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Wednesday, March 30, 2011

Has cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Fed Done Too Little or Too Much?

David Leonhardt of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 New York Times says too little:
It’s clear which way cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Fed has erred recently. It has done too little. It stopped trying to bring down long-term interest rates early last year under cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 wishful assumption that a recovery had taken hold, only to be forced to reverse course by cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 end of year.

Given this recent history, you might think Fed officials would now be doing everything possible to ensure a solid recovery. But cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y’re not. Once again, many of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365m are worried that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Fed is doing too much. And once again, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 odds are rising that it’s doing too little. 
Yes, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Fed fell asleep on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 job last year and yes, QE2 was a weak version of what could have been a more effective monetary stimulus program where cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 price level or nominal GDP level  was targeted. What is not true is that a successful monetary stimulus program will be defined by sustained low long-term interest rates.  A successful monetary stimulus by definition would lead to a robust recovery.  Though this would be initially associated with lower interest rates, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 robust recovery should ultimately lead to higher interest rates.  Given cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 forward looking nature of markets, just cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 expectation of  an increase in economic activity should put upward pressure on current interest rates.  Initially, this seemed to be happening with QE2: long-term interest rates dropped and cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365n started to increase as growth expectations picked up.  Bernanke, of course, took credit for this development.  Now, long-term rates are nudging down again as growth expectations stall. One could call this a passive tightening of monetary policy.

Update: I meant to include this picture of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 nominal and real (i.e. TIPS) 10-year treasury interest rates.


2 comments:

  1. Excellent posts of late.

    Why, oh why, have "conservatives"--normally more astute regarding economic and business matters--become so koo-koo when it comes to monetary policy?

    Where are cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 inflationary surges? In real estate? No.
    In wages? No.

    So with unit labor costs falling, and real estate softer than brown bananas, where does inflation come from? How is it sustained?

    The cult of zero inflation and tight money, coupled with a near-spiritual attachment to gold, would be lamentable if only it were only academic fad at play.

    But cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365se people are dangerous to our prosperity.

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  2. Benjamin,
    Maybe cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y've become "koo koo" as a result of being scared shitless by a bunch of lunatics with a gun fetish?

    ReplyDelete