Author Archives: John Taylor
More on “It’s Extreme Policies Not Extreme People”
I argue in the Wall Street Journal today that a huge shift to extremely interventionist economic policies in recent years rather than a shift to extremist positions is the source of the recent political clashes and governance crises in the … Continue reading
Posted in Financial Crisis
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What Line Will the House-Senate Budget Conference Draw?
The new House-Senate Budget Conference chaired by Paul Ryan and Patty Murray is supposed to reconcile the House and Senate budget resolutions passed earlier this year make a set of new recommendations. The House and Senate will then vote on … Continue reading
Posted in Budget & Debt
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Short Course on Policy Rules–Including Yellen’s Variant
In a recent interesting article, “The Yellen Fed? Precise and Predictable,” Catherine Rampell assesses Janet Yellen along the discretion/rules-based dimension rather than the hawk/dove dimension which so many others have focused on. Quoting several people, including me, the article suggests … Continue reading
Posted in Monetary Policy, Teaching Economics
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Reviewing the “Too Low For Too Long” Evidence
In her article “Alan Greenspan: What Went Wrong” in the Wall Street Journal Alexandra Wolfe considers whether monetary policy played a role in exacerbating the housing boom going into the financial crisis by holding interest rates “too low for too long.” I’ve … Continue reading
Posted in Monetary Policy
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Congratulations Banco de Mexico
Twenty years ago, a new legal requirement for central bank independence was introduced in Mexico. Here is the English translation: The State shall have a central bank, which shall be autonomous in exercising its function and management. Its main goal … Continue reading
Posted in Monetary Policy
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Congratulations Gene Fama, Lars Hansen and Bob Shiller
The Nobel Prize Committee chose very well in awarding the prize for the important individual contributions of each economist. And focusing on the group as a whole makes sense too. Fama put forth the efficient market idea that securities prices … Continue reading
Posted in Teaching Economics
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Big Question at Fund-Bank Meetings: What’s With QE3?
While the shutdown-debt limit talks continue in Washington, thousands of financial people from the private and the public sectors throughout the world (including me) crowded into town this weekend for the annual IMF-World Bank meetings. Aside from the shutdown, the … Continue reading
Where the New Chair Might Lead the Fed
Congratulations to Janet Yellen. The new chair’s most important challenge, in my view, is to lead the Fed toward a more predictable, less interventionist, more rules-based monetary policy of the kind that worked well when tried, as in the 1980s, 1990s … Continue reading
Posted in Monetary Policy
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The Uncertainty Debate: Now a Hot Research Topic
The impact of uncertainty—in particular policy uncertainty—is a hot topic of debate in the press and the blogosphere. So the Dallas Fed decided to hold a conference last week to explore the issue. Nick Bloom of Stanford, Tom Fomby of … Continue reading
Posted in Slow Recovery
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A Candid Exchange of Different Views of the Crisis
Yesterday the Hoover Institution and the Brookings Institution held an unusual joint conference on “The U.S. Financial System – Five Years after the Crisis.” Roughly half the participants were at the Hoover venue in Stanford, California and half were at … Continue reading
Posted in Financial Crisis
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Economics One 