标题: Secular Stagnation? Engineered Depreciation or Inflation? [打印本页] 作者: choi 时间: 12-7-2013 19:04 标题: Secular Stagnation? Engineered Depreciation or Inflation? (1) My comment:
(a) Neither you nor I is an economist. So at most (if you are interested in this topic of economics at all) keep in mind of the concept, which may or may not be correct. (Most things in economics, unlike hard science, are incapable of scrutiny through rigorous experiment with control side by side.)
(b) secular (adj; Middle English, from Late Latin saeculum the present world, from Latin, generation, age, century, world):
"of or relating to a long term of indefinite duration <secular inflation>" www.merriam-webster.com/dictionary/secular
(c) The theory of secular stagnation was coined in late 1930s by AH Hansen.
Alvin Hansen
en.wikipedia.org/wiki/Alvin_Hansen
(Alvin Harvey Hansen; 1887-1975; a professor of economics at Harvard; section 3 stagnation)作者: choi 时间: 12-7-2013 19:05
(2) Pete Coy and Matthew Philips, Mr Negative. Bloomberg BusinessWeek, Nov 25, 2013 www.businessweek.com/articles/20 ... look-on-the-economy
("He didn’t offer a solution in his speech")
Note:
(a) summary underneath the title in print: Ex-Treasury boss Larry Summers says current policy isn't radical enough
(b) The article summary at table of content: Now is the winter of Larry Summers's discontent
(c)
(i) winter of discontent. http://oald8.oxfordlearnersdicti ... inter-of-discontent
(ii) Shakespeare explained:
(A) list of misquotations http://en.wikiquote.org/wiki/List_of_misquotations
("Now is the winter of our discontent")
(B) Now is the winter of our discontent: "The time of unhappiness is past * * * The 'sun of York' wasn't of course a comment on Yorkshire weather"
The Phrase Finder, undated http://www.phrases.org.uk/meanings/261500.html
(C) Samantha Markham, 'Now Is the Winter of Our Discontent' Soliloquy. Suite 101, Dec 2, 2013
("Richard’s famous soliloquy comes at the very beginning of the play. At this point, Richard is not the king, a position he does not ascend to until Act IV, he is merely Duke of Gloucester. * * * his brother Edward, who has recently ascended the throne [as Edward IV (1442-1483; reign 1461-1470, 1471-1483))
(d)
(i) The graphic of the article overlapping GDP growth change (Japan 1990-2004 and US 2005-2013) is not so uncanny as it seems. Except for Italy and Spain that have not recovered since 2007. likely UK, France and Germany display similar GDP growth change patterns. Does that buttress or debunk the theory? I do not know.
(ii) Yet Japan's deep recession in early 1990s, caused by burst of bubbles in the asset and stock market, sure looks like the Great Depression in terms of taking three years to bottom out (albeit much less severe). See
Lost Decade (Japan)
en.wikipedia.org/wiki/Lost_Decade_(Japan)
(Economist Paul Krugman has argued that Japan's lost decade is an example of a liquidity trap (a situation in which monetary policy is unable to lower nominal interest rates because these are close to zero))
(e) Coupling (non-existent) electronic dollar to devalue paper is unprecedented and untested. Devaluing internally (domestically) is somewhat distinct from doing so externally (at the foreign exchange rate). (Japan's prime minister Shinzo Abe succeeds in doing the opposite.) The only tried and true manner to devalue both internally and externally is to print money, whcih will increase national debt. Many Republicans (Ron Paul was one) have been upset with Federal Reserve chairman Ben Bernanke, because of this
(f) Transcript of Larry Summers speech at the IMF Economic Forum, Nov. 8, 2013 (posted by Randy Fellmy on Nov 19, 2013 based on the 16-minute video clip of the speech in YouTube.com). www.facebook.com/notes/randy-fel ... 013/585630634864563 http://en.wikipedia.org/wikWinter_of_Discontent作者: choi 时间: 12-7-2013 19:05
(3) Paul Krugman, Secular Stagnation, Coalmines, Bubbles, and Larry Summers. New York Times, Nov 16, 2013 (blog).
krugman.blogs.nytimes.com/2013/11/16/secular-stagnation-coalmines-bubbles-and-larry-summers/
My comment:
(a) Mr Summers' diagnosis, it sounds to me, is similar, if not identical, to Mr Krugman has advocated for years. Mr Krugman has banged his head against the wall (few listened), arguing for radical measures to resuscitate the economy. What does he have to say about Mr Summers' speech? This blog is the first shot, with a few more to follow--including one blog today.
(b) For "Curse You, Red Baron," see Snoopy
en.wikipedia.org/wiki/Snoopy
("One of Snoopy's most famous alter-egos is as the World War I Flying Ace (first appearance, October 10, 1965), often seen battling his archenemy, Manfred von Richthofen, (the Red Baron). When assuming this personality, Snoopy would don goggles, a flying helmet and a scarf and climb on top of his doghouse, which he claimed was a Sopwith Camel. The Red Baron, like other adult figures in Peanuts, was never drawn in a strip; his presence was indicated through the bullet holes that would riddle the doghouse, and Snoopy's fist-shaking and cries of 'Curse you, Red Baron!' while his 'Sopwith Camel' doghouse plummeted to earth trailing smoke. Snoopy's most famous battle with the Red Baron may be the one shown in It's the Great Pumpkin, Charlie Brown, which was the first of several animated encounters between the two")
(c) "Coalmines"? Doesn't that sound like what China has been doing for decades, digging a hole, filling it up and digging again? Come on.作者: choi 时间: 12-7-2013 19:06
(4) Free exchange | Stagnant Thinking; An old explanation for economic drift gains a new following. Economist, Dec 7, 2013 www.economist.com/news/finance-a ... g-stagnant-thinking
My comment:
(a) I am not a Keynesian, but follows Chicago school. To be specific, I am against government intervention in economics. Governor Mitt Romney was against bailing out Detroit, so he never had a chance winning over Michigan in the 2012 presidential election. That was his cross to bear.
(b) The Economist newspaper has not been so absolutist. This article pokes holes in secular stagnation.
(c) "Over to Occam"
(i) Occam's razor
en.wikipedia.org/wiki/Occam%27s_razor
(ii) Thus "over to Occam" means "We'll turn this one over to Occam and his razor."
(d) "In 2009 Carmen Reinhart of the University of Maryland and Kenneth Rogoff of Harvard University published a study of big post-war banking crises and concluded that they are typically followed by weak recoveries, whether or not they were preceded by a surge in income inequality. Just as important, central banks have been at sea since reducing their benchmark policy rates to near zero in 2008-09, to battle recession. Many economists—including Mr Summers—reckon this “zero lower bound” has kept central banks from slashing interest rates enough to get investment going and economies back on track. America has been in similar straits before, in the 1930s, when Hansen was devising his theories. Secular stagnation may someday prove a problem. The rich world’s current headaches, however, look more like a nasty hangover."
(i) Carmen M Reinhart and Kenneth S Rogoff, The Aftermath of Financial Crises. Nat Bureau of Economic Research, January 2009 (NBER Working Paper 14656) www.nber.org/papers/w14656
("The real value of government debt tends to explode, rising an average of 86 percent in the major post-World War II episodes")
(ii) Carmen M Reinhart and Kenneth S Rogoff, This Time Is Different; Eight centuries of financial folly. Princeton University Press, 2009.
press.princeton.edu/titles/8973.html
(iii) These are the "Carmen" and "Ken" in Summers transcript, "Ben" being Mr Ben Bernanke. See note (f) at (2) above.