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Predict

Do Bad Forecasts Mean Bad Economics?

By on January 21, 2012 in All Posts, Economic Theory
Proper methodology is often debated in economics. Inevitably, one side points out that the other side has made some very embarrassing predictions. Pro-market folks love to reference WWII era Keynesians who thought that the United States would go back into depression after the government stopped spending vast amounts of money on war goods. As it…
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File:Waiting for relief checks during Great depression.jpg

Is Joseph Stiglitz Serious?

By on January 17, 2012 in All Posts, Economics in Media
In this month’s Vanity Fair renowned economist Joseph Stiglitz discusses important lessons economists should take from the Great Depression. The article is lengthy, but interesting if you have the time. Stiglitz, a Keynesian, gives the expected presentation: manipulating financial markets (monetary policy) is ineffective in combating recessions and we need greater government spending (fiscal policy)…
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McDonalds

$12/hour minimum wage?

By on January 10, 2012 in All Posts, Economic Theory
Saving our economy is only a minimum wage hike away, according to James Galbraith. Galbraith is not the first to commit such a basic economic error, as we have pointed out. In Galbraith’s words: “Raise the U.S. minimum wage. By a lot — let’s say, to $12 an hour, from the current rate of $7.25.”…
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Economy a little flat? Whip in some inflation!

By on January 6, 2012 in All Posts, Economic Theory, Economics in Media
Sometimes economists make analogies to make policies coherent. I find this by line particularly appetizing, imagining Bernanke as a soufflé chef trying to keep his light dessert fluffy. According to Menzie Chinn and Jeffry Frieden, the solution is just to whip in a little inflation to keep that soufflé/economy healthy. The basic idea they convey…
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Incomplete Logic Strikes Again!

By on December 30, 2011 in All Posts
Pat Garofalo of Think Progress bemoans the worsening housing crisis as housing prices fall ever lower despite marginal gains in employment. To be clear, Pat is just expanding on a recent Wall Street Journal piece. What both articles highlight is the fact housing prices have failed to rebound. Low home values have made it much…
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The Economist

The Economist Speaks!

By on December 29, 2011 in All Posts, Economics in Media
http://www.economist.com/node/21542174 Is fiscal stimulus not working? Then do more of it, say the neo-chartalists. Are monopolies and price controls a problem? Then get rid of the central bank’s monopoly in setting the price of credit and the supply of government money, say the Austrians The Economist, beloved and respected throughout the profession, ridiculed by outsiders…
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What is Elizabeth Warren Talking About?

By on December 24, 2011 in All Posts
“There is nobody in this country who got rich on their own. Nobody. You built a factory out there – good for you. But I want to be clear. You moved your goods to market on roads the rest of us paid for. You hired workers the rest of us paid to educate. You were…
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