Good news! The Fed’s moving toward “whatever it takes”
I have recently been emphasizing two policy recommendations:
1. Level targeting
2. A “whatever it takes” approach to asset purchases.
The second recommendation is that the Fed stand willing to go beyond purchasing just Treasuries and MBSs, although I’m not sure that additional purchases would actually be necessary.
Today, the Fed announced some new policies that edge us closer to “whatever it takes”:
The Fed announced that it was suspending its previous guidance on quantitative easing, which sought to buy “at least” $500 billion in U.S. Treasuries and $200 billion in agency-backed mortgage-backed securities “over coming months.” The Fed now says it will purchase securities “in the amounts needed,” and will also expand the scope of those purchases to include agency commercial mortgage-backed securities.
The central bank also unveiled a Primary Market Corporate Credit Facility (PMCCF) that would directly purchase eligible corporate bonds from investment grade issuers in addition to a Secondary Market Corporate Credit Facility (SMCCF) that would buy corporate bonds in the secondary market, which could include some eligible investment grade corporate bond exchange-traded funds.
Both programs will last until September 30, 2020.
Excellent work Mr. Powell!
The next step should be for the Fed to make clear that its “in the amounts needed” phrasing refers to bringing the PCE price level back up to a 2% trend line from December 2019, not just stabilizing financial markets. And add stocks as well.
And the next step (no hurry) should be to switch from price level targeting to NGDP level targeting.
And the final step should be to use market “guardrails” to guide policy.
And then we’re done, and macroeconomics can close up shop.
PS. I’ll take this as an admission from the Fed that MMs were right and the Fed was wrong during 2009-13 when it failed to so “whatever it takes” QE.
Update: This headline caught my eye:
Fed’s Bullard: Coronavirus shutdown not a recession but an investment in survival
I’d rather call it a recession. I’d rather claim that the vast majority of recessions are monetary and a few are caused by real shocks, then to be forced into an argument with RBC-types who say “well of course you don’t believe real shocks can cause recessions, you’ve defined ‘recession’ to exclude real shocks.”
Having said that, I don’t really care what people call it. It will be obvious to all that it’s an unusual case.
Update #2: Monday morning Beijing traffic was finally back to normal!. PM traffic still down a bit.
Tags:
23. March 2020 at 07:18
“And then we’re done, and macroeconomics can close up shop.”
Really? Won’t there always be another mole to whack? As much as I have always thought the general drift of this blog is essentially inarguable, this point almost seems like tampering with the nature of reality itself.
23. March 2020 at 07:37
I’m not sure I understand why you see the expanded asset types as important? Why can’t the fed meet its monetary policy goals through level targeting/purchasing of treasury notes?
23. March 2020 at 07:44
anon, Yes, I suppose something will eventually pop up.
B King, You are right that treasuries are probably enough, if combined with level targeting. But having the ability to buy a wider range of assets in an emergency is useful for credibility purposes—to convince markets to expect higher inflation.
23. March 2020 at 07:53
Excellent comment as always. However, the open ended part of QE tied to an economic outcome is the most important. Now they just need to say explicitly that the economic outcome is TIPS spreads or better NGDP level target.
One quibble. I wish they were allowed to buy equities too instead of focusing just on debt securities.
I think that a more “neutral” monetary policy would be to buy the entire market portfolio of assets in the economy corresponding to their share. So by that reasoning, they maybe 30% or probably more of their purchases should be ETFs on broad stock indices.
23. March 2020 at 08:15
The Fed finally takes the leap——that is good.
We still need to make a decision to let people out of their bunkers—–supposedly 75k tests a day are coming our way—We assume the curve needs to bend, but the death curve is bending up for last 10-12 days—although at a lower absolute growth level, oddly, then when China’s curve was bending down from late Jan to early Feb.
It almost has to start bending the other way soon—is that a week–a month? not a big believer in antimalarials and vaccines won’t be here for what feels like infinity.
So, when we finally believe hospitals will not get or stop getting overrun—and the virus is still increasing—what will we do? If we do what we are currently doing—maybe some “creative destruction” will help a bit—-how is that not still a disaster—regardless if Fed is helping ?
