Northern Italy bleg

I’m planning a 12 day expedition to try to boost Italy’s NGDP, and hence cut their debt/GDP ratio. I’d appreciate any restaurant suggestions for Vicenza, Padua and Milan. 

Blogging will probably not be possible, as I won’t bring a computer.  Let’s hope the news isn’t as bad as during my trip to Wisconsin a couple weeks ago.  BTW, I forget to mention my Wisconsin top 10 list after my trip.

1.  House on the Rock  — Shag carpet on the ceiling!

2.  Taliesin – Sublime.

3.  Capital building — one of America’s finest.

4.  Wisconsin Dells — like Vegas/Orlando, but much more kitschy

5.  Johnson Wax///Wingspread  — Frank Lloyd Wright in Racine

6.  Devil’s Lake  — Wisconsin lacks great scenery, but the southwest is attractive in a low key way.

7.  Unitarian Church in Shorewood Hills  — called one of the 5 best churches in America.  Most people living a mile away have never heard of it.

8.   Farmers and Merchants Bank in Columbus – Louis Sullivan’s last “jewel box” bank.

9.   Union Terrace, UW student Union in Madison – Back when I was in school a 16 year old could buy a pitcher of beer and sit by the lake drinking all evening.

10.  Milwaukee Art Museum  – designed by Calatrava–I need something in Wisconsin’s only big city.

Most of these are close to Madison, which is the state’s best city.


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29 Responses to “Northern Italy bleg”

  1. Gravatar of John John
    21. August 2011 at 05:57

    Wisconsin lacks attractive scenery? You haven’t been to the right places. Try visiting up north near the upper peninsula. The woods and lakes have some of the prettiest scenery in the country. I was able to take some incredible photos when I was up there a few weeks ago.

  2. Gravatar of Rien Huizer Rien Huizer
    21. August 2011 at 06:19

    Scott,

    So many nice places: Packers Stadium, Door country, Figure of Eight, Oshkosh, Hayward. And, until recently, decent money for good public services. Why go to that cesspool of financial irresponsibility (since ancient times, Etruscans, Phoenicians, GREEKS, etc). Disappointing.

  3. Gravatar of malavel malavel
    21. August 2011 at 06:42

    Sumner goes on vacation, better sell all stocks. Is this the proof that EMH is wrong? Or is it the exception that proves the rule?

  4. Gravatar of W. Peden W. Peden
    21. August 2011 at 06:57

    Malavel,

    ALL exceptions to the EMH prove the rule…

  5. Gravatar of mbk mbk
    21. August 2011 at 08:29

    Scott,

    was just in Padua in June for a few days. No specific restaurants but, do try the Grappas of the region… After dark the area around the famous Prato park is a bit slow, better stay in the main shopping district around the University (where Galileo taught). Padua is one of the many little gems in the region, Vicenza too btw, all those “secondary” rank cities are underrated and great in Northern Italy. I loved just walking around Padua, every corner of the old center has something interesting, here a church, there a lush balcony.

    In general, and re: your previous post, I believe GDP understates true standard of living in Italy, Austria, France, Germany etc., and overstates it in, say, Singapore… or even the US. That from my personal, humble, and humbling, experience, moving directly from Southern France to LA. And from my surprise every time I vacation in Europe from SG, how much quality there is in Europe. Just my personal feelings, no statistics, no compulsion to believe me.

  6. Gravatar of 123 123
    21. August 2011 at 09:35

    Padua – Le Calandre (in the suburbs). Be careful – for three months after eating there, all the food back home tasted bad to me.

  7. Gravatar of Victor Victor
    21. August 2011 at 09:44

    In Milan try Paper Moon in Via Bagutta 1. Try the insalata di carciofi (artichokes) and the tagliata (great meat)

  8. Gravatar of W. Peden W. Peden
    21. August 2011 at 10:32

    mbk,

    The fact that a large amount of the southern European economy is off the books may have something to do with that. It’s a phenomenon I’ve noticed whenever I’ve visited the Third World.

