BRIEFLY NOTED: For 2022-01-14 Fr
Good Federal Reserve Nominees, Hexapodia Podcast on Inflation, & Other Topics...
CONDITION: Federal Reserve Nominees:
I have only one complaint: these fill-up-the-FRB nominations are a year late:
Joe Biden: Federal Reserve Nominations: ’Sarah Bloom Raskin to Serve as Vice Chair for Supervision of the Federal Reserve, and Lisa Cook and Philip Jefferson to Serve as Governors…. Together with Chair Powell and Dr. Brainard, who I renominated last month, this group will bring much needed expertise, judgement and leadership… continue the important work of steering us on a path to a strong, sustainable recovery, while making sure that price increases do not become entrenched over the long term…
They do face a difficult task right now. As John Maynard Keynes wrote back in 1924: “the Governors and Court of the Bank of England… now and for the future have a much more difficult and anxious task entrusted to them than in former days” <https://archive.org/details/dli.ernet.16773/mode/1up>.
First: Hexapodia XXXIII: Inflation!
Noah Smith put it this way: "Team Transitory has lost, and the Team Transitory members have all shifted over to Team The-Fed-Has-Got-This—which is probably the right view to have of the situation.”
I would prefer to say: “We need inflation right now—because our inflation target was too low and was undershot, inflation is what we must have to make Say’s Law true in practice and get us to full employment, and necessary also to grease the great sectoral rebalancing towards goods-produciton now underway. Keeping that inflation transitory is the job of the Federal Reserve—and right now there is every reason to be confident that the Fed has got this.”
We probably should have gotten a third who disagrees more with us on for this topic to make it more interesting. But that would probably have made it less informative:
One Video:
Liu Thai Ker: The Architectural Mastermind Behind Modern Singapore: <https://www.ted.com/talks/liu_thai_ker_the_architectural_mastermind_behind_modern_singapore>
One Picture:
Very Briefly Noted:
William L. Shirer: The Collapse of the Third Republic: An Inquiry into the Fall of France in 1940<https://archive.org/details/collapseofthird00will/mode/1up?view=theater>
VoxChina: ‘A Bridge on Economic Issues between China and the World… <http://voxchina.org/>
John Cassidy: Joe Biden Starts to Make His Economic Case <https://www.newyorker.com/news/our-columnists/joe-biden-starts-to-make-his-economic-case>
Wikipedia: The City of the Sun: ‘Tommaso Campanella… 1602… <https://en.wikipedia.org/wiki/The_City_of_the_Sun>
Wikipedia: New Atlantis: ‘Published posthumously in 1626… tucked into the back of a longer work of natural history, Sylva sylvarum… <https://en.wikipedia.org/wiki/New_Atlantis>
Noah Smith: Yes, Worker Skills Matter
Aaron Rupar: Trump’s Attack on “Gutless” DeSantis is the Opening Salvo of the 2024 GOP Primary: ’By trying to portray his competition as weak, Trump’s talking a page out of his 2016 playbook…
John Holbo (2010): Libertarianism, Property Rights, & Self-Ownership
Tom Nichols: ’In the 92 election I was living in New Hampshire, and that’s when it really became clear to me that people think the job of the President of the United States is to find a job for a pipefitter in Nashua…
Paragraphs:
William H. Janeway: Capital Is Not a Strategy: ‘While entrepreneurs and venture-capital founders tell themselves that “capital is a strategy,” bubble finance is no substitute for a business plan that can achieve positive cash flow…. In the low-friction world of internet-delivered or mediated services, start-ups are eager to spend ever-greater amounts of other people’s money to acquire customers, the goal being to emerge victorious in a winner-takes-all race…. Occasionally, these explosions of investor exuberance have funded the deployment of innovative technologies at sufficient scale to transform the market economy, as was the case with railroads, electrification, and the internet. Whether a bubble is productive depends on what it leaves behind. But all bubbles burst, so even investors in the vehicles of a productive episode inevitably will fall into one of two categories: the quick or the dead…. The managerial sagas of Uber, WeWork, and Theranos represent the downstream consequences of the flood unleashed by central banks. Theranos founder Elizabeth Holmes may be the only one so far to have been caught crossing the line into criminal liability as she pumped and puffed up her company. But the absence of other prosecutions is no excuse for investors and board members to abandon their fiduciary responsibilities…
Mohamed El-Erian: The Key to 2022 Will Be How Inflation Is Brought Down: ‘For more than a decade, large-scale central bank purchases of assets boosted not just those being bought in markets but also virtually all other assets, be they financial or physical (such as housing, art and other collectibles). This was particularly the case in 2021…. As the new year unfolds, both the Fed and markets have a huge stake in inflation coming down in an orderly way. But the window of opportunity for policy to achieve this is rapidly closing. The alternative is a disorderly drop, which would involve the even bigger Fed policy error of having to be too abrupt in tightening monetary policy after being way too slow previously…
LINK: <https://www.ft.com/content/20e0857b-99cb-4495-8677-8746d97db836#myft:my-news:page>
Robert Armstrong: How to Panic About Inflation: ‘High levels of panic will be appropriate if we see sharp acceleration in services prices, especially outside healthcare and transport…. This would indicate that the strong wage gains we have seen recently are spreading pervasively though the economy, in ways that could (in theory) scare everyone into thinking inflation is here to say, and trigger the dreaded wage-price spiral…. If the Fed gets to its target two per cent rate in 2023—that still means negative short-term rates…. “That is not going to constrain the cost of financing anything”…. The Fed might have to get much more hawkish than it is now, with heavy consequences for markets. Unhedged is not there yet, because we’re just not convinced demand will be strong for long, and the bond market supports our doubts. But Michele’s argument frightens us all the same…
LINK: <https://www.ft.com/content/04892b1b-d977-473d-8b54-d34e33a29703>
Ian King: Intel (INTC) Is Having a Happy New Year So Far, Enjoying 8% Rally: ‘At last week’s CES in Las Vegas, Intel executives said that a new raft of products will put it back on top in the computer processor arena. They made the same argument at JPMorgan Chase & Co.’s technology confab. And earlier this week, Intel added a new chief financial officer, demonstrating that its current CEO is now firmly in command of the company’s trajectory…. At least some investors are willing to listen to Intel Chief Executive Officer Pat Gelsinger’s message of renewal after nearly a year on the job…. Up until this point, Gelsinger has been playing a hand that was dealt by earlier executives (whom Intel fired)…. Intel… announced it’s shipping graphics processors, an attempt to take on Nvidia on its home turf. Intel currently has zero share in the lucrative market for the add-in cards loved by gamers…
Scott Lemieux: When He’s Right, He’s Right: ‘As I’ve said before, the closest thing Trump has to a redeeming quality is his relentless humiliation of his most obsequious lickspittles, and turning on America’s Beloved COVID Governor he even stumbles into an insult that’s right on the merits: “Former president Donald Trump on Tuesday ripped into politicians who refuse to say if they’ve received a COVID–19 booster shot—a group that notably includes Florida GOP Gov. Ron DeSantis. ‘I’ve had the booster’, Trump told One America News Network in an interview. ‘Many politicians, I watched a couple of politicians be interviewed and one of the questions was, “Did you get the booster?” Because they had the vaccine, and they’re answering like—in other words, the answer is “yes”, but they don’t want to say it, because they’re gutless. You gotta say it, whether you had it or not, say it.’” One advantage of being a cult leader is that it makes you the one Republican who can accidentally tell the truth and not see your political career ruined over it.
LINK: <https://www.lawyersgunsmoneyblog.com/2022/01/when-hes-right-hes-right-6>