baselinescenario.com - 4/6/2009
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There are two ways to think about inflation in today’s economy. The first, suggested by conventional macroeconomic frameworks for the US, is that, with rising unemployment and actual output sinking further below “potential” output, inflation will stay low - and we could ...
bloomberg.com - 4/13/2009
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bloomberg.com —
April 13 (Bloomberg) -- Federal Reserve Chairman Ben
S. Bernanke is siding with John Maynard Keynes against...
Milton Friedman by flooding the financial system with money. If history is any guide, says Allan Meltzer, the effort will end in tears. ...
(more)
Bernanke Bet on Keynes Has Meltzer Seeing 1970s-Style ...
calculatedriskblog.com - 4/4/2009
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calculatedriskblog.com —
It looks like the FDIC cancelled Friday ...
From Simon Johnson and James Kwak of Baseline Scenario...
writing in the WaPo: The Radicalization of Ben Bernanke ... Shortly after joining the Fed in 2002, Bernanke gave a speech describing how the Fed could ...
(more)
Inflation vs. Deflation
baselinescenario.com - 4/8/2009
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baselinescenario.com —
For a complete list of Beginners articles, see
Financial Crisis for Beginners . Only a few years...
ago, the accepted remedy for a recession was for the Federal Reserve to lower interest rates - namely, the Federal funds rate . Now, however, the economy has been stuck in recession for over ...
(more)
Inflation Expectations for Beginners
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Monday links: rundown rally
Abnormal Returns —
... “Excessive inflation is a typical outcome in oligarchic situations when a weak (or pliant) government is unable to force the most powerful to take their losses - high inflation is, in many ways, an inefficient and regressive tax but it’s also often a transfer from poor to rich.” (Baseline Scenario) ...
Fed Watch: More on Inflation Expectations
Economist's View —
... Now, credibility cuts both ways. The above analysis suggests that the Fed has so far staved off deflationary expectations by acting in a manner consistent with its inflation target. But suppose inflation rises above that target - perhaps velocity explodes, so that inflation rises even if output remains at suboptimal levels (something akin to Johnson and Kwak's emerging market scenario). Then the Fed would need to maintain its commitment to the inflation target by contracting the balance sheet. From the minutes: ...
Further reading
FT Alphaville —
Elsewhere on Tuesday, - A new way to bet on house prices . - Inflation prospects in an emerging market, like the US. - An interview with a teary Sir Allen Stanford . - Begun, the Stanford receiver war has. - The bear bottoming process, in chart-form. - Relaxing FAS 157 + Release of Treasury stress test results = A Positive Manufactured Outcome . - Idiotic online brokerage of the day. - “There is a real danger that the results of the stress test are uncovered and this roils the markets”. - Have pensions ...
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NO SIGN OF INFLATION. SO WHY WORRY?
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