tag:blogger.com,1999:blog-8702840202604739302.post1452027438822259593..comments2024-03-28T03:38:53.734-07:00Comments on MacroMania: Tax policy shocks and the business cycleDavid Andolfattohttp://www.blogger.com/profile/12138572028306561024noreply@blogger.comBlogger55125tag:blogger.com,1999:blog-8702840202604739302.post-35877995628125994442012-12-14T04:52:36.409-08:002012-12-14T04:52:36.409-08:00The boom associated with an announced tax cut seem... The boom associated with an announced tax cut seems to begin only when the actual cut is implemented. Together, these two pieces of evidence make for an interesting interpretation of what caused (or at least contributed to) the early 1980s recession. <a href="http://www.china-direct.net/" rel="nofollow">buy from china</a><br />Anonymoushttps://www.blogger.com/profile/00181753070857437581noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-76302658915021641442012-08-27T04:42:37.135-07:002012-08-27T04:42:37.135-07:00This is a great post; it was very informative. I l...This is a great post; it was very informative. I look forward in reading<br />more of your work. Also, I made sure to bookmark your website so I can <br />come back later. I enjoyed every moment of reading it<br /><br /><a href="http://zander.pl/" rel="nofollow">sklep wędkarski warszawa</a>Anonymoushttps://www.blogger.com/profile/14676158430899477474noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-88778094457601043062012-06-02T11:45:59.228-07:002012-06-02T11:45:59.228-07:00Laffer maintains that we may increase spending bec...Laffer maintains that we may increase spending because of dynamic scoring, as tax receipts rise, always, when you cut taxes.<br /><br />Again, have we got agreement on Laffer or not?<br /><br />The lower bond rates would be Chinese corporations. :<)<br /><br />Can you figure out why?Anonymoushttps://www.blogger.com/profile/07904132869021579763noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-19949793613368051202012-05-30T22:06:27.614-07:002012-05-30T22:06:27.614-07:00So, when the US cuts taxes, interest rates go up, ...<i>So, when the US cuts taxes, interest rates go up, since people doubt that the government will pay off its debts. <br /><br />Glad we finally got rid of Laffer</i><br /><br />Where is Burr when you need him?<br /><br />Cutting taxes whilst maintaining program spending in place invites default (unless there is a large foreign appetite for Treasuries, in which case, the added debt can be rolled over indefinitely at almost zero carrying cost).<br /><br />Default would cause interest rates on Treasuries to go up, for sure. But interest rates on corporates may actually decline. Can you figure out why?David Andolfattohttps://www.blogger.com/profile/12138572028306561024noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-76740738258095936042012-05-30T11:40:01.905-07:002012-05-30T11:40:01.905-07:00So, when the US cuts taxes, interest rates go up, ...So, when the US cuts taxes, interest rates go up, since people doubt that the government will pay off its debts. <br /><br />Glad we finally got rid of Laffer<br /><br />That is what Robert H. Dugger calls Fiscal Adjustment Cost discounting (Bob gets out over his skis, sometimes, but he does a good job explaining his reasoning on this point).<br /><br />Seems like you just signed on to what we should call the Hamilton Plan II, for which I advocated above, that Obama should go for:<br /><br />A real plan, over 30 to 40 years, to raise taxes to pay off the Federal Debt, which will keep rates low and permit private investment to start to borrow, now.<br /><br />http://www.hanoverinvest.com/pdf/HHIGComment110525_Paul_Krugman.pdf<br /><br />What further messages do you see in capital not being willing to buy stocks, even those that offer yields above 1.6713%?Anonymoushttps://www.blogger.com/profile/07904132869021579763noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-22529447726501292622012-05-30T10:07:13.503-07:002012-05-30T10:07:13.503-07:00That no one trusts the government to keep its hand...That no one trusts the government to keep its hands off private sector income and wealth through higher future taxes. Since higher future taxes support the value of government bonds, this is what people flock to.