tag:blogger.com,1999:blog-2761684730989137546.post2853646047379597895..comments2024-03-29T02:19:19.866-04:00Comments on Mike Norman Economics: Richard Koo versus Paul Krugmanmike normanhttp://www.blogger.com/profile/03296006882513340747noreply@blogger.comBlogger30125tag:blogger.com,1999:blog-2761684730989137546.post-74349473681084067032011-06-12T17:09:45.556-04:002011-06-12T17:09:45.556-04:00Tom,
Thanks. I'll have a look at this.
By t...Tom,<br /><br />Thanks. I'll have a look at this.<br /><br />By the way, I think you add a lot to this blog.Antihttps://www.blogger.com/profile/17677035271760844211noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-91733573098466769432011-06-11T19:41:28.950-04:002011-06-11T19:41:28.950-04:00Not a long-term study but some history:
Think big...Not a long-term study but some history:<br /><br /><a href="http://www.epicoalition.org/docs/thayer.htm" rel="nofollow">Think big deficits cause recessions? Think again! by Frederick C. Thayer</a><br /><br />Not decades but in 2004, <a href="http://www.epicoalition.org/docs/factiva.htm" rel="nofollow">Godley and Izurieta</a> foresaw the currency situation based on sectoral balances and say why the solution is fiscal rather than monetary.<br /><br />Here are some sectoral balance charts that cover decades:<br /><br /><br /><a href="http://pragcap.com/wp-content/uploads/2010/11/sectoral_balances1.png" rel="nofollow">Sectoral Financial Balances - 1952-2010</a><br /><br /><a href="http://bilbo.economicoutlook.net/blog/wp-content/uploads/2010/11/US_sectoral_balances_1952_2010.jpg" rel="nofollow">US_sectoral_balances_1952_2010</a><br /><br /><a href="http://bilbo.economicoutlook.net/blog/wp-content/uploads/2011/03/Japan_sectoral_balances_1980_2010.jpg" rel="nofollow">Japan_sectoral_balances_1980_2010</a><br /><br /><a href="http://farm6.static.flickr.com/5282/5295848825_3764c22875.jpg" rel="nofollow">Irish sectoral balances 2003-2009</a>Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-34073895708292193682011-06-11T17:51:44.501-04:002011-06-11T17:51:44.501-04:00I find the MMT perspective interesting so far, but...I find the MMT perspective interesting so far, but where can I find an empirical case for it? It's completely new to me and all I've seen are people arguing from accounting identities.<br /><br />Where is the exemplar case laid out that corresponds to data over decades?Antihttps://www.blogger.com/profile/17677035271760844211noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-81296834872739711702011-06-11T17:46:53.496-04:002011-06-11T17:46:53.496-04:00Matt,
I look at GDP numbers like these:
http://w...Matt,<br /><br />I look at GDP numbers like these:<br /><br />http://www.bea.gov/national/nipaweb/SelectTable.asp?Popular=Y<br /><br />Real GDP rose, unemployment fell, consumption increased, asset prices rose, inflation metrics rose, dollar exchange rate fell(yes, I know China's appreciating the RMB), etc., etc.<br /><br />I think the most compelling case for QE effectiveness is that inflation rose to within the Fed's stated target range of ~2%. That target's too low, and that's the only problem I can see. <br /><br />And again, it's not just asset inflation in stocks when both consumption and earnings rise.Antihttps://www.blogger.com/profile/17677035271760844211noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-57668146530827161732011-06-11T08:06:02.025-04:002011-06-11T08:06:02.025-04:00Anti,
Look at figure 1 in the Steve Keen article ...Anti,<br /><br />Look at figure 1 in the Steve Keen article Tom posted above.<br /><br />link_http://www.debtdeflation.com/blogs/2011/06/11/dude-where%E2%80%99s-my-recovery/<br /><br />Figure 1, US Real GDP Growth Rate: Falling ever since August '10<br /><br />I'm not saying QE2 caused this, I'm saying QE2 does not have any of the effects that policy makers stated it would; ie increased growth and increased employment. In fact the OPPOSITE happened.<br /><br />Resp,Matt Frankohttps://www.blogger.com/profile/11978352335097260145noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-39627267310611973342011-06-11T07:27:06.727-04:002011-06-11T07:27:06.727-04:00Anti,
I'll look at it.
