Friday , April 26 2019
Home / S. Sumner: Money Illusion / Central bankers and the Great White Whale

Central bankers and the Great White Whale

Summary:
Here’s the Financial Times: Global economy: Why central bankers blinked It’s been 18 years since I read Moby Dick, but I vaguely recall that Captain Ahab made the mistake of anthropomorphizing the white whale.  Ahab had a sort of steely-eyed gaze—and didn’t blink when seeking revenge. Central bankers need to work hard to avoid anthropomorphizing the market.  Better to view market forecasts as a sort of natural force, like wind and waves.  If market forecasts change (as they did late last year), then by all means “blink”.   It’s nothing personal. Tags:

Topics:
Scott Sumner considers the following as important:

This could be interesting, too:

Tyler Cowen writes Gender and the confidence gap

Tyler Cowen writes Thursday assorted links

Tyler Cowen writes Wednesday assorted links

Tyler Cowen writes My Conversation with Margaret Atwood

Here’s the Financial Times:

Global economy: Why central bankers blinked

It’s been 18 years since I read Moby Dick, but I vaguely recall that Captain Ahab made the mistake of anthropomorphizing the white whale.  Ahab had a sort of steely-eyed gaze—and didn’t blink when seeking revenge.

Central bankers need to work hard to avoid anthropomorphizing the market.  Better to view market forecasts as a sort of natural force, like wind and waves.  If market forecasts change (as they did late last year), then by all means “blink”.  

It’s nothing personal.

Central bankers and the Great White Whale

Tags:

 
 
 
Scott Sumner
Scott B. Sumner is Research Fellow at the Independent Institute, the Director of the Program on Monetary Policy at the Mercatus Center at George Mason University and an economist who teaches at Bentley University in Waltham, Massachusetts. His economics blog, The Money Illusion, popularized the idea of nominal GDP targeting, which says that the Fed should target nominal GDP—i.e., real GDP growth plus the rate of inflation—to better "induce the correct level of business investment".

Leave a Reply

Your email address will not be published. Required fields are marked *