Wednesday, February 19, 2014

Midweek Market Monetarist Links and Summaries - 2/19/14

(Nick Rowe) Only a subset of assets is acceptable as collateral by central banks That can put a restraint on the supply of money, which in turn leads to loss in output:
What happens when firms are aware of shocks at different times?
Chris House makes Scott Sumner's point, with microfoundations:
Nick provides three examples how capital income can respond to a recession:

Marcus Nunes highlights Doug Irwin's Article, "Who Anticipated the Great Depression?"  Mark Sadowski provides additional commentary, and James Hamilton also highlighted Irwin's article here.
Australia has safely run a CA deficit almost continuously for more than a hundred years:
Nominal targeting is replacing discussion re price targeting:
It's too easy to distort the representation for productivity and real hourly compensation:
Why monetary policy was not too easy in 2003-06, in graphs:
Monetary policy prevented a domino effect, but not the run up to the crisis:

Benjamin Cole: Labor costs have become deflationary

An illuminating post from David Glasner:

Bill Woolsey's recent response to Miles Kimball inspired several Market Monetarist posts this week:
More on Negative Interest Rates

Surely the Australian housing bubble would burst (Scott Sumner):
I predict that Steve Keen will eventually look correct
Scott explains the intuition behind his futures paper from two decades ago:
Optimal policy rules and close substitutes
It helps to have the chief economist from Goldman Sachs suggest the Fed target wage growth:
Jan Hatzius touts wage growth as a policy indicator
What matters most regarding CA deficits? The Growing Value of Sandy Countries

Scott's posts this week at Econlog:
As commenter Jon Murphy noted, "Price and quantity are not the determinants (they are the results): it's supply and demand that are the determinants:
Kevin Erdmann responds to the above link, here
These two are not the same - Obama and "brighter economic picture":

Lars Christensen provides positive news regarding Kazakhstan:
Monetary conditions have become too tight for China:

"The lesson of the last five years is that the CPI rate is not a good proxy for aggregate demand" (Britmouse)

It doesn't seem like two years (already!) since Bonnie Carr started her blog:

(Justin Irving) "How is it that Cassel is nearly forgotten while the long winded (and incomprehensible) von Mises gets his own internet cult, to say nothing of Lord Keynes sainthood?"

James Caton:

Also of interest:

"Work finally begins...when the fear of doing nothing exceeds the fear of doing it badly." So true! (Megan McCardle)

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