Tag Archives: Federal Reserve
M.C. Escher and the Impossibility of the Establishment Economic View
It’s easy to show that public institutions such as the Federal Reserve and Congressional Budget Office (CBO) are routinely blindsided by economic developments. You only need to compare their past predictions to real events to see these organizations’ deficiencies. More … Continue reading
Why Stock Prices Are More Stretched than You Think: A Tale of 3 P/E Multiples
Update: The charts below are based on reported earnings, which I converted to constant 2013 dollars using the CPI. Back in May, I suggested the stock market was showing some signs of froth, although “maybe in the same way that froth … Continue reading
Preparing for Bernanke’s Speech with a Short “Who Said It?” Quiz
In case you missed the late announcement, Ben Bernanke is scheduled to deliver a speech on Wednesday afternoon, covering the Federal Reserve Bank’s track record through its 100 year history. Presumably, he’ll also spend time defending current policies, in both prepared remarks and … Continue reading
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Tagged Ben Bernanke, Federal Reserve, Great Moderation, Great Moderation speech, National Bureau of Economic Research, Paul Volcker, William McChesney Martin
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Why We Shouldn’t Trust the Fed’s Inflation Target
Awhile back, I thought it might be interesting to create one of those island economy stories to demonstrate a problem with the Fed’s policy framework. I finally got around to it over the past week, after reading an article on the … Continue reading
Posted in Uncategorized
Tagged confirmation bias, David Stockman, Federal Reserve, heuristics and biases, inflation target, monetary policy, rational agents, stabilization policies, The Great Deformation, William McChesney Martin
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Fed Policy Risks, Hedge Funds and Brad DeLong’s Whale of a Tale
I have to say it was disappointing to see Brad DeLong’s latest defense of Fed policy, which was published this past weekend and trumpeted far and wide by like-minded bloggers. For those who missed it, the article is titled: “Bernanke … Continue reading
