Muchas gracias.

What the hell does he think “jobs created or saved” is if not net employment change. The point is it’s a net change from the counterfactual. Net change from last quarter isn’t entirely uninteresting, but it’s meaningless in interpreting the impact of a policy. Any economist could tell you that.

1. The recently inaugurated policy of paying interest on reserves changes the relationship between increased reserve levels and the money supply. In other words, what you’re seeing is a huge increase in M1, but the rate at which it gets out into the economy increased dramatically since I think it was last October when they started paying interest. People are still looking at M1 stats with a pre-2008 mindset. Other central banks have always done this.

2. People disagree on the correct inflation targeting rules, but none of the rules floating around out there say that what the Fed is doing now is particularly expansionary, because the output gap is so high and inflation is so low.

I should ask you – why do you think increasing reserves and low rates necessarily make for an expansionary policy? The economy is not a static thing. What may have been an expansionary rate or reserve level in 2005 may not be expansionary today.

Here he is May of 2 thousand and fricking 8 still prediciting no recession.

WSJ
MAY 8, 2008, 6:15 A.M. ET Lazear Sees No Recession for U.S. Economy

http://online.wsj.com/article/SB121019473822674751.html

Hmm, who would have thought?

http://www.freetochoosemedia.org/production/POC/presskit2/milton-president-reagan.jpg

The libertarian economic ideology foisted on our economy these last 30 years has sucked it dry. We’re trying to crank an engine with no gas. All the money is on top or in off shore accounts. The big spenders, (ie the middle class) have been sucked dry and can’t pick up demand Uncle Sam is trying to stimulate.

We’ve still a long way to go to turn around 30 years of Milton.

Why not an electric motor? Or a paddle wheel? Maybe like a space rocket?

Fast recovery? Like the one in Germany? Where the conservative German government was lambasted for not spending enough? Or maybe you mean fast recovery like in Spain where unemployment is over 17% still?

Crock of shit, through and through.

Not only here but in Europe where the stimulus is built into their social safety net and they are seeing a faster recovery then us.

The crucial question is whether a large increase in government spending financed with borrowed money that swells the deficit to $1.4 trillion is good for confidence or bad for it. No one knows the answer.

I know the answer in my case. I’d be a lot more confident right now if my next project weren’t a “stimulus” project, and I’m confident regardless only because I believe the project would exist regardless.

“After the US experience during the Great Depression, and after inflation and rising interest rates in the 1970s and disinflation and falling interest rates in the 1980s, I thought the fallacy of identifying tight money with high interest rates and easy money with low interest rates was dead. Apparently, old fallacies never die”

I’m not sure where Miron gets the idea that monetary policy especially expansionary right now. The argument I’ve been hearing is over whether it is still too tight or whether it is just right. I haven’t heard “highly expansionary” before – with the possible exception of mises.org.