<br /><br />Got it?David Andolfattohttps://www.blogger.com/profile/12138572028306561024noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-89187339724058732722012-05-30T07:08:35.074-07:002012-05-30T07:08:35.074-07:00Sovereign Bond Yields Falling All Over The Place: ...Sovereign Bond Yields Falling All Over The Place: Here's The REAL Story Of What's Happening To Government Bond Markets Around The World: Yields are shooting higher in Spain and Italy this morning, but actually that obscures the truth about what's going on in the government bond department. The fact of the matter is that yields are plunging left and right.<br /><br /> The yield on the US 10-year bond has just fallen below 1.7%. UPDATE: the yield has just hit 1.6713%, a brand new record low.<br /> In Germany, the 10-year has fallen to a new record of 1.33%.<br /> UK borrowing costs have hit a record low of 1.73%.<br /> In Finland, the yield on the 10-year is 1.624%. You guessed it, that's a record low.<br /> Sweden: The 10-year yields 1.405%. Same deal.<br /> In Australia, the 10-year has dropped close to a record low of 3.061%.<br /> Canadian 10-year yields at 1.87% are close to a record low.<br /> Japan's 10-year: 0.85%.<br /> Swiss 10-year: 0.59%.<br /><br /> Get the point?<br /><br /> All around the world, people are clamoring for the safety of government debt...<br /><br />David, what's the message?Anonymoushttps://www.blogger.com/profile/07904132869021579763noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-34348170157955603162012-05-29T09:38:37.209-07:002012-05-29T09:38:37.209-07:00John D, David may be entertaining your insanity fo...John D, David may be entertaining your insanity for the moment, but he knows it's you. You may as well go home and play with the other cranks, we're not buying your crazy here.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-45027461726413951252012-05-28T05:26:26.275-07:002012-05-28T05:26:26.275-07:00Chernow's Hamilton confirms that, when Hamilto...Chernow's Hamilton confirms that, when Hamilton's plan to pay off the national debt was passed by the First Congress, and included raising taxes during a Depression. The immediate effect of the Plan was an economic boom because it signaled that we had a serious national government.<br /><br />No one ever talks about this, but Hamilton's point of view attacks the same problems that Keynes saw but in a different way. Government is the solution, to be sure, but it is strong government action, not weak government action.<br /><br />If one, for example, looks at "austerity," now in either GB or Europe, no one could argue that it is serious austerity, intended to make anyone fell safe or secure. It does not meet Hamilton's test of being sufficient to restore confidence.<br /><br />Isn't what we really need a signal to everyone, the Markets, the World, that we are a serious people again?<br /><br />Your thoughts? <br /><br />What would your models tell us would happen if we went to a Hamilton plan right now, raising taxes sufficient to pay off the national debt in 30 to 40 years? What if we took that step combined with elimination of income taxes, replacing such with a VAT, and a health care system like Switzerland or Germany that would lower health care cost, and its mis-allocations of resources, from 18% to 11% of GDP?<br /><br />Why wouldn't we get an immediate Hamiltonian boom?Anonymoushttps://www.blogger.com/profile/07904132869021579763noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-21655826957213813342012-05-26T14:03:06.207-07:002012-05-26T14:03:06.207-07:00thanks, although its hard to let go of the"se...thanks, although its hard to let go of the"ser ice economy is unproductive we dont make stuff in the US" rhetoric, i find it irritatingly ill-informed especially when i dont even have to remember where i read stuff anymore i can just google service sector productivity. how do we measure the productivity contribution of google and FRED to the service economy btw? lol.dwbnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-7477866590020229892012-05-26T09:32:29.634-07:002012-05-26T09:32:29.634-07:00dwb...anonymous above is a troll; please ignore hi...dwb...anonymous above is a troll; please ignore him. And thanks, by the way, for your excellent contributions!David Andolfattohttps://www.blogger.com/profile/12138572028306561024noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-91886990180777824852012-05-26T09:20:48.726-07:002012-05-26T09:20:48.726-07:00incidentally, "Anonymous," if you have n...incidentally, "Anonymous," if you have not read the PK article in the FT heres a link:<br /><br />http://www.ft.com/intl/cms/s/2/022acf50-a4d1-11e1-9a94-00144feabdc0.html#axzz1vzXFh4mz<br /><br />I agree with the part where he says (some other parts as well):<br /><i><br />" So what, I wonder, would he do if he were put in charge? He says he would add maybe another $2tn to the Fed’s balance sheet, by purchasing a wider range of assets, including more private sector liabilities. “But mostly”, he continues, “you work on the expectations side. I think mostly what you really need to do is to signal that you’re going to keep your foot on the gas pedal.”<br /><br /> It does not even matter, he believes, if people are not sure the Fed will carry through. They just have to believe it might happen. “So if Ben Bernanke made a statement, or the board made a statement, saying that we are reconsidering our views about the inflation target, even if we don’t have a credible commitment that they’re going to deliver 3.7 per cent annual inflation over five years, that’s still a help.”<br /><br /></i><br /><br />I agree with some other parts as well. It might sound like a technical difference, but the part where i would disagree with PK is that <i>inflation expectations</i> are not the expectations that we need to set (expectations for nominal income are better).<br /><br /><br />my point is that just because reasonable disagree with PK on some issues, does not mean that those same people cannot agree with PK on other issues.dwbnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-90922089638189160302012-05-26T09:08:09.857-07:002012-05-26T09:08:09.857-07:00Attack him and you implicitly attack all his thoug...<i> Attack him and you implicitly attack all his thoughts and ideas, making you the enemy by your choice. </i><br /><br />a remarkably stupid thing to say. PK is sometimes right and sometimes wrong and reasonable people can disagree. <br /><br />Can we starts with some facts please not dull rhetoric? Is that how you win cases, without evidence? Could you at least bother to check some simple facts?<br /><br />Here are some facts:<br /><br />* We exported 2 Tn dollars in 2011 (which is offset by imports, a huge chunk of the difference being crude oil). We export stuff to china (mostly capital goods). <br /><br />*"service worker" productivity has increased 1987-2010 (see BLS statistics below). Even in "food service and drinking places" its gone up .7% per year.<br /><br />*The total value of manufacturing has gone *up* and is higher than 2006 in both real and nominal terms. The number of employees in manufacturing has gone down because productivity has gone up.<br /><br />trade balance report: http://www.bea.gov/newsreleases/international/trade/2012/pdf/trad0312.pdf<br /><br />(look at the breakdown of exports exhibit 6, did you realize we export about 35 Bn dollars of auto equipment??)<br /><br />exports to china going up: <br />http://research.stlouisfed.org/fred2/series/EXPCH<br /><br /><br />value of manufacturing (real and nominal):<br />http://research.stlouisfed.org/fred2/graph/?id=AMTMVS#<br /><br />productivity 1987-2010:<br />http://www.bls.gov/news.release/prin1.t02.htmdwbnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-43171897630721635102012-05-26T07:40:04.533-07:002012-05-26T07:40:04.533-07:00David, your denials won't work. Repeatedly, yo...David, your denials won't work. Repeatedly, you and SW have attacked Krugman. Attack him and you implicitly attack all his thoughts and ideas, making you the enemy by your choice. SW is constant in his Laffer line.<br /><br />David writes, "I am for reasoned debate."<br /><br />David, three comments.<br /><br />First, your attacks on Krugman haven't been reasoned. He is right and you are wrong.<br /><br />Second, you are alone and by yourself in wanting a reasoned debate. No one else is, especially the GOP adn Tea Party and they are not about to change. Taylor, Lucas, Cochrane, the Chicago/Freshwater axis is not about reasoned debate.<br /><br />Third, David, the reasoned debate horse has already left the barn. Do you think you can have reasoned debate with the GOP or Tea Party. Read Delong's recent posts. <br /><br />Maybe 50 years from now in China someone will care about reasoned debate in economics, but never more here in the good ole USA.<br /><br />Events are already so out of balance that reasoned debate will never happen, here, if it ever did, in your or my life time.<br /><br />Just a few more Congressmen or Senators this fall, for example, and we will no longer have a Fed. In fact, my bet is that the Tea Party/Ron Paul will demand elimination of the Fed as a price for any debt ceiling extension. If I were in their political position, that is what I would do.<br /><br />In sum, you are just so naive.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-70766281320492919952012-05-25T18:27:22.811-07:002012-05-25T18:27:22.811-07:00Where you and SW are wrong, however, is to oppose ...