Re: [Pen-l] Yale’s Tobin Guides Obama From Grave as Friedman Is Eclipsed

[Jim Devine <jdevine03@xxxxxxxxx>]

Charles Brown wrote:
> Hmmmm optimal unemployment is zero.

I don't think that the mature Tobin would agree with this.  He
rejected Friedman's view that there's a "natural rate" of
unemployment, but getting to zero would be increasingly inflationary
(unless we switched to a non-capitalist system).

>John Cochrane, a finance professor at the Booth School of Business at the University of Chicago, said that while Tobin made contributions to investing theory, the idea that spending can spur the economy was discredited decades ago.

>“It’s not part of what anybody has taught graduate students since the 1960s,” Cochrane said. “They are fairy tales that have been proved false. It is very comforting in times of stress to go back to the fairy tales we heard as children but it doesn’t make them less false.”

> To borrow money to pay for the spending, the government will issue bonds, which means investors will be buying U.S. Treasuries instead of investing in equities or products, negating the stimulative effect, Cochrane said. It also will do nothing to unlock frozen credit, he said.<

who is this bozo?

(I apologize to the clowns of the world for insulting them by
associating their spiritual leader (Bozo) with Cochrane.)
-- 
Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own
way and let people talk.) -- Karl, paraphrasing Dante.
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