For the time frame, d...Anti,<br /><br />I'll look at it.<br /><br />For the time frame, do you mean from about August '10 after Jackson Hole?<br /><br />So I'll look at August '10 thru June '11 ?<br /><br />Resp,Matt Frankohttps://www.blogger.com/profile/11978352335097260145noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-84809193689495449452011-06-11T06:05:40.744-04:002011-06-11T06:05:40.744-04:00Matt,
It wouldn't matter if there was a one m...Matt,<br /><br />It wouldn't matter if there was a one month boost from QE, if new drags on the economy show up. It doesn't mean QE failed. Would you deny that the economy improved for about 6-7 months after QE2 expectations began to become evident?Antihttps://www.blogger.com/profile/17677035271760844211noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-76094037776280422782011-06-10T21:47:41.952-04:002011-06-10T21:47:41.952-04:00Anti here is the link:
link_http://www.bls.gov/ne...Anti here is the link:<br /><br />link_http://www.bls.gov/news.release/empsit.a.htm<br /><br />Total employed in March was higher than now in May. yoy for end May we are up only 400k jobs for the year: THAT IS NOT GOOD.<br /><br />Growth rates realized and projected are going DOWN and being revised DOWN.<br /><br />And QE2 is NOT winding down. <br /><br />link_http://www.newyorkfed.org/markets/pomo/display/index.cfm?fuseaction=showSearchForm<br /><br />They have been buying 6-7B per day all along and current. They have not been letting up on purchases as we head into the end of it....<br /><br />This is the empirical data, not psycho-babble. this is the record of the statements of the actual policy makers at the Fed, not some moron media pudits who dont know macro.<br /><br />QE2 is a failure based on the criteria the policy makers at the Fed set themselves.<br /><br />Resp.Matt Frankohttps://www.blogger.com/profile/11978352335097260145noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-47072096635418340112011-06-10T16:42:05.834-04:002011-06-10T16:42:05.834-04:00Matt, what are you talking about? GDP rose and une...Matt, what are you talking about? GDP rose and unemployment fell for months, starting just about the time QE2 expectations set in last year. Now we get additional headwinds and QE2 is winding down and you think it failed? lol That's silly.<br /><br />Did QE2 raise NGDP and reach the Fed's stated 2% target? Yes. Is that sufficient for robust recovery? No, and everyone should know that. Do they wait too long to respond with more QE when new headwinds show up? Yes.<br /><br />If the Fed targets the forecast and actually maintains NGDP at 4 or 5% until we're back to pre-crisis trajectory, most of this anti-QE MMT talk dies. <br /><br />It raised real and nominal GDP, lowered the value of the dollar, boosted exports, boosted consumption and corporate profits, gave us nice recovery signals in the yield curve...<br /><br />Again, what does QE success look like? Do you think a central bank can just run one weak program and then expect you'll never need more stimulus again?Antihttps://www.blogger.com/profile/17677035271760844211noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-7413554541127310362011-06-10T16:36:46.511-04:002011-06-10T16:36:46.511-04:00This comment has been removed by the author.Antihttps://www.blogger.com/profile/17677035271760844211noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-19678816910691136442011-06-10T07:39:09.288-04:002011-06-10T07:39:09.288-04:00Anti,
"I don't think you understand what...Anti,<br /><br />"I don't think you understand what QE's supposed to do."<br /><br />Here it is right from the Feds press release of Nov 2010:<br /><br />"<b>To promote a stronger pace of economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate</b>, the Committee decided today to expand its holdings of securities. The Committee will maintain its existing policy of reinvesting principal payments from its securities holdings. In addition, the Committee intends to purchase a further $600 billion of longer-term Treasury securities by the end of the second quarter of 2011, a pace of about $75 billion per month. The Committee will regularly review the pace of its securities purchases and the overall size of the asset-purchase program in light of incoming information and will adjust the program as needed <b>to best foster maximum employment and price stability</b>."<br /><br />Since this statement, the unemployment rate has RISEN and the growth rate has FALLEN.<br /><br />As my 12 year old would say: "EPIC FAIL!"<br /><br />The Fed policy makers and our elected econ policy makers are a disgrace to humanity.Matt Frankohttps://www.blogger.com/profile/11978352335097260145noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-63024818417071809092011-06-09T01:18:06.275-04:002011-06-09T01:18:06.275-04:00STF,
