Finance Basic To Advance Level Knowledge

My latest Macro Musings podcast is with Greg Ip, chief economics commentator for the Wall Street Journal. We covered a number of topics including how he got into macro journalism (his mom was a central banker and Nick Rowe was one of his college teachers!), his new book and its implications for macroeconomic policy, the difference between helicopter drops and QE, negative interest rates, the safe asset shortage problem, and current Fed policy. I really enjoyed my conversation with Greg. He is a great conversationalist with a wide range of knowledge on macroeconomic issues. You will enjoy his insights. You can listen to the podcast via iTunes or Sound Cloud , or through the embedded player. And remember to subscribe since more guest are coming!  Related Links Foolproof: Why Safety Can Dangerous and How Danger Makes US Safe --Greg Ip The Time and Place for Helicopter Drops --Greg Ip As the Dollar Falls, the World Perks Up --Greg Ip Bond Shelter  (Safe Assets ...

  My latest Macro Musings podcast is with George Selgin, director of the Cato Institute's Center for Monetary and Financial Alternatives. We discuss in depth Selgin's call for a a Productivity Norm, a nominal income target for central banks that would result in inflation moving inversely with expected productivity growth. That is, he would have central banks stabilize aggregate demand growth but allow more price level flexibility based on technological advances. Along the way we cover the difference between benign and malign deflation and look, examine some of the historical cases of deflation, and discuss the recent productivity surge of the late 1990s and early 2000s.  It was a great conversation with George. Those listeners wanting more information on his Productivity Norm target for central banks should check out the links below. You can listen to the podcast via iTunes or Sound Cloud , or through the embedded player. And remember to subscribe since more guest...

A few weeks ago I attended a  conference on international monetary stability  at Stanford's Hoover Institute. It was an interesting conference that John Taylor nicely summarizes  here . I was fortunate enough to present one of the papers at the conference and got great feedback on it. The paper, coauthored with Chris Crowe, looks at two roles played by the United States in the international monetary system. First, the U.S. financial system effectively acts as a banker to world and second, the Fed has inordinate influence on global monetary conditions. We document these two roles and consider how they interact.  In this post I want to discuss the first role since it relates to an important ongoing problem previously covered here, the safe asset shortage. In  my next post I will cover the second role and see how it interacts with the first role.  Safe Asset Shortage As I have noted before, there is an ongoing  safe asset shortage problem. ...

My latest Macro Musings podcast is with Ramesh Ponnuru. Ramesh is a National Review senior editor, Bloomberg view columnist, and a Visiting Fellow at the American Enterprise Institute. Ramesh has written widely on many topics from health care reform to tax policy to national security and is considered by many to be one of leading conservative intellectuals of our time. He has also written extensively on monetary policy.  Ramesh writes regularly on monetary issues for the National Review and Bloomberg View as well in other outlets like the New York Times, The Atlantic, and The New Republic. He has been a forceful advocate in the conservative movement for taking a more nuanced yet rules-based approach toward monetary policy. Among other things, he called for the Fed to adopt a Nominal GDP level target, has questioned those who claim the Fed has kept interest rates artificially low, and has pushed back against those wanting a return to the gold standard.  On a persona...

My latest Macro Musings podcast is with Miles Kimball , professor of economies at the University of Michigan and blogger at " Confessions of a Supply-Side Liberal ". Miles is a well-known advocate of breaching the zero lower bound via the adoption of negative interest rates. Moreover, he has shown how to do it without getting rid of physical cash. Miles sat down with me to discuss his ideas on this topic as well as how the macroeconomics profession has changed over the past few decades. I had a great time discussing these issues with Miles. You will enjoy the conversation too. I would like to make several points on this controversial topic. First, if you believe in allowing markets to clear via the adjustment of prices, then you should in principle be supportive of negative interest rates. For an interest rate is just an intertemporal price--a price that clears resources across time--and sometimes a severe enough demand shock may require nominal rates to go negat...

My latest Macro Musings Podcast is with Cardiff Garcia, U.S. senior editor of  FT Alphaville  and host of the podcast FT Alphachat . After spending many years engaging with Cardiff in the econ blogosphere, it was a lot of fun having him come into studio for the podcast. Thanks Cardiff for making it happen! In our wide-ranging conversation, we were able to talk about what it is like to be a journalist covering macroeconomics and the debates that have raged within the profession. We also got to discuss the safe asset shortage problem, QE, fiscal versus monetary policy, asymmetric inflation targets, the Eurozone crisis, secular stagnation, and more. We ended our conversation with his career advice for young budding journalists wishing to cover economic issues.  You can listen to the podcast via iTunes or Sound Cloud , or through the embedded player above. And remember to subscribe since more guest are coming!

The Eurozone experienced a second recession in 2011-2012, just a few years after the first one in 2008-2009. This second downturn was the fatal blow that turned Europe's Great Recession into an outright depression. The standard explanation for the emergence of this second recession is the sovereign debt crisis and the increased fiscal austerity in the Eurozone periphery that occurred during this time. Is this understanding correct? Paul Krugman says no in  a new post . He points, instead, to the ECB's raising of interest rates twice in 2011 as the cause of the second recession. I agree with Krugman. This explicit tightening of monetary policy in the Eurozone, when many of its countries had to yet to fully recover from the first recession, increased the debt burdens and gave austerity its teeth. These latter developments had an effect on the Eurozone economy, but that they were more a propagating mechanism than the initial shock. I have a new Mercatus paper coming out soo...