  9. Gravatar of Scott Sumner Scott Sumner
    21. August 2011 at 12:23

    John, Heh, I said the southwest was attractive. Great scenery is like Mt. Rainier National Park. No, Wisconsin doesn’t have that.

    Rien, I’m from Wisconsin, and I never heard of figure of 8.

    Malavel and W. Peden. Yes, that pattern has me worried.

    mbk, Thanks for the tip.

    A lot could be said about living standard comparisons.

    1. Americans definitely have more stuff, Europeans more leisure. I tend to like leisure, so I lean toward Europe. But most Americans prefer more stuff.

    2. LA is not a good comparison. A house that costs a million in West LA is $200,000 in most of America.

    3. There is no question in my mind that living standards in places like Texas are higher than Europe, for middle class type jobs. Not so sure about low income jobs.

    4. Singapore’s GDP grossly overstates living standards. But . . . although Western Europe has higher living standards, I consider Singapore to be the much more successful economy. Their model is more sustainable, and they will be much richer in the future. Remember that they have been rapidly closing the gap on Europe.

    Bottom line is where do people want to move? People that live far away from both Europe and America (say India/China) tend to prefer America over Europe. America is seen by them as offering higher living standards. But that partly reflects value judgments. Many of those migrants put lots of weight on having a big house/SUV etc, not quaint villages where they can sip wine in sidewalk cafes. When I visited southern Italy every other person told me they had an uncle or brother who’d moved to Boston, or Rhode Island, or some other nearby place. I’ve never heard someone in Boston say “let’s move to Naples to get a better life.” Revealed preference.

    Bottom bottom line–who the hell knows who’s better off. But I sure do love visiting Europe.

    123, Good to have you back. Weren’t you the IOR specialist? Did you see the article claiming lower IOR is contractionary?

    Thanks for the restaurant tip.

    Victor, Thanks for the tip.

  10. Gravatar of Morgan Warstler Morgan Warstler
    21. August 2011 at 13:57

    I asked around, maybe someone will find you something good.

    This quote deserves to go viral:

    “There are perhaps some green jobs that would be exceptions; we could eliminate all forms of welfare and food stamps and offer the unemployed minimum wage jobs pedaling stationary bicycles hooked up to electric generators, solving our budget, poverty, obesity and energy independence problems all at once — but these are not the jobs either the President or his supporters have in mind.”

    http://blogs.the-american-interest.com/wrm/2011/08/19/feeding-the-masses-on-unicorn-ribs/

    God I love stuff like this… liberals are just such idiots. It is AMAZING we let them vote.

  11. Gravatar of JimP JimP
    21. August 2011 at 14:59

    Uber-Bear Evans-Pritchard calls for real monetary easing.

    http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8714421/Relax-central-banks-can-still-save-us.html

    From the article –

    So with fiscal policy exhausted, the burden must fall on monetary policy. Here we have barely begun to use our atomic arsenal even at zero rates. As Milton Friedman taught us – though nobody in Frankfurt — it is a fallacy to think that low rates are loose. Zero can be extremely tight.
    That may be the case now with US Treasury yields signalling deflation and M2 velocity collapsing as it did pre-Lehman.
    To those who argue that the Fed is pushing on the proverbial string, David Beckworth from the University of Texas replies that the Fed showed between 1933 and 1936 that it could deliver blistering growth of 8pc a year despite debt deleveraging in the rest of the economy.

    My own view is that Ben Bernanke has strayed from classic Friedman policy, blunting the effect of his two rounds of QE. Under his doctrine of “credit easing” he has steered bond purchases to banks. This has limited effect on the quantity of money.
    A Friedmanite would argue that Bernanke has barely tried monetary stimulus. Yet he has greatly eroded his political capital in the process, especially by arguing that the purpose of QE2 was to push up inflation and help Wall Street. These were tone deaf justifications. “Treasonous” is the verdict of Governor Rick Perry of Texas. That was to be expected, but it does complicate matters.

    The eurozone obviously needs looser money. M3 broad money is stagnant and real M1 deposits have turned negative, even in Germany and Holland. Real M1 is contracting at an alarming pace in Italy. EMU growth has wilted, five countries are spinning towards default, and the banking system is seizing up. This cries out for a change of course, yet the European Central Bank is still tightening.