I don't think you understand what QE'...STF,<br /><br />I don't think you understand what QE's supposed to do. It's supposed to increase consumption, increase exports, lower the value of the dollar, decrease unemployment, increase NGDP and RGDP, increase asset prices in fundamentally sound ways, etc. Stock prices went way up and so did corporate profits following each of the QE events I mentioned.<br /><br />What is QE success supposed to look like?<br /><br />And now you mention a sagging economy? Well of course that doesn't mean QE failed. We're sinking now from a higher base and it's due to new drags on growth, requiring more QE. <br /><br />There was never anything close to enough QE done in the first place, and anyway, when additional problems arise, additional QE is needed when at the zero bound. <br /><br />The stupid Fed's been trying to target inflation at 2%, when it should have been at 5-6% at least when QE started, and they often lag in their response to falling short of their target anyway. That's what's happening now.Antihttps://www.blogger.com/profile/17677035271760844211noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-89906310777521314192011-06-09T00:19:36.860-04:002011-06-09T00:19:36.860-04:00Anti,
QE drove all sorts of speculation in equiti...Anti,<br /><br />QE drove all sorts of speculation in equities and commodities that drove GDP. Your point about 2010Q3 is perfectly consistent with this. Cullen Roche--and MMT'er, by the way--was all over this from the very beginning.<br /><br />And, of course, even with that, the economy's been slowing long before QE's over.STFhttps://www.blogger.com/profile/16261666934714196464noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-73244075780457461392011-06-08T16:49:27.101-04:002011-06-08T16:49:27.101-04:00Seems to me if you combined Richard Werner and Ric...Seems to me if you combined Richard Werner and Richard Koo you get MMT. Two of the leading economists that understand the Japanese malaise.Adam2https://www.blogger.com/profile/03710514839937913226noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-34152667262871066862011-06-08T16:33:13.713-04:002011-06-08T16:33:13.713-04:00moneyfornothingchicks4free, did you ever get an an...moneyfornothingchicks4free, did you ever get an answer regarding Richard Werner. He seems so close. Yet so far away.Adam2https://www.blogger.com/profile/03710514839937913226noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-61342302045060437842011-06-08T14:50:03.455-04:002011-06-08T14:50:03.455-04:00THEY CAN'T DOWN RATE OUR RATINGS IF WE ARE BUS...THEY CAN'T DOWN RATE OUR RATINGS IF WE ARE BUSY MAKING JOBS AND MORE ASSETS<br /><br />HOW'S THAT ?googleheimhttps://www.blogger.com/profile/14459089745473598235noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-69401464485084649422011-06-08T14:49:28.397-04:002011-06-08T14:49:28.397-04:00IN FACT AFTER LOOKING AT THE KOO'S BERNANKE RE...IN FACT AFTER LOOKING AT THE KOO'S BERNANKE REVIEW VIDEO ON THE SAME LINK<br /><br />IT ONLY REFLECTS THE GOOGLEHEIM HYPOTHESIS POSITED SEVERAL TIMES IN THIS BLOG :<br /><br />THE BANKS KEPT ALL THE MONEY AND IT WAS NOT SPENT FISCALLY<br /><br />IT BREAKS THE LAWS OF FISCAS<br /><br />MORE PIPELINES, MORE WATER TRANSMISSION LINES, MORE CONSTRUCTION, MORE SUPERCONDUCTOR SUPERCOLLIDERS, MORE TRAINS, MORE ECOLOGICAL STRUCTURES LIKE BIOSPHERE CITIES, ...<br /><br />similar to dark matter - it's pointless and it is not evident if it really does anything in the universe - like cellulite you don't need it for the organism<br /><br />LET'S MAKE STUFF<br /><br />HOW'S THAT ? STOP BUYING CHINA CRAPgoogleheimhttps://www.blogger.com/profile/14459089745473598235noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-64898866194541253332011-06-08T14:45:16.063-04:002011-06-08T14:45:16.063-04:00ok
we need Richard Koo on tap here on this blog
...ok<br /><br />we need Richard Koo on tap here on this blog<br /><br />more historical mechanics on Japan so we can make money while this thing rides outgoogleheimhttps://www.blogger.com/profile/14459089745473598235noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-61134444716538988602011-06-08T14:31:30.991-04:002011-06-08T14:31:30.991-04:00Hi Adam
Just both at same time.
