When the Fed began paying interest on reserves in October 2008, broad money growth declined, and while it was ultimately restored, never got the chance to return to its previous trend level path.
Frances Coppola explains why the basic fundamentals of MMT come up short:
"Monetary sovereignty is perhaps best regarded as a spectrum. No country on earth is completely monetarily sovereign: the closest is the US, because of its "exorbitant privilege", but even the US cannot completely ignore the effect of its government's policies on international demand for its currency and its debt."
Also, a follow up post: "Some Governments Really are Like Households"
Could federal debt rise to 152 percent of GDP by 2048?
"Treat your students the same way you treat anyone else."
States will want to be seen as more in-charge of their economy. But neither the Right nor Left will be quite able to solve their inherent contradictions."
The "universal craving for recognition" has much to do with the forces currently shaping world events.
"The Democrats have become the party of minorities, white professionals and educated white women...while the Republicans are the white people's party. It's a moral disaster for American democracy."
"Monetary disequilibrium is not something we measure directly"
And a response from Nick Rowe: To what extent is an equilibrium defined by who shows up first in the morning?
A collision of three geographies "has no historical parallels".
To what degree is inequality associated with trust?
Ian Hathaway highlights a study on productive startup communities.
This trend would negatively "affect the ability of all cities to honor outstanding debt obligations."
"As bad as a slowdown in exports to China would be for many countries, a significant rise in global interest rates would be much worse."
"To avoid repeating mistakes of the past, policymakers should create rules that neither subsidize nor give carte blanche over government-owned rights-of-way."
Formal education is not especially well suited, for 21st century technical skills.
"The murders most associated with inequality, it seems, are driven by a lack of respect."
Scale effects aren't always as predictable as they may seem.
Healthcare: "Where will AI be useful?"
Can digital technology transform the safety net?
This old post from Tyler Cowen re Jane Jacobs, still poses some interesting issues. For instance, why didn't Jane Jacobs meaningfully address problems of scale or infrastructure?
A new initiative for "transformative placemaking".
"Fans of free markets should never be put in the position of defending regimes that are so distorted by subsidy and other regulations." "Conservatives need to remember that the "liberty" to spend or loan out government subsidized funds is not true liberty."
Will "dark store" tactics put a serious dent in property tax collection?
The "gold rush-like conditions in the Permian" have taken their toll on services and infrastructure.
Economic wealth is what we do, not some imaginary distribution of money.
It's been fifty years since Garrett Hardin published "The Tragedy of the Commons".
Mobility today mostly reinforces existing patterns.
According to this estimate, labour force participation could drop approximately 2.5% in the next decade.
Alas, We took an L-shaped recovery for granted.
When convergence gives way to divergence.
The future may include less commuting time, and more mixed use spaces.
Matthew Kahn summarizes a recent WSJ article from Paul Romer, which offers tips for growth.
"One of the fathers of AI is worried about its future."
Nintil looks at the constancy of the rate of GDP growth.
Most growth initiatives boost the level of GDP without actually increasing the long run growth rate.
"How Loneliness is tearing America apart." How might we "intentionally" invest in places we choose to live?
Britain's growing North-South divide.
Entropy as a measure of disorder, or "nature's tax".
When "potential" has been downgraded, advancement doesn't mean the same thing.
An interesting discussion between Tyler Cowen and Paul Krugman
David Beckworth has a new paper on the Fed's floor system.
Could the Fed become fiscally neutral?
A "top five" list of the year's economics books, from Diane Coyle.
One reason the U.S. is not quite ready for greater adaptation of robot technology, is the fact high school education is not oriented towards this possibility.
"In Chicago, Washington D.C., and Philadelphia, central land is about 30 times more valuable than surrounding land."
Eventually, these little robots will greatly reduce the need for agricultural fertilizers and chemicals.