71–80 of 112 posts
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It sounds like they grilled him until they got co-authorship for a paper with a with an uber high impact factor.
Is it good for your career to get high impact factor for a paper that admits that your most famous work was a fraud that destroyed the economy of several nations?
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who on earth thought austerity was ever a good idea? Lots of sensible people. The point of austerity is to stop spending money you don't have on stuff which does not clearly contribute to economic improvement. Every increase in debt must be balanced with a reasonable objective expectation that it will facilitate specific & significant increase in revenue greater than the debt and servicing thereof. If you've spent yo…
It's actually not sensible to assume that basic principles apply to things that are complex and subtle. For example, a basic principle for centuries was that metal is too heavy to float, therefore it was clearly too heavy to fly. Simple, basic, and completely wrong - see for example today's airplanes. This is not to say that the opponents of austerity must have it all figured out, but rather that history has not been…
Apparently "don't spend money you don't have on negative-return investments" isn't common sense.
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Sensible people like Paul Ryan? Now, that's rich.
What's wrong with Paul Ryan?
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Depends what your borrowing situation is. During the financial crisis, irrespective of our level of public debt, the bond rates were actually such, that people were basically PAYING the federal government to borrow money. Instead, we had politicians on an austerity tear, and ranting about how we needed to reduce the national debt. We could have borrowed a big chunk of money, earned the interest off of it, and then ju…
Yes they say it, but the opposing party opposes it. The Democrats most certainly do not wish to run the government as business but as more of a piggy bank that someone else fills each night. Therefore, even if the Republicans wanted to do such a thing they likely cannot. But, as you say, they haven't been very serious about such an idea for quite a while.
The broader point is that nobody actually wants to run the Government like a business (nor is that necessarily a good idea in aggregate). But even at the points where it makes sense for the government to behave in a business-like manner (and there are some), we do not and cannot get our shit together to do so.
You would be surprised how many things that exist around you are based around faulty models based on incorrect data - that's the problem with higher dimensional fields like economics and finance - it's hard to separate cause and effect and extract principal signals for an arbitrary phenomena, without getting bogged down in correlation hell. You have been warned - the further fields get from pure mathematics and isola…
who on earth thought austerity was ever a good idea? Lots of sensible people. The point of austerity is to stop spending money you don't have on stuff which does not clearly contribute to economic improvement. Every increase in debt must be balanced with a reasonable objective expectation that it will facilitate specific & significant increase in revenue greater than the debt and servicing thereof. If you've spent yo…
You make the common mistake of assuming macroeconomics is just microeconomics at scale. A national economy isn't just a really big household.
There has been no correlation between public debt ratios and the Great Recession or its recovery. The Recession was not triggered by high debts, it has not affected countries with higher debts more severely than countries with lower debts, and attempts to reduce debts since the Recession have resulted in slower growth and - oops - higher debts.
You would be surprised how many things that exist around you are based around faulty models based on incorrect data - that's the problem with higher dimensional fields like economics and finance - it's hard to separate cause and effect and extract principal signals for an arbitrary phenomena, without getting bogged down in correlation hell. You have been warned - the further fields get from pure mathematics and isola…
>Also - who on earth thought austerity was ever a good idea?
Who on Earth thought spending was ever a good idea?
>The US should load up on as much debt as possible
This is ludicrous. How on Earth would you pay it back? The only way you could justify such spending is if it created more wealth than the amount of debt and interest. Which depends entirely on where the money is spent. Just creating new roads and bridges may produce some value to the economy, but it's no where near enough to justify it (and in the end most of it would have to be taxed back of course, to pay for the debt and interest.)
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Sensible people like Paul Ryan? Now, that's rich.
Faulty generalization: Paul Ryan is not sensible, so everyone who agrees with him on anything must also be unsensible.
You would be surprised how many things that exist around you are based around faulty models based on incorrect data - that's the problem with higher dimensional fields like economics and finance - it's hard to separate cause and effect and extract principal signals for an arbitrary phenomena, without getting bogged down in correlation hell. You have been warned - the further fields get from pure mathematics and isola…
This is what Austrian economists have been arguing forever. They base their models on simple assumptions. Trying to figure out how an economy works just by observing it's macro behavior is insane. There are so many factors, economic models change over time as market actors use them to make decisions, and the sample size is incredibly small (not many countries to look at) and biased (differences between countries are…
Oh, I'm sorry, I thought I was supposed to sound like an Austrian "economist".
You would be surprised how many things that exist around you are based around faulty models based on incorrect data - that's the problem with higher dimensional fields like economics and finance - it's hard to separate cause and effect and extract principal signals for an arbitrary phenomena, without getting bogged down in correlation hell. You have been warned - the further fields get from pure mathematics and isola…
who on earth thought austerity was ever a good idea? Lots of sensible people. The point of austerity is to stop spending money you don't have on stuff which does not clearly contribute to economic improvement. Every increase in debt must be balanced with a reasonable objective expectation that it will facilitate specific & significant increase in revenue greater than the debt and servicing thereof. If you've spent yo…
You would be surprised how many things that exist around you are based around faulty models based on incorrect data - that's the problem with higher dimensional fields like economics and finance - it's hard to separate cause and effect and extract principal signals for an arbitrary phenomena, without getting bogged down in correlation hell. You have been warned - the further fields get from pure mathematics and isola…
First of all, spending a lot of money only helps solve an aggregate demand problem. It's not clear that it is (or at least not entirely an aggregate demand problem). Economies can have many problems, some deep, some subtle, some ephemeral. Some problems are plausibly solved through spending, and some are not. Sometimes, people talk about economics as though they could apply Keynesian principles in Somalia and it would be a thriving economy in 5 years. It's not that simple.
Second of all, 1-2% interest sounds great, and like a good opportunity to do some infrastructure projects. However, we have to consider that the debt is not stable now. Given a trillion dollar deficit, that 1-2% money is going to be borrowed anyway. We don't necessarily want to borrow it now, because it could make it more expensive to borrow the money in the future that we already know we need to borrow.
Third, people don't necessarily trust economists. Economies are complex, and a bunch of smart people saying they have the answers is not convincing to many people. On its face, a statement like "borrowing and spending and consuming are good for the economy" sounds like something for nothing, and triggers skepticism more so than "saving and investing is good for the economy". Even if the principles are sound, people don't trust the implementation, which is sure to be twisted for political gain. A trillion dollars being spent brings people out of the woodwork to manipulate it to their advantage, perhaps sacrificing the country in the process.
Last, many people see that a lot of borrowing, spending, and consuming have been happening over the last decade or so; and we still have problems. It's only natural that people are considering a change of direction that involves less borrowing and spending and consuming.