<i>Where you and SW are wrong, however, is to oppose Krugman, saying there is a threat of inflation.</i><br /><br />Where have I said this? If anything, I keep on saying that as long as the world demand for USD and UST remains strong, inflation is not an immediate threat (although, I would always add too, that a central bank must always keep it's eye on inflation expectations). <br /> <br /><i>The enemy in all of this is the Taylor, Cochrane, Chicago School axis, with whom you and SW continue to align, forgetting that in times like these you are either with us or against us.</i><br /> <br />I am for reasoned debate. I guess that makes you my enemy.David Andolfattohttps://www.blogger.com/profile/12138572028306561024noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-28385061637698206122012-05-25T17:21:51.481-07:002012-05-25T17:21:51.481-07:00David,
I wholly fail to understand why you believ...David,<br /><br />I wholly fail to understand why you believe I would be embarrassed by your response.<br /><br />Of all the people you stop by here, I am quite confident that no one feels more strongly about productivity than do I. I like your paper. It makes a great deal of sense to me, given what I have read about Japan since 1990.<br /><br />I am very sure that my thoughts and feelings are stronger than yours, for I have real first hand knowledge and have been a keen observer for many years.<br /><br />As I have written more than once, never very well perhaps, I believe this is our fundamental problem, to the extent that I believe than an economy that is 85% plus services cannot sustain itself, for it cannot be productive enough.<br /><br />I have continually tried to say that Krugman (and Delong) are too one dimensional. Printing money, while it will not cause inflation, is not enough, not nearly enough to solve our problems. Keynes is so badly mistreated. Keynes would be the first person to say that the key, always, to the future, is productivity.<br /><br />That is a point in his famous quotation about you need the government to support the average business, to help it gain confidence, so that it can again be productive!!!<br /><br />Where you and SW are wrong, however, is to oppose Krugman, saying there is a threat of inflation. <br /><br />Krugman, I am sure, would fully support most any sane or reasonable effort to increase productivity.<br /><br />You seem to see this last question differently. Why?<br /><br />The enemy in all of this is the Taylor, Cochrane, Chicago School axis, with whom you and SW continue to align, forgetting that in times like these you are either with us or against us.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-62932868084271815282012-05-25T08:13:59.838-07:002012-05-25T08:13:59.838-07:00Anonymous,
Why don't you read this, where I s...Anonymous,<br /><br />Why don't you read this, where I state my views of the Japanese economy in the early 2000s, and compare and contrast them with Krugman's. Then get back to me. (Oh, and try not to be too embarrassed, if that emotion is even possible for you.)<br /><br />http://www.imes.boj.or.jp/research/papers/english/me21-4-1.pdfDavid Andolfattohttps://www.blogger.com/profile/12138572028306561024noreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-75866674199174202382012-05-25T05:42:58.884-07:002012-05-25T05:42:58.884-07:00David,
Today, Krugman correctly points out that b...David,<br /><br />Today, Krugman correctly points out that both you and SW have been doing nothing but channeling Art Laffer.<br /><br />http://krugman.blogs.nytimes.com/2012/05/24/enter-laffering/?pagewanted=all<br /><br />Enough time has now passed that Krugman is in full, "I told you so" mode.<br /><br />David, let me echo his remarks to you. I told you so.<br /><br />And, BTW:<br /><br />Let me add, for the 1.6 trillionth time, we are in a liquidity trap. And in such circumstances a rise in the monetary base does not lead to inflation.<br /><br />You have constantly and wrongly gone after Krugman.<br /><br />Lets put in it black/white: Are we in a liquidity trap?<br /><br />If not, why do you say, "Not?"<br /><br />And, if you don't answer we will take that as an admission that Krugman is right (and that you are wrong in every way about him).Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-31775962148139064122012-05-24T19:51:29.567-07:002012-05-24T19:51:29.567-07:00i looked up on the BLS website pay scales for engi...i looked up on the BLS website pay scales for engineering degrees, not nearly as glum as you suggest. thank god for facts. you can make $100k as an engineer (yes i know we cannot all be above average). <br /><br />maybe we ought to keep those math scores up, Anonymous.