Krugman’s blog, 9/30/15

There were four posts yesterday.  The first was “Tontines Explained:”

Trying to drag myself back to the real world — although my head still feels stuffed full of cotton. But I did want to weigh in on a Wonkblog piece from a couple of days ago about the possible virtues of tontines — retirement schemes in which the payouts go only to surviving members of a group. The article does reference a Simpsons episode; but surely we can’t tackle this subject without mentioning the movie The Wrong Box, with a plot that hinges on two brothers who are the sole survivors of a tontine. Here’s how the rest of the group went:

That’s one of the funniest movies ever made.  If you haven’t seen it, hie thee to Netflix…  Yesterday’s second post was “Commodities and Cranks:”

Does anyone remember the heyday of the inflationistas, when they were berating Ben Bernanke for debasing the dollar? One of their key arguments was that commodity prices were rising, and that this was a harbinger of soaring overall inflation.

So now, the same people are worried about deflation, and urging Janet Yellen to keep her pedal to the metal. Right? Right?

Funny how that doesn’t happen.

The third post yesterday was “Jeb Goes Galt:”

This is amazing:

“I think the left wants slow growth because that means people are more dependent upon government,” Bush told Fox Business’ Maria Bartiromo.

Remember, this is the establishment candidate for the GOP nomination — and he thinks he’s living in Atlas Shrugged.

They all do.  They’re the mole people.  And pray God they ALL “go Galt” so we don’t have to deal with them any more.  Yesterday’s last post was “The Fed Puzzle:”

OK, maybe it’s the ear infection, but I’m having a very hard time understanding what Peter Gourevitch is saying in this article name-checking me. Stuff is complicated? What?

In any case, however, Gourevitch seems to have missed a crucial point about my puzzlement over the Fed’s eagerness to raise rates. I’m not saying “I’m smart, so why aren’t they listening to me?” Yes, people can have different views about how the world works.

But the strange thing here is that as far as anyone can tell, the people inside the Fed who are eager to hike and the people outside the Fed who think it’s premature have more or less the same economic models in their heads. It’s not just me; Larry Summers, the IMF (presumably reflecting Olivier Blanchard), the World Bank, and more are aghast at the urge to hike; and the thing is, all of the outsiders come from the same Cambridge 1970s updated Keynesian school of macro as the key insiders. Most of us were Stan Fischer’s students!

So we’re trying to understand why the insiders have such a different view of appropriate policy from the outsiders when their intellectual apparatus is the same. If you don’t get that, you’re missing the point.



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