In other words, is such a worse case world–which may be not the worse case at all—how much in absolute terms can the Fed’s actions help? Is it possible they do everything right and we still have a depression—just less worse than it would have been?
I assume the answer is yes—and I assume we need to end these “lockdowns” within 1-2 months. Fauci is tossing out “maybe several weeks” –key words—“maybe” and “several”
23. March 2020 at 08:15
Julius, I agree about stocks. (That’s what I meant by “add stocks as well”)
But overall I’d stick to Treasuries until there was some emergency that required corporate stock/bond purchases.
23. March 2020 at 08:30
“I suppose something will eventually pop up.”
If we ever really initiated NGDPLT, has there been on thought on designing futures markets that would attempt to anticipate where the next mole might pop up (or the location of potential icebergs, or whatever)? This is kind of a vague question, probably because it’s a vague thought.
23. March 2020 at 08:32
just saw Bullard’s reframing of the issue—even 30% unemployment is acceptable–interesting–very.
he assumes we can fill in the missing GDP gap by various Govt schemes and w can do this for 3-6 months—necessary–like war spending. It is still “broken window” economics–as is war–but still necessary—it is still permanent loss–like broken window—but his key point is –“we come out the other side where we left off”—minus the loss
I find that hopeful—the coming out the other side part—that sounds insane—but it may be genius—-we won’t know till we know
23. March 2020 at 08:49
PSS—plus the gain of learning how to fight viruses—and maybe even some incidental new inventions
23. March 2020 at 08:51
PPSS—plus live saved—I speak in shorthand—that is the reason for the war
23. March 2020 at 10:31
Can the Fed really do a “whatever it takes” approach without exceeding 2% inflation for a number of years? The reason I think that we will see increased inflation if the Fed really does go with a “whatever it takes” approach is that the quarantines will destroy a lot of business, and the knowledge and relationships necessary to run those businesses. That is, it will be like bombs were dropped and destroyed a fair amount of our capacity to produce goods and services, though the cause of that will be a loss of organizational capital. So if the Fed is going to keep the economy from going into a debt crisis, we are going to need to inflate our way out of the problem.
I suspect that this will look a lot like stagflation, and I am not sure that the Fed has the intestinal fortitude to see this through.
23. March 2020 at 10:33
Just curious, why do you favor the Fed purchase treasuries first? Are there any technical implications for what type of debt/assets are purchased?
23. March 2020 at 10:38
The announcement boosted S&P500 futures by ~6%: https://twitter.com/papuschell/status/1242094250067517440?s=19
Largest and least ambiguous reaction to a Fed move I’ve ever seen in real time.
23. March 2020 at 10:40
Scott – I would be a bit concerned that purchasing other asset types would open the Fed to criticism that it was picking favorites or influencing business etc if its buying stocks or corporate bonds etc. I guess it is already doing a lot of that with the facilities it announced. It seems that public perception of Fed activity is already so confused that these kind of purchases would just harm its reputation if they aren’t needed on a technical basis.
23. March 2020 at 10:44
P Burgos – isn’t “inflating your way out of a recession” basically the point? If a recession is really about sticky wages causing high unemployment when the real price level drops, what you need is inflation to smooth out the damage, lower *everyone’s* wages, and prevent mass unemployment creating a lower aggregate demand/vicious cycle? So what if inflation is about 2%? even under the current regime (much less a level targeting regime) the Fed is supposed to have asymmetrical inflation so it SHOULD be higher than 2% if it is offsetting unemployment. The point of level targeting, if I understand correctly, is that keeping NGDP on path is how you avoid inflation getting out of control – but if RGDP is -2% or something, then you need 6% inflation to keep NGDP at 4% trend.
23. March 2020 at 10:54
I’m a bit embarrassed to be asking this after reading your blog so long, but what does focusing on 2% PCE trend line right now mean for NGDP? What NGDP target is needed right now to be on course to achieve a 2% PCE trend line? I’m assuming that keeping NGDP on course in the near future will require a spike in the inflation component of the NGDP number.
23. March 2020 at 11:09
Burgos, If they target inflation, there’s no reason for it to exceed 2%. I don’t believe this crisis will prevent output from bouncing back quickly after it is over.
MJ, I prefer Treasuries as it’s less distortionary.
