Fedgames, or Speaking Craven Flattery to Power

[The Minsky Moment]

Yellen's term as Fed Chair ends Feb. 2018.  Although the general view is that she has performed well, her reappointment prospects are dim.

She recently expressed some (deserved) skepticism about the Trump admin's long run 3 percent growth projections, saying it would nice to achieve but "challenging"

In response - 3 of the leading candidates to replace her jointly released a letter stating "The policy changes of the kind proposed by the Congress and the Administration, if enacted, would significantly improve the economy's growth prospects . . . Could implementation of such a comprehensive economic plan raise the economic growth rate to 3 percent? We believe it can.  We judge that such a  policy package, in part by encouraging firms to expand by bringing new investment to production, can help raise trend labor productivity growth to around 2.3 percent per year in the nonfarm business economy and perhaps higher."  They go on to posit that the magic Trump fairies will also cause labor force participation to grow 4 percent over a 10 year period.  https://budget.house.gov/wp-content/uploads/2017/07/on_the_prospects_for_higher_economic_growth.pdf

Put aside the letter's invocation of empirically unsupported and debunked old chestnuts like the linkage of marginal tax rates or deficit spending to labor productivity rates.  We are now half a year into the Trump-GOP dominion and so far the administration has enacted exactly zero economic legislation.  Tax reform has been back burnered.  On spending the US is quietly drifting into another interest default crisis, which may be the most important under-reported story in the country right now.  "If enacted" looks a lot like a flying pig assumption.

As a logical economic argument this is a sad piece of work.  As a pathetic pitch for a job, OTOH it looks like a promising opening to President Sunkist.

[Jacob]

If Trump appoints an incompetent crony to the post, how long is the US stuck with the new chair?

[Admiral Yi]

If Trump appoints an incompetent crony to the post, how long is the US stuck with the new chair?

Six year term I think, although I believe there is an impeachment mechanism.

[Jacob]

I see. Thanks.

[Valmy]

So...tell me about this interest default crisis. What does that mean?

[CountDeMoney]

So...tell me about this interest default crisis. What does that mean?

Remember in 2014 when Obama said if the US defaulted on its interest payments as a result of failing to raise the debt ceiling, it would affect not only the credit rating of the government but the national economy as a whole, and he was called a liar by a senator because "nobody knows what would happen"?

The guy that said that is now the director of the OMB.


What does it all mean?  It means hold on to your potatoes, doll.

[Monoriu]

I don't care about any of that.  The Federal Reserve needs to raise interest rates 

[CountDeMoney]

I don't care about any of that.  The Federal Reserve needs to raise interest rates 

Fuck you, you fucking PLA plant.  You're not fooling anyone, you know.  I'm on to you, Mao Say Tongue.

[Ed Anger]

Time to stockpile gold and ammo.

[Razgovory]

I thought it was 4% growth per year.

[jimmy olsen]

I don't care about any of that.  The Federal Reserve needs to raise interest rates 

The US defaulting would cause a new depression and tank China's economy as well.

[Monoriu]

I don't care about any of that.  The Federal Reserve needs to raise interest rates 

The US defaulting would cause a new depression and tank China's economy as well.

That's precisely the aim

[Oexmelin]

Mono has never have any qualms about wishing misery for millions, curtailing civil liberties, mooching off of whatever and whomever, as long as it can benefit his fucking retirement fund so that he can watch anime he stole.     

[jimmy olsen]

Mono has never have any qualms about wishing misery for millions, curtailing civil liberties, mooching off of whatever and whomever, as long as it can benefit his fucking retirement fund so that he can watch anime he stole.   

But it would wreck his retirement fund.

[The Minsky Moment]

If Trump appoints an incompetent crony to the post, how long is the US stuck with the new chair?

To be clear none of the three candidates at issue is incompetent or a crony, although in my personal opinion all are less than ideal.  But this letter is a pretty transparent effort to push for Yellen's job and IMO beneath people of their reputation.