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

Feasible Stimulus Politics ?

Robert Waldmann Obama proposes an additional $ 50 billion for infrastructure. He ignored my proposal to mail a $ 500 check to every US family this month. The proposal is better policy than my proposal. If implemented it wouldn’t help Democrats in November, since it would start next year. My guess is the plan is […]

Politically Feasible Stimulus

Robert Waldmann Is going to disagree with Barack Obama and Paul Krugman (alternative title “which one here is not like the others”). Krugman writes and Obama implies that no large stimulus will pass congress. I think a proposal to send a $500 check to every US citizen containing family would pass congress. In particular some […]

Cyclical vs Structural Unemployment part N

Robert Waldmann Kevin Drum stresses the very sound point that even if part of current unemployment is structural, we should stimulate to get rid of the part which is cyclical. I don’t have a serious disagreement and choose to debate his guess as to the level of structural unemployment for the sake of debating. “The […]

Central Banks can target short term interest rates no matter what

Robert Waldmann Paul Krugman asks a rhetorical question which I dare to answer. He is still considering Kocherlakota’s argument that low interest rates imposed by the monetary authority must cause deflation. “First of all, if inflation isn’t sticky, how is it that the Fed can set short-term interest rates at all?” Second of all, there […]

Saul Alinsky vol II Rules for Republicans

Robert Waldmann Saul Alinsky sure has a lot of followers. Obama is a fan. Hillary Clinton wrote her senior thesis about Alinsky. However the people who follow him to the letter are Republican’s who want to privatize social security. Rule 13 (slightly edited) 13. Pick the target … personalize it,… The latest follower of Alinsky […]

Housing Bubble ?

Robert Waldmann Andrew Harless argues that there was no housing bubble ?!? Apparently it is now generally accepted that the rise in house prices was an aberrant bubble, justified only in the minds of irrational buyers who ignored the fundamentals and expected house prices to keep rising simply because they were already rising. But what […]

Kocherlakota loose money and deflation

Robert Waldmann Minneapolis Fed President and famous economist Narayan Kocherlakota made my jaw drop with this argument Long-run monetary neutrality is an uncontroversial, simple, but nonetheless profound proposition. In particular, it implies that if the FOMC maintains the fed funds rate at its current level of 0-25 basis points for too long, both anticipated and […]

Long Term Debt Outlook

Robert Waldmann I’m not sure if I should post this here. I think it might be stimulating. However, I am ignorant and have no intention of learning (except from comments). I feel free to display my ignorance after the jump. The conventional wisdom seems to be that we have to do something about the long […]

Deficit Nonsense in the WSJ

Robert Waldmann Jonathan FBD Weisman strikes again. I blame Kevin Drum for the fact that I read a grossly dishonest article of his in the Wall Street Journal. The article is about public attitudes on the deficit and on proposed solutions. As a normal journalist, Weisman stresses anecdotes and only briefly mentions polling data. I […]

Reinventing Government Ruining the Gulf of Mexico

Robert Waldmann This article by David Hilzenrath in the Washington Post is interesting. The news is that an internal inspection for Transocean use reported that some equipment (two cranes) had to be replaced and could not be used, but the official inspection outsourced to a private firm, concluded that everything was fine (this is the […]