Writing in today’s Financial Times, Glenn Hubbard argues–correctly–that the debate over the debt ceiling in Washington is misplaced. Rather than focus on the debt ceiling, he suggests that Congress and the Administration ought to consider the deficit. Or, as he puts it: “My wife and I don’t vote on whether we will pay our bills. … Read moreGlenn Hubbard is half right
I cannot let this day end without acknowledging the 145th anniversary of the failure of Overend, Gurney, and Company, which set off one of the 19th century’s more spectacular financial crises. Writing the day after the failure, the Times of London argued that the firm could,”…rightly claim to be the greatest instrument of credit in … Read moreHappy 145th Anniversary!
Speaking to the Economic Club of New York House Speaker John Boehner (R-OH) said: It’s true that allowing America to default would be irresponsible. But it would be more irresponsible to raise the debt limit without simultaneously taking dramatic steps to reduce spending and to reform the budget process. Wrong. Defaulting would be irresponsible. It … Read moreBoehner has it wrong
In a very entertaining piece in this weekend’s Wall Street Journal, Joe Queenen gripes about how economists measure inflation. He starts by lamenting the high cost of everything from gas, to bagels, to coffee. “You can imagine my surprise,” he continues, “when the latest economic data came out and we were told that inflation wasn’t … Read moreJoe Queenan on core inflation
Representative Barney Frank (D-MA) has introduced a measure that would change the membership of the Federal Open Market Committee (FOMC), the group within the Federal Reserve that sets short-term interest rates by intervening in the federal funds market. The FOMC currently consists of the seven members of the Board of Governors of the Federal Reserve … Read moreChanging the rules at the FOMC