    The ECB’s Jean-Claude Trichet said “we do not do QE”. Indeed, Germany forbids it. Not only has the Bundesbank forgotten that the Bruning deflation of 1931 destroyed Weimar – not the hyperinflation of 1923 – it is imposing its policy blunder on the whole currency bloc. The visible result of piling monetary contraction on top of fiscal contraction is to push the Club Med over the edge.

    The lesson of 2008-2010 is that further QE by the Fed alone risks a dollar slide and a further global crisis. A successful monetary blitz – if required – would need joint action by all major central banks in concert, including the ECB with no ‘ifs’, ‘buts’, and hostile body language. Some $6 trillion would suffice, or 10pc of global GDP.

  12. Gravatar of Rien Huizer Rien Huizer
    21. August 2011 at 20:44

    W. Peden

    “The fact that a large amount of the southern European economy is off the books may have something to do with that. It’s a phenomenon I’ve noticed whenever I’ve visited the Third World.”

    The third world. Isn’t that in Tottenham?

  13. Gravatar of Aaron W Aaron W
    21. August 2011 at 21:21

    I forgot you were from Wisconsin! I live in California now, but I always make sure to visit home often since most of my family is there. I’m weird and like visiting in the winter – we go snowmobiling, ice fishing, etc. My uncle has a great house along a reservoir in the Wisconsin river. We go snowmobiling across the ice over to the ice drag races, get some deep fried cheese curds (you can feel your arteries hardening as you eat them) and then cruise around in the woods. Later, we hit a random country bar (can always count on Wisconsin to have at least 6 or 7 awesome dive bars even in a town with 10000 people) and play pool and talk with the (always friendly) locals. Great times!

    I agree that Madison is the state’s best city. I did my undergrad there and it’s just an awesome, beautiful city, especially in the summer. I actually haven’t been most of the times I’ve been back, so I should definitely go next time.

    I agree about Europe leaning more towards leisure vs. stuff compared to the United States. I’m the same way, honestly. I did a fellowship in the Netherlands for 3 months last year that seriously made me consider moving to Europe. I decided against it since I have too many roots here, but I did make a lot of friends with my colleagues so I have places to stay when I visit.

  14. Gravatar of mbk mbk
    21. August 2011 at 22:17

    Scott,

    I should have added that my image of LA is from the mid 90′s. That being said I wasn’t impressed by the amount of “stuff” in the US. I expected bigger houses and lots than I actually found in LA, and the shoddy build quality of it etc… And I found it really hard to find solid “middle class” products, everything seemed on the Walmart end. Cheap, but mediocre. Anhyhow those were first impressions. Ater a while I found that LA of course does have some nice corners, and that if you drive far enough you can find nice stuff too, or at worst, you mail order.

    And yes I agree, in many states, in the mid size cities, you can have a very nice standard of living, probably higher than in the comparable socio economic class in Europe. But for me most of this difference is in the fact that space (and large houses) are cheaper in the US. Not so much in the “stuff” which makes up only a small part of expenses anyway. Even in SG my expenses on “stuff” are a footnote compared to housing and transportation. And both housing cost and car taxes here are direct consequences of lack of space.

    I disagree with you on the SG model, it has brought great GDP and great asset appreciation but the wages are low compared to GDP and housing (although recently government has promised it will bring wages up to Western standards within 10 years, if I remember the wording correctly).

    My feeling is that people admire SG’s economic policies eerilie the same way as people admired Japan and its MITI in the 1980s. Singapore depends heavily on those sectors that the government decides to develop. In the 70s it was manufacturing, that didn’t quite take off, then it was electronics, that worked for a while, and when that brutally faltered late 90′s early 2000′s due to China, SG attemped biotech and education. Biotech was slow in coming, and on education the judgment is still out too. Luckily, the next strategic push, into finance and the casinos, worked out really well in the last 5 years. Now it’s up to the observer to say, skill or luck… I fear SG is just not terribly diversified and always in danger of having one of its key sectors falter.

