep you eye on the ball: Economic growth, prosperity, innovation, commercial freedom. <br /><br />Oh, we can beat inflation. You can move to Japan and you Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-5121494056886689632011-10-23T09:06:39.150-05:002011-10-23T09:06:39.150-05:00My objection to NGDP targeting is that, while the ...My objection to NGDP targeting is that, while the motives of its advocates may be honest, it is getting air time right now mainly because it provides intellectual cover for raising inflation, and providing the short-term easy but long-term damaging way out of present difficulties (surely it is still the consensus in monetary economics that a predictable value of money is desirable). As inflationRebelEconomisthttps://www.blogger.com/profile/13241098878248190971noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-25862188061496175972011-10-22T14:52:04.064-05:002011-10-22T14:52:04.064-05:00"The category of high yielding assets should ..."The category of high yielding assets should include corporate bonds, stocks, and high yielding capital."<br /><br />Stocks are high-yield when they are priced low relative to future earnings. That is not the case now, so Fed action that inflates stock prices from the current level will be harmful in the medium- to long-term. Mean reversion happens. <br /><br />Thus the objection to KHnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-30870262684428398592011-10-22T10:58:17.574-05:002011-10-22T10:58:17.574-05:00Nick, Bill W. and yourself have been very helpful ...Nick, Bill W. and yourself have been very helpful explaining these things. <br /><br />I have one question.<br /><br />"This change in expectations, in turn, would cause investors to rebalance their portfolios away from liquid, lower-yielding assets (e.g. deposits, money market funds, and treasuries) toward higher-yielding assets (e.g. corprate bonds, stocks, and capital). The shift into JP Koninghttps://www.blogger.com/profile/02559687323828006535noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-48848300254533036712011-10-22T08:31:32.623-05:002011-10-22T08:31:32.623-05:00Hi, just a point of fact.
> Bank lending, how...Hi, just a point of fact. <br /><br />> Bank lending, however, did not recover until 1935.<br /><br />In fact, it seems to have been much longer. Banks' loans outstanding were flat from '33 to '40, and by '47 had still not returned to '29 levels. And that's all in nominal dollars.<br /><br />http://www.asymptosis.com/banks-who-needs-em.html<br /><br />This just Steve Rothhttp://asymptosis.comnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-74731013705243805842011-10-22T03:29:41.651-05:002011-10-22T03:29:41.651-05:00with median household income down 6.4% & decli...with median household income down 6.4% & declining real disposable personal income, even the demand we see today is unsustainable...rjshttps://www.blogger.com/profile/15681812432224138582noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-47388098573756948422011-10-21T17:46:10.365-05:002011-10-21T17:46:10.365-05:00/* If we can agree that primary cause of the rece.../* If we can agree that primary cause of the recession is insufficient aggregate demand, then the fact that the U.S. economy is still sluggish is a sign that monetary policy has failed to do its job. */<br /><br />Phony demand through credit expansion is not real demand. If that went away, then a recession is actually a market force that is trying to correct already misallocated capital.<br /><elegantstrokehttps://www.blogger.com/profile/03516602011273896993noreply@blogger.com