- The big question is: what institutional—and perhaps political—changes are necessary to avoid another wild swing?
- Larry Summers: Get to grips with vicious cycles
- Martin Wolf: Pathology, prophylactics and palliatives
- Barry Eichengreen: Get to work on jobs
- Jim O’Neill: Learn to learn from China
- Tim Congdon: Figuring out (again) where the banks fit in
Pretty good at asking some of the right questions. I agree that it is a should-read.
WCEG — The Equitablog
Should-Read: Prospect Magazine: Back to School: Top Economists on What Their Subject Needs to Learn Next
Brad DeLong
1 comment:
One of the equations (the so-called “Taylor rule”) prescribed heavily negative interest rates to deal with the slump. This would have been fine, except that interest rates cannot go much beneath zero. Tim Congdon
It seems ethical considerations are scorned wrt fiat creation but interestingly they require non-positive (0 or negative) interest rates on the inherently risk-free debt of monetary sovereigns to avoid welfare proportional to account balance, i.e. to avoid welfare proportional to wealth instead of, say, proportional to need. And since account balances at the central bank (aka "bank reserves") have the shortest maturity it is reasonable to suppose that they should cost the most, i.e. have high negative interest.
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