(08-27-2013, 03:24 AM)kandrathe Wrote: Now we've got the hangover, for four years... And counting.
Ah, the drinking metaphor.
If your story was true, then we would not be at the ZLB. Full stop. It's impossible that you hit the ZLB because monetary policy was too loose, or because taxes were too low, or government spent too much. You can say we hit the ZLB because there was a financial crisis, and a flight to safety, but loose monetary policy *in the past* cannot do it. It moves in the opposite direction. It just doesn't make any sense.
I think Alan Greenspan has a lot to answer for. But the ZLB is not one of those things.
Quote:We need better stimulative fiscal policy. What we see happening in US fiscal policy is what failure looks like for both major parties. Since 2008, US domestic fiscal policy has caused more uncertainty, and has generally increased operating costs or the fear of them. Generally, I don't think QE has done more than stave off the inevitable. That's all I'm saying.
What's "the inevitable"? Inflation? Deflation?
Quote:I think that is +4% -- so I see that as 5-8% inflation rates across the CPI basket of goods.
You'll have to show me the paper. My prior is that anyone predicting 8% inflation is smoking whatever Peter Schiff sold them.
-Jester