More Great Quotes from the Past

From a reader in 2018:

The people 2slugs disdains can overhaul an engine and cultivate a field way better than 2slugs, and have way more “common sense” than many university professors. The supposed nincompoop Trump voters in his 2 years have lead a national economic performance that Obama in his 8 years, lead by “elites” such as 2slugbaits, never did, and in fact said was impossible. Who is the expert here?

In 2017Q1-20Q1, GDP growth averaged 1.9%, and in Obama’s second term averaged 2.4%. (In Trump’s first two years, GDP growth averaged 2.6%. To be clear, what mainstream economists said was impossible was the 4% or 5% growth Trump promised.

 

 

 

39 thoughts on “More Great Quotes from the Past”

  1. pgl

    THIS sammy has always been numerically challenged. I guess that is what happens when one wakes up before the crack of dawn to tend to the crops!

    1. Moses Herzog

      Sammy is a common name, but we’re not really buying that one are we??? I like to give people the benefit of the doubt, but……

  2. pgl

    “what mainstream economists said was impossible was the 4% or 5% growth Trump promised.”

    John Cochrane told us that these long-term growth rates were possible if we deregulated. His model was akin to taking the weeds out of the garden. OK that flunks the Lucas critique but it appeals to farmer sammy!

  3. 2slugbaits

    I will say that my gardening skills have improved over the last three years. Not only are my tomatoes doing fine, but so are my beets, lettuce and herbs. And the neighbors seem quite impressed with my new pollinator garden.

    1. Moses Herzog

      I for one, got your point Sir. You horrible horrible “elitist”. If the butterflies visit your perennials, that’s it!!!! The Red Guard of sammy is coming to get you.

    2. Moses Herzog

      I should add for extra measure, your “elitist” lettuce is “being watched”. Step carefully Sir. : )

    3. Willie

      So long as you don’t plant zucchini, you are all good. If you plant zucchini, you get what you deserve.

  5. noneconomist

    Brings a tear to my eye. How we forget the Trump family getting its start homesteading in Nebraska, or the Mnuchins operating that little hot dog stand in Burbank. Only to rise to great heights despite opposition from socialist elitists and various economic evil doers.
    Yes, meritocracy is alive and well in sammy’s America where the Trump brothers are as adept at mechanical labor as they are in high finance. Where Larry Kudlow can turn a big profit Promoting non-plant based beer while making sure his followers understand the common sense dictum that tax cuts always pay for themselves.
    Indeed. Who are the experts here?

  6. pgl

    sammy’s weird attack on 2slug was within a post about the deaths after Hurricane Maria. There was a lot off topic heat including CoRev trying to have me banned for criticizing Trump. Of course Princeton Steve tried to stay on topic defending his own unique way of counting fatalities but he did get distracted by trying to suggest the Central Park 5 actually were guilty of raping that woman runner back in the late 1980’s. A lot of fact free hysteria indeed.

      1. noneconomist

        CoRev once took me to the woodshed for laughing at Gary Cohn’s Insisting that you could take the average tax cut—$1000— and completely renovate your kitchen. (In addition to being an expert in physics, chemistry, economics , et. al., he’s also an in demand carpenter, electrician and…well, you get the idea).
        When I pointed to numerous examples of partial renovation—my own and other family—that, at minimum, had doubled that $1000, he proceeded to sing and dance his way around his previous assurances. And it went downhill from there.
        That, of course, could never top his insistence of a temporary “blip” in falling soybean (and future) prices and how Midwest farmers would not suffer from Trump tarrifs because, well, the Chinese would soon learn who they were dealing with. His comments ranged from comedy to tragedy in short order.
        As Ralph Kramden often insisted, he’s a riot. A regular riot.

  8. SecondLook

    A tiny side note about fixing engines, at least in the farming community.
    Modern farm equipment relies heavily on proprietary hardware that makes it extremely difficult to repair by oneself, or even by a local mechanic.
    For some years there has been raging anger at John Deere at how they have essentially made their tractors impossible to fix by owners.

    Ah, the joys of monopolistic capitalism…

  9. ltr

    http://www.xinhuanet.com/english/2021-07/07/c_1310047615.htm

    July 7, 2021

    Over 1.33 bln doses of COVID-19 vaccines administered in China

    BEIJING — More than 1.33 billion doses of COVID-19 vaccines had been administered in China as of Tuesday, the National Health Commission announced on Wednesday.

    [ Internationally, a number of countries are now producing Chinese vaccines with the intent on becoming vaccine self-sufficient. ]

  10. macroduck

    Roubini was mentioned, in the earlier “Great Quotes” comments, as worrying about debt ratios and supply shocks. I am not familiar with his complete analysis, but I suspect his concern stems partly from something like the BIS private credit to GDP measure: https://stats.bis.org/statx/srs/table/j?m=C. A number of economies, including that of the U.S. have swung from negative (low risk) to positive (higher risk) in recent quarters.

    If one looks at debt service, then the rise in debt may seem benign, but debt service is not the only channel of transmission for credit shocks. Mian and Sufi and company suggest that both the moving forward of demand during periods of rising household debt and wealth shocks are important links between finance and the real economy, more important than debt service.

    Residential investment as a share of GDP is rising fast but is not high compared to recent cycles. Pace of rise matters. Durable goods consumption, on the other hand, is off the charts: https://fred.stlouisfed.org/series/PCEDG. So in a Mian and Sufi world, there is a possible cause for worry about a debt-induced shock.

    I assume nobody needs guidance in identifying channels of potential wealth-induced shocks.

    1. macroduck

      By the way, the switch in the private credit to GDP to a riskier level is widespread among countries.

  11. CoRev

    Dems/liberals do amaze. On an economics blog this statement: “… national economic performance ” is translated to be be: ” GDP growth averaged….”. And the peanut gallery let this faulty analysis slide.

    Here’s another example for your class, Menzie.

    1. Menzie Chinn Post author

      CoRev: I am sorry, but this is a typical metric. If you have a preferred one, I would welcome seeing it. Would it be soybean prices, April 2018-January 2020?

      1. pgl

        My econometrics teacher would mention the number of fish in Brazil. OK he was joking and the entire class would laugh but I bet CoRev took this quip seriously!

      2. CoRev

        Menzie, “this is a typical metric.” Yup, just one of a set defining national economic performance.
        “Traditionally, the key measures of economic performance in macroeconomics include:

        Economic growth – real GDP growth.
        Inflation – e.g. target CPI inflation of 2%
        Unemployment – target of full employment
        Current account – satisfactory current account, e.g. low deficit.

        Other measures of economic performance can include:

        Government borrowing/national debt
        Real disposable incomes
        Income inequality (Gini coefficient)
        Labour productivity
        Investment levels
        Exchange rate
        Misery index (inflation rate + Unemployment rate)
        Poverty levels
        Measures of well-being – surveys which measure overall living standards. e.g. ONS well-being index.
        Human development index (HDI) – a measure of economic development. It is a composite index which includes real GDP per capita and also factors such as education, healthcare and environmental factors.”

        Of course this is from a UK source, so sensitivities may be different.

        1. 2slugbaits

          CoRev Why are you mad at Menzie for assuming sammy meant “real GDP”? Shouldn’t you be mad at sammy for using a fuzzy term like “national economic performance”? It seems to me that sammy is the one to blame here. Equating “GDP growth” with “national economic performance” seems like the most natural interpretation of an otherwise fuzzy term. If sammy meant something else (e.g., gini coefficient, exchange rate, inflation, etc.), then most fair observers would tell you that it’s incumbent on sammy to make that clear. And since sammy doesn’t appear to have objected to Menzie’s equating “GDP growth” with “national economic performance”, I can only conclude that you’re the only one who has a problem with it.

          You seem especially crotchety lately.

          And for the record, I was not born with a silver spoon in my mouth. More like good quality stainless. However, sammy’s hero Donald Trump was born with a silver spoon in his mouth. Not only that, but Trump rounded out the dinnerware set with a forked tongue.

          1. baffling

            “You seem especially crotchety lately.”
            this happens when one suddenly realizes the blame for their recent heart attack and quad bypass surgery is squarely on the poor dietary and lifestyle choices they have made throughout their life. people get crotchety when they cannot blame somebody or something else for their own failures. it creates a vicious cycle of failure and frustration.

        2. pgl

          So many items on the menu – so little time. Hey CoRev – when you go out to eat do all the waiters get tired of you spending hours making up your mind what to order?

        3. baffling

          this is a typical response from those like corev. once it appears they are losing the argument, the next step is to try and muddy the waters and create confusion. rather than simply acknowledge they were wrong to begin with.