All this hoopla ...Hi Adam<br /><br />Just both at same time.<br /><br />All this hoopla about Japan's lost decade but no firm analysis giving case by case by case historical review - <br /><br />not even Frontline has covered the lost decade or I might be wrong - I will check.<br /><br />i am not about to pull up a book or a journal, but you would think that Japan would have been blisteringly imprinted on USA starting in 2002 - with all warnings and stops on file<br /><br />instead we got all these mathematicians and physicists going to financial engineering and making these models for derivatives which are so elegant for they are derived from tools quantum mechanics provided<br /><br />what we got is a big sucking noise that pulled all mortgages from the banks and spit out at a bigger sucking noise<br /><br />all the liar loans and all the foreclosures plus more could have been covered by 50% of the original TARP only without QE1 and QE2<br /><br />therefore it's the wars and the deregulation<br /><br />the problems of today were given to us by our grandfathers of the 70's and 80's, and they were deregulationistas<br /><br />the hoopla of debt today is a sin to our grandchildren of the future is a smoke screen for the fact that we are already living today with the effects of deregulation to which we are mortgaged by the fault of our "grandfathers"<br /><br />yes, we needed more reports from Japan since 1995 and more awareness of the country that we were buying all their crap and the Japanese hold $1 trillion of our debt for same as Brits and Chinesegoogleheimhttps://www.blogger.com/profile/14459089745473598235noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-37706690670116862992011-06-08T14:29:45.144-04:002011-06-08T14:29:45.144-04:00While it may seem additional fiscal spending is da...While it may seem additional fiscal spending is dangerous, Koo argues that when companies and individuals are paying down debt and saving there is glut of savings in the system to buy that sovereign debt.<br /><br />Koo might be right but he doesn't get It either.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-12093412179339392512011-06-08T13:00:41.729-04:002011-06-08T13:00:41.729-04:00Even trying QE is a dumb idea with the reasons the...Even trying QE is a dumb idea with the reasons they gave.<br /><br />For the proponents of QE <br /><br />QE = extend credit.<br /><br />extend credit = more private debt<br /><br />This is not needed when households are already in over their heads with too much debt.Adam2https://www.blogger.com/profile/03710514839937913226noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-24048606965331441652011-06-08T12:14:55.078-04:002011-06-08T12:14:55.078-04:00googleheim - Are you being ironic or not? I canno...googleheim - Are you being ironic or not? I cannot tell.Adam2https://www.blogger.com/profile/03710514839937913226noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-55925766738281040332011-06-08T10:23:34.751-04:002011-06-08T10:23:34.751-04:00What about Japan ?
This blog is nothing without a...What about Japan ?<br /><br />This blog is nothing without a Japanese MMT experienced theorist.<br /><br />Someone needs to come up and explain how things went in Japan for the past 20 years and how things are coming along here.googleheimhttps://www.blogger.com/profile/14459089745473598235noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-27178448526597791872011-06-08T08:58:05.408-04:002011-06-08T08:58:05.408-04:00Well, we are going to find out. QE2 is ending and ...Well, we are going to find out. QE2 is ending and QE3 is not planned. Fiscal austerity is the word of the day. Either the GOP claim that fiscal austerity is expansionary is going to work, obviating the need for QE3, or it's not and markets will tank. Then the Fed will rush in with QE3, while the deficit will decline due to fiscal austerity. The we'll see whether GDP increases due to QE or not. Should only take a couple of quarters to find out.Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-869226501913552322011-06-08T04:10:51.281-04:002011-06-08T04:10:51.281-04:00With respect to QE1, it was actually an extension ...With respect to QE1, it was actually an extension of it announced March 18, 2009, after which the markets and economy started a huge recovery.Antihttps://www.blogger.com/profile/17677035271760844211noreply@blogger.com