    On immigration to/fro the US I can just as well show you people who migrated back to Europe after spending much time and money to immigrate to the US in the first place. And here in SG you find enough Americans who intend to stay – although they won’t give up their passports.

  15. Gravatar of Scott Sumner Scott Sumner
    22. August 2011 at 06:07

    Morgan, Very clever.

    JimP, Often he is very good (as here) but occasionally he can be wacky. He flip-flopped over QE.

    Aaron, Thanks for those comments, I often miss Wisconsin.

    mbk, I agree about LA houses being crummy, but you should visit Newton. There is a reason why so many immigrants prefer the US to Europe.

    I also think Americans have lots more stuff, we have big garages to put all the stuff in.

    When I visit Canada, Australia and Europe I am struck by how people buy cheaper models of cars. I don’t know if it’s still true, but at one time the number one model in America was the Honda Accord, and the number one model in Canada was the (smaller) Honda Civic. Canada’s doing well now, so that may have changed.

    I think it’s a mistake to focus on current wages in Singapore. Until recently, Singapore was much poorer than Europe. But it grows faster. Right now 15% of Singaporeans are millionaires, far more than any other country in the world. The ratio is rising rapidly. They have no entitlement crisis on the horizon, as pensions are fully funded. I’d trade the European model for the Singaporean model in a heartbeat. We are now seeing the price Europeans will have to pay for excessive public debts. Having said that, I don’t agree with the Singaporean government trying to pick winners–in that area I prefer Hong Kong.

  16. Gravatar of mbk mbk
    22. August 2011 at 08:45

    Scott, SG grows so fast mostly because of population growth due to immigration. SG real wages have grown some 1-3% p.a. lately when real GDP grew close to 10% p.a. and real estate grew up to 30%.

    Europe grows slowly like Japan because working populations stagnate or shrink. It is for this reason that the pensions are badly funded in Europe: Not enough future generations exist in Europe to bail out the Ponzi scheme. Yes, SG has it best with individual savings accounts. But SG too frets over the risk of outliving one’s savings and thinks of supplementing the savings scheme with retirement insurance plans.

    15% millionaires in SG, I heard of that. Think real estate valuations now. A million in SG nowadays may be a large public housing flat on the resale market (99 year lease actually). Or 1/2 of a private 3 bedroom condo. Or 1/3 of a 3000 sqft lot with a 2 1/2 bedroom house on it. Come to think of it, I believe hardly any landed property can be had below a million these days. So if you own one of those you’re a millionaire, of course. Since I know a bunch of landed property owners I ipso facto know a number of millionaires. They’re the SG middle class.

    This millionaire thing, I say, Money Illusion.

  17. Gravatar of W. Peden W. Peden
    22. August 2011 at 08:52

    Rien Huizer,

    Of course not. In Tottenham, there was plenty of stuff to steal…

  18. Gravatar of mbk mbk
    22. August 2011 at 08:57

    W. Peden,

    off the books economy, yes, that too, not just in Southern Europe.

  19. Gravatar of 123 123
    22. August 2011 at 12:13

    Scott, you said:

    “123, Good to have you back. Weren’t you the IOR specialist? Did you see the article claiming lower IOR is contractionary?”
    No, I haven’t seen it. Who wrote it, and what was the argument?

    The benefits of lower IOR are reduced by the AS damage to the money market fund industry – that is why the Fed probably will not do this.

    Permanent abolition of IOR would reduce the flexibility of the exit strategy, and so it would make the Fed more cautious, but of course the discussion is about a temporary reduction of IOR.

    For all practical purposes IOR is already virtually equal to zero, as Feddie and Fannie get no IOR (effectively cutting IOR to 10 bps for other credit institutions), and from the April 2011 FDIC insurance fee reduces it further by approx. 10 bps – that’s why BNY Mellon charges for large deposits.

    You said:
    “Thanks for the restaurant tip.”
    Reservations are needed.

  20. Gravatar of Marcel Marcel
    22. August 2011 at 14:48

    This restaurant in Padova has great Venetian food:

    Osteria dal Capo
    Via obizzi, 2
    tel: 049.663105

    As far as I remember it’s quite central.