Alex, Interesting. Stocks jumped 5% on a rate cut in January 2001. The biggest reaction I saw to monetary policy was a jump of over 15% over two days after Hoover began pushing a reduction in required gold reserve ratios for the dollar.
King, I agree with your concern, which is why I prefer Treasuries. If they buy corporate stocks and bonds it should be strictly limited to index funds.
Carl, Yes, NGDP targeting would mean higher than 2% inflation in the short run, but probably not in the long run.
23. March 2020 at 11:18
@ssumner and Alex:
That jump in S&P futures didn’t last very long…
23. March 2020 at 11:20
@B King – you drank the Kool Aid, but, even so, you should realize that a supply shock is usually not cured by either Keynesianism (fiscal policy) or the IS-LM / quantity theory of money (monetary policy); both of those tools are classically used for manipulating AD. Not to mention there’s a demand shock now due to quarantine; easier money won’t help lower unemployment when there’s a shelter-in-place order.
@Carl – you ask a very specific question that’s almost a troll question since it’s so specific. A better question to ask is a big picture one: after the Fed announcement, what are stocks doing in the USA? With 30 minutes of trading left, DJ-30 is down 800 points (-4%). Not an auspicious start. Confidence fairy damaged?
23. March 2020 at 11:37
I agree that an explicit level target is absolutely needed. But I’m still confused why none of the Fed statements during this past months have had any lasting effects on the stock market. They do have an immediate effect, but they sizzle out before the end of the day. Fed has issued statements in the past without explicit targets that worked regardless. Why aren’t the markets believing Powell this time?
23. March 2020 at 12:04
What do you guys expect? That the stock markets will jump back to their old levels as if nothing had happened? The US is still pretty far away from the peak of the crisis. There is no telling how bad it will get. It could get much worse. Why should this not be reflected in the stock market?
Should the Fed buy stocks now until all record levels are reached again tomorrow morning?
That could be a bit of a flaw in Scott’s theory. How far do we want the Fed to take this?
23. March 2020 at 13:04
>Should the Fed buy stocks now until all record levels are reached again tomorrow morning?
>That could be a bit of a flaw in Scott’s theory. How far do we want the Fed to take this?
Stock market would be exogenous and wouldn’t be an end goal in itself. Fed would take monetary policy as far as it’s needed to bring NGDP expectations to where they should be. I’m just using the stock market as an indicator that monetary policy had an effect.
23. March 2020 at 13:08
From the muted reactions from the stock market today, I am still convinced the Fed mostly just wants to stop banks from failing not hit their inflation target. If you read the statement, it sounds like they are willing to do “whatever it takes” to make sure the lending markets don’t collapse, not to make sure that NGDP/inflation doesn’t collapse. Case in point: they’ve had years to hit their inflation target prior to this forecasted recession, but they have continually fallen short, averaging 1.6% for the last decade.
The Fed is still focused on fighting the last war (financial crisis + banking collapse) and just doesn’t get NGDPLT yet. There is likely a floor to deflation if you commit to not letting the financial sector collapse, but that’s far from hitting the inflation target. What do you think it will take to convince them to hit the inflation target? It’s driving me nuts that no one will listen and I didn’t invent NGDPLT; I just read about it on the internet.
23. March 2020 at 13:17
@Edwin
There must be something better than stock markets. Maybe TIPS spreads are useful to some extent. Or something else where we can see inflation expectations in real time. Or some NGDP prediction market maybe. 😉
How does the Fed even know where it stands right now? The Fed seems to me like a driver trying to steer by looking in the rearview mirrors.
Or like a driver who drives with his ears instead of his eyes: If there’s a loud bang, then they finally know that something went terribly wrong. Nice!
23. March 2020 at 13:22
The markets aren’t extremely impressed with the Fed’s announcement. The Fed should start doing level targeting, and if that doesn’t increase their traction significantly, they should go all in on shock and awe. They should literally shock the world with the amount of assets they buy.
