What is going on in Sumner's brain?
Saturday, January 19, 2013
What Krugman said in 2008 about the Fed (in 2008)
The whole thing is interesting, but the first sentence says it all.
What is going on in Sumner's brain?
What is going on in Sumner's brain?
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Really?
ReplyDelete"The Fed has been extremely aggressive." - Krugman
"The whole economy is collapsing and the policymakers are just twiddling their thumbs!" - Sumner
"...but it hasn't been enough. It's been enough to prevent an all out screaming collapse".
DeleteCome on man. The video is right there for everyone else to watch. You can't yank out sentences like that and expect people not to call you out on it.
Daniel,
DeleteYou are drowning. One person comes over, tosses you a rope that is 10 feet too short to reach you, and walks away. Another jumps into the water with you and drags you to dry-land. Why does the fact that the first person threw you all the rope they have matter in assessing which actually helped you?
When I think of "extremely agressive" monetary policy, the largest point drop in nominal gdp ever, and the largest percentage drop in 80 years are not the first things that come to mind. Sumner is saying we evaluate the Fed based on whether or not the patient drowned. Krugman is saying we evaluate them based on whether or not they used all the rope. That you are incapable of seeing a difference between those two...
A better analogy is that someone threw you a rope, which you grabbed, but instead of pulling you out of the water, is dragging you behind the boat. Sure, you didn't drown, but you are not in much better shape.
DeleteDaniel, they sat on this footage for four years? The YouTube post says it went up in 2012.
ReplyDeleteIt's been on Big Think since 2008. I guess they just loaded it up to youtube more recently.
Delete