Relevant and even prescient commentary on news, politics and the economy.

It Looks Like a Great House. Why Does the Basement Always Flood?

Come on, guys, somebody take it to the Next Step. Matt Y comes closer than anyone else to getting to the truth of the problem with Macroeconomics. Following Justin FoxSteven Levitt’s summary, Matt asks the next question: So why should it be that “in the current regime, if [macro models] are not meticulously constructed from […]

The Roar of the Greasepaint, the Smell of the Crowd

There is a brilliant moment in the first season of Buffy the Vampire Slayer where Giles explains to Willow that his problem with computers is “their smell.” She replies, roughly, “But they have no smell.” “Exactly. And smell is one of the most important senses there is.” Apparently, with a hat tip to The New […]

I Remember When Mankiw was still a Neo-Keynesian

Cassander, writing at Steve Keen’s Debtwatch,* puts the hammer to those arguing that the death of the patient had nothing to do with the doctor: What a load of bollocks. The “principles of economics” that [N. Gregory] Mankiw champions, and the “More economic research (and teaching)” that [Doug] McTaggart et al are calling for, are […]

UnReal Business Cycle

Via Dr. Black, those RBC models may be missing a variable or two: In April, the rate in the United States rose to 8.9 percent. When the European figures are compiled, it seems likely that the American rate will be higher for the first time since Eurostat began compiling the numbers in 1993…. First, it […]

McMegan, Discrimination, and Inappropriate Loans

Susan of Texas has an immortal post on the housing crisis, McMegan’s ratiocination, and the persistence of ignorant memes. The money quote: McArdle doesn’t refute facts, she hen-pecks at the methods used to gather information. That way she doesn’t actually have to prove anything, she just casts enough aspersions on the data to confuse the […]