23. March 2020 at 13:29
@Christian List – “How does the Fed even know where it stands right now? The Fed seems to me like a driver trying to steer by looking in the rearview mirrors”. – Dumb analogy. Why is it that the US SEC requires that funds talk about past returns? Because the past is the only data we have to predict the future. Nobody can predict the future 100%, but using the past is helpful. Analogy: most of the time, if you had to steer blind, but could use the rear view mirrors, most people would use the rear-view mirrors, since most of the time the road continues as it has in the past. Kind of like Germany: they started WWI, and, in 1939, if you had to guess who might start WWII, it would be Germany. Germ-many. As in bacteria, virus, germ. Good one!
23. March 2020 at 13:45
If unemployment is 30%, why would an inflation target of only 2% be appropriate? That seems much too low to get everyone back to work in any kind of timeframe that doesn’t lead to hysteresis.
23. March 2020 at 14:52
Scott,
Why just treasuries? Isn’t one transmission mechanism the ability for people to take advantage of lower rates? Rates on mortgages have been stubbornly high despite rate cuts because of MBS liquidity, so buying instruments like the latter helps lower rates. The Fed has been aggressive on MBS purchases the past few days.
http://www.mortgagenewsdaily.com/mortgage_rates/blog/939595.aspx
23. March 2020 at 15:14
That’s actually an important point of my analogy: driving with the rear-view mirrors works as long as the road is nice and straight, but the first abrupt change of direction causes a huge crash every time.
Scott has the perfect solution: Just look out of the front window, you moron. It’s not that hard. But I’m not surprised you don’t understand that.
And why are you so obsessed with WW2. You really should see a psychiatrist about that.
23. March 2020 at 16:13
The S&P 500 dropped 3% in one day after Powell’s announcement of he would do whatever it takes.
What is the Scott Sumner explanation for this immediate decline?
We are down about 33% on the S&P 500 from recent peak, and I guess the first two legs of the bear market are in. I may be optimistic.
As Stanley Fischer advises, send in the helicopters. The Fed’s buying of Treasuries or even corporate equities on global capital markets will do little to stimulate aggregate demand within the United States.
23. March 2020 at 16:28
@ Burgos
“Can the Fed really do a “whatever it takes” approach without exceeding 2% inflation for a number of years?”
The more it exceeds 2% in the short run the shorter the period of >2% will have to be. The uncertainty is how much real output drops that needs to be made up with inflation to keep NGDP growing?
But If the Fed would just commit to even 2% pa increase in the PCE price level I’d be pretty happy.
But has anyone ever figured out why the Fed chose not to achieve this 2008-2020?
23. March 2020 at 16:33
Yields on 10-year and 30-year Treasuries fell by quite a bit yesterday after the Fed’s announcement.
Can that be construed as a positive sign?
Please explain.
23. March 2020 at 16:37
“What is the Scott Sumner explanation for this immediate decline?”
You should know the answer. Powell did not say “whatever it takes” to do what. Ditto “unlimited” purchases. He should have said unlimited except as necessary to prevent NGDP from accelerating much beyond the pre crisis growth rate.
It’s the same with helicopters. You have to commit to keeping aggregated demand growing.
23. March 2020 at 16:54
@ Thaomas
I am positing that the Fed is going to have a choice to make, one it might find painful. I realize that Prof. Sumner means NGDP level targeting by “whatever it takes”. What I am arguing is that NGDP level targeting that only aims at a 2% annualized NGDP growth rate will not yield full employment within the next five years. Without the threat of inflation eating away at real purchasing power, everyone with money will be content to just sit on their cash until an absolutely perfect opportunity shows up, which means that most businesses and organizations will be very happy to keep a low headcount and to take a very long time to fill any open positions, and a long time to approve requests to even begin the hiring process for new positions.
Remember that businesses already are accustomed to an environment with high unemployment, low growth and low inflation, in which taking a wait and see approach makes sense. They already have a decade’s worth of know how in keeping a businesses running and growing enough to please shareholders without hiring anyone. NGDP growth of 2% just gets us back to the equilibrium of low growth, low inflation, and low employment, perhaps after a short initial burst of somewhat higher inflation.
23. March 2020 at 18:02
https://medium.com/@tombarrackjr/preventing-covid-19-from-infecting-the-commercial-mortgage-market-e7444701745e
The above is a sobering view of commercial real estate markets, and really all property markets.
