Thursday , March 4 2021
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The author David Beckworth
David Beckworth
I am an associate professor of economics at Western Kentucky University, an adjunct scholar at the Cato Institute, and a former economist at the U.S. Department of Treasury.

Macro and Other Market Musings

This macroeconomics focused blog by David Beckworth, an associate Professor of Economics at Western Kentucky University, has recently launched an awesome podcast that features well-known economists, many of whom are featured on this list. David’s blog highlights is a great place to start to learn about specific economic events.

Storytelling: Friday Chart Edition

I have not posted here in awhile, so I thought it would be good to share a few recent charts that tell interesting stories.Central Bank Balance SheetsFirst up, are two charts that show the relationship between the size of the central bank balance sheets and inflation rates. The first one shows for the 2010-2019 period the average size of central bank balance sheets as a percent of NGDP plotted against the average core inflation rate. Since larger balance sheets are typically seen as adding...

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The Fed’s New Framework

I have a new article presenting my take on the Fed's new average inflation target (AIT). It includes an explanation of how it works compared to the Fed's previous inflation target and what it could mean for the recovery. I note that although AIT it is not quite a NGDP level target, it is a step in that direction. Moreover, it could lead other central banks to follow suit. Check it out.Also, here is an earlier piece I wrote on make-up policy and how it could be best implemented via a NGDP...

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Make-Up Policy: Where Art Thou?

As we head into the second half of the year, the swift recovery many were hoping for is facing an uncertain future. The resurgence of the COVID-19 virus and concerns about dwindling fiscal support have many worried. I submit that even in the absence of these worries, the recovery would still be on shaky grounds without the Fed explicitly committing to 'make-up' policy. Make-up policy is an explicit framework that allows the Fed to correct for past misses in its target. In the case of a...

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NGDP Targeting in the United Kingdom

Something interesting is happening in the United Kingdom. Some government officials there are pushing for the Bank of England to adopt a NGDP target. From the Independent: Officials in the UK Treasury are “probably” considering whether to change the Bank of England’s inflation-targeting mandate due to the massive economic shock imparted by the coronavirus crisis, according to a former minister.  Lord Jim O’Neill, who was commercial secretary to the Treasury in 2015, wants the central bank...

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