  12. ltr

    https://news.cgtn.com/news/2021-07-07/IMF-chief-sees-risk-of-sustained-rise-in-U-S-inflation-11HT1oAVdbG/index.html

    July 7, 2021

    IMF chief sees risk of sustained rise in U.S. inflation

    The International Monetary Fund (IMF) on Wednesday said further fiscal support in the United States could fuel inflationary pressures and warned that the risk of a sustained rise in prices could require raising interest rates earlier than expected.

    Higher U.S. interest rates, in turn, could lead to a sharp tightening of global financial conditions and significant capital outflows from emerging and developing economies, IMF Managing Director Kristalina Georgieva said in a blog * published Wednesday with the IMF’s surveillance note for G20 countries.

    The IMF’s assessment of U.S. inflation risks comes amid sharp criticism by Republican lawmakers of President Joe Biden’s multi-trillion-dollar plans to boost spending on infrastructure, child care, community college tuition and expanded coverage of home care for the elderly and disabled.

    Georgieva said an accelerated recovery from the COVID-19 pandemic in the United States, where growth is seen reaching 7 percent in 2021, would benefit many countries through increased trade, but rising inflation could be more sustained than expected. The IMF forecasts global growth of 6 percent.

    Other countries face rising commodity and food prices, which are now at their highest level since 2014, putting millions of people at risk of food insecurity, the IMF said in its report.

    Market expectations suggested commodity prices would remain contained over the next few years, but inflation developments varied within advanced economies and were picking up more rapidly in Britain, the United States and the euro area, while remaining subdued in others, like Japan.

    The IMF said the global economic outlook remained uncertain given questions about the evolution of the pandemic and progress on vaccinations, as well as the possibility that the pickup in inflation would prove “more persistent” than expected.

    “While further fiscal support in some major advanced economies, including the United States, would benefit growth more broadly, it could also further fuel inflationary pressures,” the IMF said.

    A more sustained increase in prices could necessitate earlier-than-expected tightening of U.S. monetary policy, which could hit emerging and developing economies particularly hard, widening the divergence in recovery prospects.

    Georgieva repeated her call for urgent action by the G20 countries to accelerate vaccinations to high-risk populations, warning of a “worsening two-track recovery” that is leaving a large number of countries behind while the United States, China, the euro area and a few others are recovering quickly.

    Acting quickly could save more than half a million lives in the next six months alone, she said….

    * https://blogs.imf.org/2021/07/07/urgent-action-needed-to-address-a-worsening-two-track-recovery/

    2. macroduck

      “A more sustained increase in prices could necessitate earlier-than-expected tightening of U.S. monetary policy, which could hit emerging and developing economies particularly hard, widening the divergence in recovery prospects.”

      Conversely, “a less sustained increase in prices could necessitate later-than-expected tightening…which could benefit emerging an developing ecnomies…narrowing the divergence…”

      Unless there is good reason to think the median expectation is biased or that the distribution of risks is not normal, focusing on only one side of the risk distribution is unwise.

    3. pgl

      The same IMF who has lectured other nations to end all economic recovery efforts the moment something like their deficit gets a bit wee too high. NO ONE in the Biden White House should be lectured by this crowd.

    1. pgl

      Partially useful for rebutting the nonsense from our Usual Suspects. That celebrated high growth around 2007 was indeed driven by China. But take this graph back to say 1960 and it would show higher growth rates for the world from 1962 to 1969 than around 2007.

      Of course we would not to upset our Usual Suspects with actual facts – would we?

    1. Menzie Chinn Post author

      CoRev: I do understand you’re behind the curve, but the first link hasn’t been updated since 2012. The reason why the second link doesn’t have GDP is… GDP is published by BEA, while Census is publishing or co-publishing the indicators on the page you provided.

      Yes, for the uninformed and uninitiated, it would be good to say “real GDP” there; but since the 1970’s, it’s been common practice to indicate nominal GDP for GDP expressed in current dollars, and GDP is understood to mean GDP in constant/chained dollars.

    3. pgl

      Your first link does have 13 lovely charts but me thinks you missed two key things:

      (1) “The U.S. Economy in Charts
      2/29/2012”

      OK Menzie already made that point.

      (2) The entire discussion was about the mess Bush43 left us and how the policies during Obama’s first term turned things around.

      Now I’m sure you did not want to highlight the latter so do actually READ your link before posting next time!

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