  21. Gravatar of will will
    22. August 2011 at 15:58

    Try Mom bar near porta romana station, in Milan.

  22. Gravatar of Scott Sumner Scott Sumner
    22. August 2011 at 17:24

    mbk, You need to handle data more carefully. The 10% RGDP growth rate you quote isn’t even in the ballpark to trend. Trend is about 5%. If you have 2% to 3% immigration, then per capita growth is 2% to 3%. Not great, but pretty good for a rich country.

    The millionaire data excludes property, so that explanation is wrong.

    BTW, Singapore could probably raise per capita GDP by kicking out all the maids, but real income would fall for the locals, and for the maids. Sometimes more inequality is more humane than less inequality. Especially if the less inequality is purchased by keeping your country racially pure. (Japan)

    123, I certainly agree that lower IOR isn’t the first best policy. I’d go with a higher nominal target.

    Unfortunately I forgot who had the odd article on IOR, it was about a week ago on some place like Bloomberg or Yahoo.

    Thanks Marcel and Will.

  23. Gravatar of mbk mbk
    23. August 2011 at 02:45

    Scott,

    I didn’t pull the data out of thin air – I was talking about the spectacular last couple of years (example, 2010, RGDP growth 14.5%) where total real GDP growth and even GDP/capita growth were substantial but wage growth was not. Long term trends are more normal as you point out, but precisely they are also less spectacular. Maids aren’t that numerically important in the overall picture, but foreign labour as a whole is, of course.

    From data, mostly Singstat: Pop growth (total) was 20% from 2005-2010, much more than your 2-3% p.a., while real GDP grew 36% in that time. Using these figures, real GDP/capita grew ca. 136/120=13% over 5 years, or 2.5% p.a. compounded, but still, that’s not wage growth yet. For wages I found a Ministry of Manpower study that puts real wage growth at an average of 1.6% p.a. between 2002 and 2010, with the 2007-2010 subset at -0.3% p.a.

    The # of millionaires, I’d be curious myself how this was calculated, and who was included, given the typical wages here. I could not find data on millionaires on Singstat. I remember a quip in the press 1 or 2 years back that 65% of Singaporeans supposedly don’t pay income tax, which would put them at below US$20k / yr income. That doesn’t sound like budding millionaires. So I speculated it was with housing.

    Anyhow, have a good trip to Italy. Maybe we should all let GDP be GDP for a while.

  24. Gravatar of ssumner ssumner
    23. August 2011 at 06:11

    mbk, You were quoting RGDP growth figures from a recovery. When you actually looked at trend you found 2.5% RGDP growth per capita, not far from my 2% to 3%, I’d say. And wage growth was 0.9% p.a. less over a short 5 year period–so what–that’s margin of error. Plus oil prices have risen sharply–and they import.

    I’d guess the numbers are even worse in the US and Europe.

    I believe population growth has recently slowed.

    I don’t know where the millionaire data comes from. Google my “a million millionaires” post and you’ll find the link.

  25. Gravatar of alex alex
    23. August 2011 at 07:52

    Hi,
    In Milan I suggest a really traditional restaurant close to Brera: Ristorante Al Matarel http://www.ristorantimilano.info/ristoranti/al-matarel_milano.php

    You need a reservation and they probably do not accept credit cards… (one reason why Italy is defaulting, lol)but you have to try “Ossobuco” with rice

    Have fun in Italy

  26. Gravatar of ssumner ssumner
    23. August 2011 at 10:20

    Thanks Alex.

  27. Gravatar of James in London James in London
    25. August 2011 at 01:14

    I think you are there now, so probably too late. But you should visit Peck, the most stylish and sophisticated grocery store in the world. They have a cafe attached. Via Spadari 9, just near the Duomo. Coolest little hotel just opposite too, Hotel Spadari al Duomo.

  28. Gravatar of 123 123
    6. September 2011 at 07:51

    Did you try Le Calandre?

  29. Gravatar of Scott Sumner Scott Sumner
    10. September 2011 at 07:32

    Thanks James.

    123, No, it was closed I think.

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