Tuesday, March 3, 2009

Willem Buiter..

...on the state of macro. Some nuggets:
  • If any market takes a finite amount of resources (however small) to function, complete markets would exhaust the resources of the universe.
  • The manifest failure of the EMH in many key asset markets was obvious to virtually all those whose cognitive abilities had not been warped by a modern Anglo-American Ph.D. education
  • So, no Oikomenia, there is no pot of gold at the end of the rainbow, and no Auctioneer at the end of time.
  • Charles Goodhart, who was fortunate enough not to encounter complete markets macroeconomics and monetary economics during his impressionable, formative years, but only after he had acquired some intellectual immunity, once said of the Dynamic Stochastic General Equilibrium approach which for a while was the staple of central banks’ internal modelling: “It excludes everything I am interested in”.
Here is Krugman (a little but more optimistic)
Here is Blanchard  (much more optimistic)
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1 comment:

M.G. said...

Here is M.G. in Progress in The Unbearable Lightness of Being economist. A bit more pessimistic...