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Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

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Re: Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

#111

Post by hawkesnest »

mindcrime wrote: post #87

“The economy is already at full employment.” I'm not sure that's actually true. Yes, the govt. reported "official" unemployment number is 3.8% or whatever. BUT... that comes with a couple of big, big caveats: 1. Those numbers by definition don't include job-seekers who have left the market and quit being job-seekers. IOW, people who became so despondent that they gave up. But, there's nothing specific that stops thes…

But problems 1 and 2 are the same for the official unemployment metric in times past as well.

1. If the person has stopped looking for a job, their likelihood of resuming their job-seeking is pretty low. That's especially true for the unusually large aging baby-boomer population who are taking an early retirement rather than seeking re-employment.

2. While that's clearly another indicator of the strength of the job market, it is hard to argue that no job is better than a job which isn't ideal for skill/pay reasons. If you have a suggestion on how to accurately measure this that'd be great.

Who knew that a single number was insufficient to measure something as complex as employment? Yeah, we need to look at the larger picture, but it's hard to say we have exceptionally low unemployment AND that this is a good time for a stimulus.

Re: Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

#112

Post by samsonradu »

bradyseason wrote: post #106
smallnamespace wrote: post #5

The combination of tax repatriation, tax cuts, and large-scale deficit spending (fiscal expansion) late in the economic cycle (recessions typically happen every 8 years or so, and the current expansion has been going on for ~10 yrs now) while the Federal reserve is raising interest rates (monetary 'contraction') is more or less unprecedented (we've never seen it happen in modern times in the US or any other large dev…

Bernanke is the fed chairman so he obviously knows something that most of us don't. But from some analysis, it seems that US will be in good shape for the next 10-20 years. US is currently in capable hands economically since it is lead by a businessman and surrounded by financial experts from wall street. (I don't approve of Trump's character). Some factors for US's continued growth: healthy demographics - due to imm…

> US is currently in capable hands economically since it is lead by a businessman and surrounded by financial experts from wall street. (I don't approve of Trump's character).

All presidents are surrounded by financial experts. Also the ‘financial experts’ did a lot of mistakes and mispredictions through history, not sure if your point stands.

Having a businessman for president is arguably good, a country is not a business.

Re: Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

#113

Post by megaman22 »

ams6110 wrote: post #93
maxxxxx wrote: post #66

Earlier quoted context omitted.

" 2020: policies put in place under this administration will come home to roost during the next administration, which will get the blame." That has often been the case. Bush suffered through Clinton's internet bubble. then Obama suffered through Bush's real estate bubble. Trump now benefits from Obama's policies. We'll see what happens after Trump.

Trump benefits from Obama's policies by reversing them.

It's startling what the growth on my 401k has done since November 2016. Essentially flat for years before, then immediately jumping, once the election results were in. Q1 2018 was a bit sluggish, but it's back on that tragectory again.

Even outside the market, people are hiring again, companies are making investments, it's a hell of a turn around.

Re: Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

#114

Post by icu »

roma1n wrote: post #52
Clubber wrote: post #33

Earlier quoted context omitted.

It diminishes wealth.

And debt; and favors work. Seems like a very good thing in moderate amounts.

It only diminishes debt if your ability to service that debt outstrips the rate of inflation. If your ability to service debt does not grow in line with inflation, you are in no better state.

Re: Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

#115

Post by frgtpsswrdlame »

mindcrime wrote: post #76
wjn0 wrote: post #3

When I read articles like this I wish I had a better grounding in economics, I guess specifically macroeconomics? Is there a well-known, digestible textbook?

Basic Economics - Thomas Sowell https://www.amazon.com/Basic-Economics-Common-Sense-Economy/...

^ Not this one. Mankiw is already ideological enough, Sowell and Hazlitt should be stayed far away from. The real answer to the above commenter is that you can't, not really. You can put a lot of work into understanding Mankiw and then you go to econ grad school and learn all the caveats and how much of it is basically wrong. Economists themselves barely understand the economy and they spent years and decades getting to 'barely.' A layman is basically incapable.

In that sense maybe I'm wrong and maybe Sowell is the good choice, just decide your ideological viewpoint on the economy now, read enough to defend your viewpoints to other laymen and let that be that.

Re: Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

#116

Post by beiller »

Bucephalus355 wrote: post #10

Ben Bernanke’s point in his recent memoir is that central banks can only do so much. At the end of the day, monetary policy is not social change, moral evolution, or political coalition building. These things happen outside the Central Banking system and are just as important for a functioning economy. I know this sounds controversial, but at this point quite frankly the deficit does not matter. There is so much debt…

I've heard that its more likely we will see massive inflation ramp up. And since the debts are all fixed interest rates at the time of borrowing, they will be inflated away to nothing, not "written off".

Re: Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

#117

Post by bdamm »

mindcrime wrote: post #87

“The economy is already at full employment.” I'm not sure that's actually true. Yes, the govt. reported "official" unemployment number is 3.8% or whatever. BUT... that comes with a couple of big, big caveats: 1. Those numbers by definition don't include job-seekers who have left the market and quit being job-seekers. IOW, people who became so despondent that they gave up. But, there's nothing specific that stops thes…

Do you know how the government might acquire the data you're looking for? #3 is easy, #1 and #2 seem more in the domain of private surveyors that are more like pollsters and taking voluntary data sets to proxy the big picture. That has its own problems, of course.

#3 is clearly happening in tech.

Re: Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

#119

Post by creaghpatr »

adventured wrote: post #82
salviasloth wrote: post #72

Earlier quoted context omitted.

Clintons internet bubble?

During the second half of the Clinton Admin, there was an extreme stock market bubble, which began to crash at the end of his second term. Bush inherited a guaranteed recession, and then 9/11 occurred on top of that context. Which then led the Fed to make stupid mistakes on interest rates, which helped spur immense asset inflation in the real estate sector, which then collapsed, which led to the great recession, whic…

100% agree, I'd put the blame on the Fed before Trump, Obama, Bush, or Clinton. If I had to choose it would be Bush for being president when TARP was passed but really the blame there falls on the Congress.

Re: Bernanke Says U.S. Economy Faces a ‘Wile E. Coyote’ Moment in 2020

#120

Post by mindcrime »

hawkesnest wrote: post #111
mindcrime wrote: post #87

“The economy is already at full employment.” I'm not sure that's actually true. Yes, the govt. reported "official" unemployment number is 3.8% or whatever. BUT... that comes with a couple of big, big caveats: 1. Those numbers by definition don't include job-seekers who have left the market and quit being job-seekers. IOW, people who became so despondent that they gave up. But, there's nothing specific that stops thes…

But problems 1 and 2 are the same for the official unemployment metric in times past as well. 1. If the person has stopped looking for a job, their likelihood of resuming their job-seeking is pretty low. That's especially true for the unusually large aging baby-boomer population who are taking an early retirement rather than seeking re-employment. 2. While that's clearly another indicator of the strength of the job m…

But problems 1 and 2 are the same for the official unemployment metric in times past as well.

Absolutely. Don't get me wrong... I'm not arguing for or against any specific policy in the post above, or making any particular claim regarding Bernanke's argument. I just wanted to point out that saying "we're at full employment" is at least a little bit questionable as an assertion, at least if we take "full employment" to represent a situation where lack of available labor represents a threat to the economy, vis-a-vis other policy issues.

Maybe I'm just picking nits with this observation, but that jumped out me for some reason, when I was reading the article.

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