I would not advise anyone with a weak stomach reading the above.
Prediction: there will be a huge rise in the sale of adult diapers in the next two months. Buy now, before panic buying sets in.
23. March 2020 at 19:54
“Economists led by Northwestern University’s Martin Eichenbaum wrote that keeping social-distancing measures in place before the number of new virus cases declines — in other words, before a peak in the infection rate — could limit infections and prevent as many as 600,000 additional U.S. deaths.”
—30—
Okay, 600k deaths avoided, even if mostly elderly with co-morbidities. This sounds high, but let that go.
About $12 trillion shaved off US stock market capitalization so far.
About $20 million per life saved.
Yes, that sounds mercenary.
But if we are willing to spend so readily to save lives…why stop with COVID-19?
The libertarians of yesterday are wearing the jodhpurs of statist martinets and singing “Kumbaya.”
One prominent libertarian even wrote, “We are all in this together.”
Trump is not a symptom, he is a mirror. Pious perfidy=principles.
24. March 2020 at 06:28
The 10yr -> 30yr bond prices made big moves yesterday. Markets up today. This was the result of the Fed’s unlimited purchases announcement.
24. March 2020 at 07:13
@Spencer Hall: No, it’s the result of Congress finally passing a ‘stimulus’. And if it doesn’t like the terms, it will fall back again.
Everyone: read this –
https://www.ftportfolios.com/Blogs/EconBlog/2020/3/23/cut-the-politicians-pay
We need to get back to work in a virus-aware way ASAP.
24. March 2020 at 07:15
Here is the right way to think about it. The Federal Reserve yesterday before the market opened announced a huge quantitative-easing program, open-ended. The S&P 500 then declined 3%. The right way to think about that is that the S&P 500 would have declined 6% except for the positive news from the Federal Reserve.
And today, Tuesday the S&P 500 looks like it will go up by about 6 or 7% on news that Congress is getting ready to pass a stimulus bill. The right way to think about that is the market would have gone up 10% except for the negative news about more useless federal spending.
You just have to have the proper perspective, and remember, in macroeconomics no one is ever wrong.
24. March 2020 at 08:30
In 2008, the banking system proved startlingly fragile. Any thoughts on its current robustness, or lack thereof?
24. March 2020 at 08:32
msgkings, It’s back again today!! 🙂
Seriously, markets respond quickly, and then new information comes along.
Edwin, The Fed is reactive. They do something, but then the epidemic gets worse. They need to get ahead of the curve.
On your second post; no, the Fed should not be targeting stock prices.
Burgos, Yes, a higher inflation rate would be better. But even 2% is far better than what we’ll actually have. And I don’t think unemployment will be 30%, certainly not for more than a month.
Matthew, I meant 100% safe bonds, bonds backed by the Treasury. That includes MBSs.
Ben, I see you are peddling even more lies:
“What is the Scott Sumner explanation for this immediate decline?”
I don’t provide explanations for things that didn’t happen. The “immediate” impact was a 6% rise.
I also see you claim the stock market would rise $12 trillion if your plan were put in place. How did the UK stock market react to the “herd immunity” announcement? Just asking.
Your final comment is laugh out loud funny. An immediate stock market reaction has nothing to do with the Fed announcement. A move that occurred hours later reflects the new information, and a move that occurred a day later again has nothing to do with the Fed. OK, we’re clear now. When the Fed does something, ignore the immediate move, ignore the move a day later, and focus on how markets reacts 4 hours later. Got it.
24. March 2020 at 08:37
@Ewan:
The banks are FAR better capitalized now, so the risks are less. This is directly because of the experience of 2008.
24. March 2020 at 08:53
msgkings,
The idea of ending the lockdowns, before they even really begin, is absurd and unless and until we can properly test and track. Otherwise, we’ll just end up with the Italian nightmare or worse, in which case we’ll either lockdown even more or face the danger of panic and even more desperate behavior by individuals.
The right thing to do is shutdown the whole country now, ramp up the testing and tracking capacity, increase our hospital capacity, out fiscal support on blast, and then end the lockdown once the spread is under control.
24. March 2020 at 09:03
@M Sandifer:
Read the article, there are better ways to do a ‘shutdown’. More businesses should remain open, with smart anti-viral procedures.
A protracted recession is a case where the cure is literally worse than the disease.
24. March 2020 at 10:01
msgkings,
I did read the article. I find it absurd, as I mentioned. There’s actual evidence shutdowns work to slow the spread of the virus and to reverse fortunes. There’s no evidence, or even the mention of seeking evidence for the path that article vaguely discusses.
Politcians aren’t shutting things down, because there are perceived better ways to deal with the actual spread of the virus. They’re doing it, because the medical experts are telling them it’s their best hope unless and until they can test and track properly. And they’ve been much too slow to shutdown, at that.
Do you think any politician wants an unnecessary, historically large recession? We need to shutdown, get the spread of the virus under control, and then reopen. It’ll cause a lot of temporary pain, but it’s the only way to minimize that pain. It will also cause very long-lasting economic damange to the extent to which we do not offer proper fisical and monetary support.
The approach you advocate will kill many more people, after causing chaos and a further loss of trust in government after such stark changes in course. Then, we’ll be right back into a shutdown, after many deaths and our hospitals overwhelmed, with tremendous collateral damage.
Scott is largely correct that this shutdown is largely going to occur even without government and become more severe as the virus spreads. We do have a very risk-averse society and people arne’t prepared for the numbers of deaths, extreme suffering, and chaos the approach you advocate will cause.
I know plenty of people who were furloughed or laid off well before any states shutdown. Don’t you? All the major sports leagues had already cancelled or postponed seasons, schools closed, etc. No offense, but the end the shutdown early crowd lives in a fantasy world.
24. March 2020 at 10:08
@M Sandifer:
No offense taken, you are being a bit hysterical. I am not advocating opening the floodgates to doing things exactly as before. We still need to shut down air travel and large gatherings. But ‘nonessential’ businesses can re-open with anti-viral procedures (limiting number of people in the store, working from home, online schooling where possible (my kids are both doing so), tons of hand washing, etc). People still need to self-quarantine with any symptoms.
There’s some room between total shutdown and no change at all.
24. March 2020 at 10:15
msgkings,
Where’s the evidence the tweener approach you want to use will be sufficient?
24. March 2020 at 11:15
@M Sandifer:
Where is the evidence it won’t? No one really knows how to handle this.
Again, there are two extremes (total shutdown vs. no changes at all). I think we can make reasonable accommodations somewhere in between.
24. March 2020 at 11:50
Yeah, I’ll stick to supporting the strategy that’s actually seemed to work elsewhere. I’m not interested in soending lives on your proposed experiment. Thanks.
24. March 2020 at 11:50
Spending.
24. March 2020 at 11:56
@Michael Sandifer – don’t argue with msgkings. He’s a vicious troll who’s female companion runs a greasy spoon restaurant somewhere in NYC. That’s why he’s hellbent on reopening as quickly as possible so he can reinfect his customers with Covid-19 quicker than Typhoid Mary did. Truth is, India today instituted a three week lockdown, an Israeli virologist recommends a six week lockdown (and by lockdown he means the entire country, not just states like in the USA) and Greece and PH instituted 14 day lockdowns, the minimum necessary (and probably inadequate). Trump wants to end partial lockdowns after a week, since the GOP (and msgkings) favors a couple of weeks of GDP at the expense of hundreds of thousands of lives (the minimum number of dead will be 330k say the lower bound of estimates).
24. March 2020 at 14:53
Ray you are the best…that was a quick turnaround from telling us all we should be doing ‘herd immunity’. Now you’re Mr. Lockdown LOL. Stick to what you know, Ray. Hookers and chess.
Michael, you are hysterical. It’s not binary. And check Gov Cuomo’s comments today. He correctly pointed out that many of us already had the virus, showed no symptoms, and now have the antibodies. We should get tested and go back to work if so.
24. March 2020 at 16:04
msgkings,
Every expert in the area of infectious diseases I read wants tighter restrictions, while you want to loosen them with zero evidence for your perspective.
For example:
https://www.cnbc.com/2020/03/24/coronavirus-update-deaths-could-increase-if-trump-loosens-rules.html
Our healthcare system is already near capacity in some areas, and you want fewer restrictions. Will fewer restrictions save lives?
