Last year’s recap was subtitled “Ascent of the Blowhards”. Let’s hope the triumph is only temporary, and rational policy analysis once again becomes a valued commodity.
Category Archives: Uncategorized
Sound and Fury Signifying…? Mulvaney to OMB
Economic Report of the President, 2017
When Tax Cuts Meet Mass Deportations
As we get more clarity on the nature of fiscal and mass deportation policies under a Trump Administration, it seems useful to consider what happens to the output gap.
Further Dollar Appreciation?
As noted in my last post, the collision of expansionary fiscal and counter-cyclical monetary policy will result in an appreciated dollar. How much more appreciated?
Guest Contribution: “What Will the Trump Presidency Look Like?”
Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers. A shorter version appeared on November 9th in Project Syndicate.
Thank Goodness We Solved that Problem of Elevated Economic Policy Uncertainty Depressing Growth!
As of today, measured economic policy uncertainty hit 468.
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At Long Last, the Feared (Portfolio) Crowding Out Has Materialized
The implication of a (massive) revision to the expected path of government debt relative to baseline is an increase in the slope of the yield curve. Some portion comes from the expectations hypothesis of the term structure, some from an increase in the risk premium. [lecture notes on portfolio crowding out] [lecture notes on expectations hypothesis of term structure]
Figure 1: Yield curve as of 8 November (blue), and 9 November (green). Source: US Treasury.
The Trilemma, Nuanced
I’ve just finished up the Mundell-Fleming model in my int’l finance course, and ended the section with a discussion of the “International Trilemma”, also known as “the Impossible Trinity”, which states that a given country can at any given time fully achieve only two out of three objectives of exchange rate stability, monetary autonomy, and financial integration (full capital mobility) at a time.
Rookie Economist Errors II
Yet more cautionary notes for my students.