<br /><br /><br />http://www.bls.gov/oes/highlight_arch_eng.htmdwbnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-46192846033694633572012-05-24T17:59:46.702-07:002012-05-24T17:59:46.702-07:00I have been thinking about this (actually my siste...I have been thinking about this (actually my sister is a lawyer), first, you have a skewed perspective. Second, honestly, i dont want criminal justice to be very efficient. The criminal code is too large and we criminalize too many things. Unless your idea of justice is "Minority Report." I ban cell phones at meetings sometimes, too many distractions. <br /><br />Nothing in your argument has anything to do with economics or is really applicable to other service industries.dwbnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-59204882984210000862012-05-24T16:07:20.937-07:002012-05-24T16:07:20.937-07:00so you think LexisNexis and other search/database ...so you think LexisNexis and other search/database technologies have not improved the productivity of lawyers??<br /><br />no, not significantly. In fact, for a great deal of research it takes longer.<br /><br />Broad searches return too much and narrow searches, nothing. There is no consistently in language. One judge will write, "tacit representation." A different judge will call the same facts "implied misrepresentation."<br /><br />What has helped a little is that Google has a lot of older books now on Google Books.Since older opinions are better reasoned and researched, and not twisted by ideology, they are more useful.<br /><br />You pull the book and read it, almost like in a library.<br /><br />Beyond that, as I said, you are pretty dull. Amazingly few criminal cases involve DNA or fingerprints.<br /><br />The criminal law practice is a serious of frictions, unchanged by technology. Clients lie. Prosecutors and police lie and hide evidence. Witnesses refuse to talk about what happened. And, judges act like Judge Judy, which is a really toxic environment. Courtrooms are poorly designed. Federal courts, for example, frequently will not permit cell phones and lap tops and have no internet service.<br /><br />You really have no idea what you are talking about.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-44718914946318186422012-05-24T13:55:19.198-07:002012-05-24T13:55:19.198-07:00trying to get other people to pay for my stuff doe...trying to get other people to pay for my stuff does not sound retarded at all. i dont want more necessarily, but maybe i could get someone to pay to replace some stuff with different stuff.dwbnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-6823262827729938712012-05-24T12:31:56.808-07:002012-05-24T12:31:56.808-07:00Everyone,
Anonymous is actually John D, a borderl...Everyone,<br /><br />Anonymous is actually John D, a borderline retard lawyer from the Midwest who thinks he deserves more stuff just because he wants it. And he particularly wants rich people to pay for his extra stuff. Ignore him.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-462696616257554742012-05-24T09:25:07.386-07:002012-05-24T09:25:07.386-07:00ok, sorry 1 more: i think i am being too clever by...ok, sorry 1 more: i think i am being too clever by half.<br /><br />fundamentally what i am saying is that the Fed cannot promise to hold down import prices (those are determined on world markets). yet it does promise that! <br /><br />The main way they hold down import prices like oil is by causing massive unemployment (that sure depresses demand for imports!). Thank god they hold down those import prices for us so us working people can afford imports. <br /><br />Seriously: The fed can only control domestic prices. The fundamental solution to what you are complaining about vis-a-vis the trade balance is to depreciate the dollar to where imports become expensive. The only way we will consume less oil and buy more fuel efficient cars and import less from China is if its more expensive.dwbnoreply@blogger.comtag:blogger.com,1999:blog-8702840202604739302.post-75529485597604046662012-05-24T09:13:15.632-07:002012-05-24T09:13:15.632-07:00btw you are not addressing the issue: isnt printin...btw you are not addressing the issue: isnt printing a truckload of Ben Bernanke Bills just like raising taxes on everyone in the 1% group (just asking, not suggesting this is a good plan)?dwbnoreply@blogger.com