Sorry, but with respect, I don’t think you know what you’re talking about, and frankly, you come across as reckless and perhaps even desperate.
I’m certainly no expert here, but expert after expert says we’re not locking down enough, fast enough. Given the broad evidence, from my lay perspective, I agree with them.
The economy will recover, but not on the schedule people prefer. It’s easy to subject others, including our front line medical staffs, to greater risk of horrible death to avoid our own inconvenience, or even to save a year or two of the economy being in the toilet. Instead of arguing against the experts that we should take huge, unjustified risks with our most vulnerable people, you should be arguing for enough coordinated support to get us all through this crisis together.
Finally, if you’re going to make such reckless recommendations for our society, I challenge you to do it under your schedule actual name, and not hide behind a pseudonym.
24. March 2020 at 16:06
Again, Michael, hysteria. A sign of the times I guess.
24. March 2020 at 16:31
msgkings,
Literally, all you’ve offered is ad hominem. Zero evidence for your perspective, but almost certainly more suffering and death, and I argue, also a worse economic outcome. What you want would both be medical and economic malpractice.
Here’s James Pethokoukis making a similar point:
https://www.aei.org/economics/the-american-economy-cant-get-healthy-if-our-cities-are-getting-sicker/
Tyler Cowen has made similar points also. I guess we, along with the actual experts in the area, are all hysterical. We’re also all using our real names.
24. March 2020 at 21:14
@Michael S: I swear to god I’m not trying to rile you up.
I just don’t see why we can’t discuss a spectrum of virus-aware protocols that take into account the necessity of keeping some level of capitalism working.
“Save a year or two of the economy being in the toilet.” – I don’t think you realize the magnitude of this.
This whole situation is pretty sui generis. Has the entire world, or even just the US, ever DELIBERATELY shut down its economy? This is a real time massive global experiment, so forgive those who wish to have adult discussions about….tradeoffs.
As far as using a ‘nym here, and not my real name, I happen to work in a field where I would be reckless to post on blogs.
25. March 2020 at 02:45
msgkings,
I guess we define adult discussion differently. To me, an adult would not push for loosening restrictions that could cost lives on the basis of zero evidence, and hence, with no idea of how many lives would be lost versus rate of economic output saved.
Let’s get even more adult though, and tell me how many extra deaths-per-unit of economic output is acceptable to you. What’s your number?
I think you’d ultimately actually hurt the economy more in the process of more people dying horrible deaths.
25. March 2020 at 06:17
@Michael S: you don’t have the slightest idea how many lives are lost with different protocols, and neither do I. You also don’t have any idea how many lives are lost due to an economic depression. I’m just trying to discuss tradeoffs and you are hysterical. There are many ways to do a shut down, but you can’t even discuss them.
Grow up. And have the last word, since we already know it’s just more of the same.
25. March 2020 at 08:16
msgkings,
How many extra deaths-per-unit of economic output is acceptable to you. What’s your number? Stop bullshitting and answer the question.
25. March 2020 at 08:48
OK I’ll give you one more reply and then you are cut off, Mike.
Units of economic output might PREVENT more deaths than they would cause. Especially when I’m only suggesting some virus-aware measures to allow the economy to function better than a total protracted depression. Neither of us has any idea what those numbers are, but my ideas plausibly result in fewer deaths than yours. Recessions kill, depressions kill even more.
Just calm down already. Done with you, you add nothing to this discussion.
25. March 2020 at 09:40
msgkings,
More childishness, while appealing for adult discussion. You are the child here imploring father to let you outside, when he tells you it’s not a good day to go out. “Why should I let you outside, son?” “Because I wanna Daddy! It might not be dangerous.” That’s literally the perspective you’ve offered.
Here’s one of the papers upon which the more stringent lockdown recommendations is based:
https://www.imperial.ac.uk/media/imperial-college/medicine/sph/ide/gida-fellowships/Imperial-College-COVID19-NPI-modelling-16-03-2020.pdf
Fortunately, some of the readers of this blog value evidence-based perspectives. I’m confident you are convincing anyone that you’re correct.
25. March 2020 at 09:42
That is, I’m confident you aren’t convincing anyone with your perspective.