Good Sentences: Karl Smith on Tyler Cowen

Karl Smith:

“Tyler Cowen looks at the massive scale of ECB bond buying and asks

There is a longer discussion here.  One way to read this is: “That’s not yet a lot.”  Another is: “Oh my goodness, they’ve already been doing quite a bit.”  Another is: “Lots of buying without a credible signal of future intent isn’t worth a whole lot.” I would stress the point that credible long-run signals don’t exist for Europe right now.  No one knows what “the game” will be like a year now, or less.  That makes all possible solutions harder to pull off, since announcements can be shrugged off as idle chatter.

My obvious position is that you can buy all the bonds you want and it means less than a promise to buy bonds.”

Also: ” …while I definitely see the ECB as the type of institution that would dither while Europe burned and don’t at all see them as the type of institution that would give in to a speculative attack. I feel pretty confident that they would double down against the speculator and ruin him or her as a matter of principle.”

Advertisements

About Joe Colucci

From Michigan, now in Boston via DC and NYC. BA in Economics from NYU. A geek and a nerd, of the type that thinks there's a meaningful difference between the two. Avid fan of good TV, good argument, good beer, good food. I work at the Lown Institute on reforming the health care delivery system, and I blog on anything else that strikes my fancy at wonkinakilt.wordpress.com. Obviously, anything that I post on Twitter or Wordpress is my own rambling, and is not endorsed by any employee, colleague, or acquaintance, past, present, or future. View all posts by Joe Colucci

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: