My new career

I have spent the past 6 years trying to do two jobs at once, my teaching job at Bentley and lots of blogging/writing/speaking on monetary reform.  I am pleased to announce that from now on I’ll be able to focus on monetary policy. Through a very generous donation of Kenneth Duda (a Silicon Valley entrepreneur who is supportive of market monetarism), the Mercatus Center has created a new program on monetary policy, and appointed me as director.  I’m sure people will have some questions about this, so let me provide a bit more detail.

A few months back I began raising money to set up a NGDP futures market.  At the time, Ken Duda offered to support the project with a large donation.  He also expressed an interest in supporting my NGDP targeting in any way he could. Initially he suggested setting up a foundation to promote monetary reform, and having me direct the foundation.  I thought it might make more sense to work within an institution such as a university or a think tank, where I could get managerial support.  We eventually decided to embed the project within the Mercatus Center.

The Mercatus Center is a bit different from Washington DC think tanks.  It is often regarded as the world’s premier university-based research center with a focus on free market ideas. I was reassured by the fact that Mercatus is attached to George Mason University (my favorite econ program), and that Tyler Cowen is the Chairman of the Board. One nice thing about Mercatus is that they are focused on funding serious academic research, and don’t insist that researchers follow any particular party line.  I’ve done three papers for Mercatus in recent years, but they’ve also funded other researchers with very different views of monetary policy.

Here I might add that at this stage of my life I’m not too worried about a lack of academic freedom. I’ve always been the type to say what I thought, even though my research topics were so unconventional that I often had a hard time getting published, and almost didn’t get tenure. Nonetheless, it’s nice to be in a situation where no one is likely to question my academic independence.  Not only does Mercatus allow me academic freedom, Ken Duda also wants me to follow the implications of my research where ever it leads, even if it leads me away from NGDP targeting.

As you might expect from someone who has donated money to both and Mercatus, Ken Duda is not a strongly partisan or ideological person.  He has told me that he’s basically a pragmatist, who became very frustrated by the condition of the US economy after 2008 and thought that my monetary policy ideas made sense.  He’s been a long time reader of my blog and has commented on numerous occasions.

I actually wouldn’t have had any problem taking a position funded by a much more partisan donor, and/or at a highly ideological think tank.  My policy is to always say what I think and let the chips fall where they may.  But I can’t deny it’s nice to be involved with a donor and research center that encourage academic freedom.

Although I am done teaching, I will actually be a Bentley employee for another 18 months, and after that I hope to maintain my Bentley affiliation through some sort “emeritus” relationship.  I will continue to live in the Boston area, although long term we plan to retire in Southern California. (In a sense I’ll never retire, as I’ll keep promoting NGDP.)  My contract with Mercatus runs through mid-2018.  I won’t discuss the monetary details, other than to say I’ll make roughly as much doing this project over the next 3 and 1/2 years as I would have made teaching at Bentley over the next 2 and 1/2 years.  More work for the money, but that’s fine as I won’t be so stressed trying to do 100 things at once.

I hope to achieve many goals, but the one that might be of greatest interest to MoneyIllusion readers is a book on NGDP targeting and market monetarism, based on this blog.  Mark Sadowski has agreed to work as a research assistant on the project.  I also hope to support academic research that provides more “rigorous” empirical and theoretical support for NGDPLT and related ideas. And I’ll continue to do shorter papers, op eds, speak to academics, business people and policymakers, work on the NGDP futures markets, etc.

And of course I’ll keep blogging here and at Econlog.

I’ve known this was likely to happen for several months, but kept it secret until the funding was in place.  Even my colleagues didn’t know (except my chair.)  It was a bittersweet feeling going down the final stretch last semester after 34 years of teaching.  I always envisioned telling my students it was my last class, but life never plays out as you envision it will.

I’ve started noticing restaurants that offer senior discounts to the over 60 group, a milestone I’ll reach later this year.  But you know what they say, 60 is the new 50.

PS.  I have a new post at Econlog on the zero bound problem.

Update:  Stocks open sharply higher on the news!  🙂



112 Responses to “My new career”

  1. Gravatar of Dave Dave
    13. January 2015 at 06:26


  2. Gravatar of Michael Michael
    13. January 2015 at 06:27


  3. Gravatar of foosion foosion
    13. January 2015 at 06:27


  4. Gravatar of Ray Lopez Ray Lopez
    13. January 2015 at 06:28

    Let me be the first to congratulate you! Does this mean you’ll be moving to Washington, DC? If so, we can be neighbors since I’m originally from there! This is great! We can exchange ideas over lunch, my treat!

  5. Gravatar of am am
    13. January 2015 at 06:34

    Glad you intend to continue blogging. I wish you well in the new post.

  6. Gravatar of Britonomist Britonomist
    13. January 2015 at 06:35


  7. Gravatar of Charlie Charlie
    13. January 2015 at 06:37

    Good luck, Scott!

  8. Gravatar of CMA CMA
    13. January 2015 at 06:40

    You know what they say, life begins at 80.

  9. Gravatar of Prakash Prakash
    13. January 2015 at 06:42

    Congratulations, Prof. Sumner ! With Mark Sadowski as research assistant, you guys will be unstoppable.

    Ken Duda, if you’re reading this, You’re THE dude! I believe this is high value philanthropy!

  10. Gravatar of John Hall John Hall
    13. January 2015 at 06:45

    Congrats Scott.

  11. Gravatar of Mario Mario
    13. January 2015 at 06:51

    This is terrific news. Monetary policy has been put so much more in focus and your voice is one of the best. Congratulations

  12. Gravatar of TallDave TallDave
    13. January 2015 at 06:51

    Good for market monetarism, and good for you.

  13. Gravatar of TallDave TallDave
    13. January 2015 at 06:52

    Mark Sadowski has agreed to work as a research assistant on the project.

    Almost missed that. Great to hear!

  14. Gravatar of Philo Philo
    13. January 2015 at 06:55

    About the time I turned 70 “Mr. Boffo” published a cartoon that captured my feelings perfectly: “Seventy is the new sixty-eight-and-a-half.”

  15. Gravatar of Kevin Erdmann Kevin Erdmann
    13. January 2015 at 07:00

    Good luck and thank you, Scott, Ken, and Mark.

  16. Gravatar of Todd Ramsey Todd Ramsey
    13. January 2015 at 07:00

    Your last classROOM, perhaps; but not your last class. You are teaching with every post. I suspect and hope your “class” will grow beyond what you ever thought possible circa 2007.

  17. Gravatar of Basil H Basil H
    13. January 2015 at 07:13

    Congratulations!! Extremely exciting news.

    I also agree very much with Todd Ramsey above: “Your last classROOM, perhaps; but not your last class”.

  18. Gravatar of Left Outside Left Outside
    13. January 2015 at 07:17


  19. Gravatar of Kenneth Duda Kenneth Duda
    13. January 2015 at 07:18

    Thank you Prakash. I am delighted to support Scott. Better monetary policy would meaningfully improve the lives of millions of people. How many chances do you get in life to support someone as awesome as Scott pursuing a goal with so much potential to make the world a better place?


    Kenneth Duda
    Menlo Park, CA

  20. Gravatar of Luis Pedro Coelho Luis Pedro Coelho
    13. January 2015 at 07:21


  21. Gravatar of Chuck E Chuck E
    13. January 2015 at 07:28

    Scott, congratulations to you and Mark!
    Thank you to Ken for making it happen.

  22. Gravatar of Nick Nick
    13. January 2015 at 07:34

    Thanks, Ken.
    And it’s always a treat to read Mark Sadowski. Moar comments plz!!

  23. Gravatar of Joe C Joe C
    13. January 2015 at 07:37

    Congrats – I look forward to reading the book!

  24. Gravatar of Vaidas Urba Vaidas Urba
    13. January 2015 at 07:38

    Congratulations Scott!
    Congratulations Mark Sadowski!

  25. Gravatar of David Andolfatto David Andolfatto
    13. January 2015 at 07:40

    Congratulations, Scott.
    All the best in your new career.

  26. Gravatar of Nick Rowe Nick Rowe
    13. January 2015 at 07:58

    Cooo! Well done Scott! And Ken! Yep, I think it’s the right move. And 60 is a good age to make a change.

  27. Gravatar of Randy B Randy B
    13. January 2015 at 08:10

    Congrats on your new adventure Scott.

    You have made great progress in advancing these ideas, this is just another step in bringing them to the forefront.

  28. Gravatar of Brian Donohue Brian Donohue
    13. January 2015 at 08:12

    Very good news for planet Earth!

    Ken, you are the man.

  29. Gravatar of Anthony McNease Anthony McNease
    13. January 2015 at 08:21

    Congratulations! This is fantastic news for you but also for everybody else. I’ve learned so much from this blog (I came here back in 09 on Ramesh Ponnuru’s recommendation). I stop by here every day. It will be exciting to see where your research leads you (and us).

  30. Gravatar of David R. Henderson David R. Henderson
    13. January 2015 at 08:22

    Congratulations, Scott, and thank you, Kenneth Duda.

  31. Gravatar of Patrick R. Sullivan Patrick R. Sullivan
    13. January 2015 at 08:22

    ‘ How many chances do you get in life to support someone as awesome as Scott pursuing a goal with so much potential to make the world a better place?’

    The magic of markets. Thanks, Ken.

  32. Gravatar of sabre51 sabre51
    13. January 2015 at 08:24

    Scott, very glad to hear this. It is easy to be cynical sometimes about renown going to academics who reinforce the status quo and take advantage of consumers’ ignorance, but your intellectual honesty comes through very clearly. It is heartening to see true curiosity and desire for truth be rewarded. Good luck, we’ll be cheering for you!

  33. Gravatar of Richard R. Taylor Richard R. Taylor
    13. January 2015 at 08:39

    Definitely great news for all us who regularly read this blog and push to educate others on the value of NGDPLT. Congrats Scott! And like everyone else, I want to thank Kenneth Duda for his generous support to make this possible.

  34. Gravatar of Britmouse Britmouse
    13. January 2015 at 08:46

    Congrats Scott, and bravo Ken.

    And a great title for the position! “Ralph G. Hawtrey Chair in Monetary Policy”

  35. Gravatar of Pietro Poggi-Corradini Pietro Poggi-Corradini
    13. January 2015 at 09:02

    Best wishes!

  36. Gravatar of ssumner ssumner
    13. January 2015 at 09:46

    Thanks everyone, and especially thanks to Ken.

    Ray, You said:

    “Let me be the first to congratulate you! Does this mean you’ll be moving to Washington, DC? If so, we can be neighbors since I’m originally from there! This is great! We can exchange ideas over lunch, my treat!”

    You are actually the 4th to congratulate me. Unfortunately I will be staying in Boston, and hence will miss out on those lunches.

    Britmouse, I’ll do a post explaining why Hawtrey was chosen.

  37. Gravatar of Martin Martin
    13. January 2015 at 10:03

    Congratulations Scott & Mark! And thank you Kenneth Duda for making this possible. I’ve followed this blog for a number of years now and it’s really cool to see this all happening.

  38. Gravatar of J Mann J Mann
    13. January 2015 at 10:11

    Wow! Congratulations and best wishes to all three of you!

  39. Gravatar of Henry Bee Henry Bee
    13. January 2015 at 10:18

    This is huge. Likely to add more economic and social value than anything else. We are all your backers but ken just added some real firepower.

  40. Gravatar of Randomize Randomize
    13. January 2015 at 10:21

    Congratulations. Well done to all involved.

  41. Gravatar of Student Student
    13. January 2015 at 10:23

    Congrats. If you do happen to venture into DC, I wouldn’t mine a lunch discussion as well. Perhaps we could meet up with Ray. I hear he lives under the 14th street bridge.

  42. Gravatar of Scott Sumner has a New Job Scott Sumner has a New Job
    13. January 2015 at 10:25

    […] Sumner has a new job where he will be free to focus on monetary policy and NGDP futures. Good for […]

  43. Gravatar of Scott Sumner’s new career Scott Sumner’s new career
    13. January 2015 at 10:29

    […] is more at the link.  Of course at George Mason and Mercatus we are all very excited about […]

  44. Gravatar of Morgan Warstler Morgan Warstler
    13. January 2015 at 10:30

    It couldn’t happen to a better guy! Congrats!

  45. Gravatar of Sina Motamedi Sina Motamedi
    13. January 2015 at 10:33

    About time.

  46. Gravatar of Daniel R. Grayson Daniel R. Grayson
    13. January 2015 at 10:56

    Great news, and thanks to Kenneth Duda!

  47. Gravatar of Rodrigo Rodrigo
    13. January 2015 at 11:21

    Congratulations! I am sad to hear you are leaving Bentley but feel very privileged and lucky to have had you as a professor.

    Best of luck in your future endeavors.

  48. Gravatar of Nicolas Cachanosky Nicolas Cachanosky
    13. January 2015 at 11:24

    Looking forward for your future work.

  49. Gravatar of Patrick R. Sullivan Patrick R. Sullivan
    13. January 2015 at 11:43

    ‘Update: Stocks open sharply higher on the news! :)’

    To paraphrase George C. Scott, imitating George Patton, A man that articulate has to be supported.

  50. Gravatar of Daws Daws
    13. January 2015 at 11:49

    glory! great move, fellas

  51. Gravatar of Great news! Scott Sumner Joins the Mercatus Center at George Mason University | The Market Monetarist Great news! Scott Sumner Joins the Mercatus Center at George Mason University | The Market Monetarist
    13. January 2015 at 11:51

    […] PS Scott also comments on his new career. […]

  52. Gravatar of JNCU JNCU
    13. January 2015 at 11:58

    Congratulations Doc

  53. Gravatar of Brent Brent
    13. January 2015 at 11:59

    Congratulations! Can’t wait for the book!

  54. Gravatar of Jack Jack
    13. January 2015 at 12:13

    Congratulations Scott! Please pass along any restaurant advice you get from Tyler.

  55. Gravatar of DanielJ DanielJ
    13. January 2015 at 12:20

    Congrats Scott! Now if only Gabe Newell could trick all of his steam users into participating in an NGDP futures market with chances to win game discounts. A guy can dream…

  56. Gravatar of Sean Sean
    13. January 2015 at 12:24

    Congratulations Scott. Perhaps you’ll come over here to the UK again and do some talks – LSE/Adam Smith/IEA, etc. Maybe a public debate with Simon Wren-Lewis and Chris Dillow. Now that I’d pay to see. I’m actually fairly new to the blog but it’s pretty much my favourite now (fractionally behind Arnold Kling). Not convinced yet about the “other” Scott. I would most like to see you develop your ideas on the tax code, healthcare, education, welfare, SS, etc. Remember the old saying: we all end up doing what we’re 2nd best at.
    PS – After waxing lyrical so much about Australia – you go for California – I’d have put money on Oz.
    PPS – Is that Morgan Warstler I see online. Morgan – you have to develop you’re Basic Income idea further.

  57. Gravatar of benjamin cole benjamin cole
    13. January 2015 at 12:26

    Excellent! Best wishes! I hope the George Mason-Mercatus imprimatur “allows” the right-wing to embrace Market Monetarism…though this will make MM more suspect to the left-wing…

  58. Gravatar of Philip Crawford Philip Crawford
    13. January 2015 at 12:27

    So much good news in this post. Congrats Scott and Mark.

  59. Gravatar of N P N P
    13. January 2015 at 12:49

    Fantastic news. A big thanks to all of those who were involved in making this a reality.

  60. Gravatar of Liberal Roman Liberal Roman
    13. January 2015 at 13:37

    I was kind of hoping that this post would announce that Obama has decided NOT to appoint the plumber…I mean community banker…to the Fed board and went with you. Nevertheless, this is good news. Congratulations!

  61. Gravatar of Ben J Ben J
    13. January 2015 at 14:11

    Congratulations Scott! There isn’t a better man for the job.

    Thanks very much to Kenneth Duda for making it happen, that’s incredibly generous of him.

  62. Gravatar of Pietro Poggi-Corradini Pietro Poggi-Corradini
    13. January 2015 at 14:21

    Off topic:

    Of late, I’ve seen a lot of predictions such as these:

    “90% of economists surveyed reckon the recent decline in oil prices will promote higher real US GDP growth”

    Reading this blog has conditioned me to immediately raise the NRFAPC (Never Reason From A Price Change) flag. But then I try to go one step further and ask myself why shouldn’t I reason in this way? Well because other things are changing as well, essentially.

    I know you’ve gone over this before, but I wouldn’t mind a refresher. It’s a standard idea in micro that prices are signals (the Use of Knowledge in Society etc…), so actors in the economy do respond to prices and change behavior all the time as a consequence. But what’s maybe not immediately clear from the word ‘signal’ is that changing behaviors also do move prices. So it’s a two-way street. Therefore the NRFAPC motto is more of a warning to those who are trying to explain macro events, not to confuse cause and effect.

    Anyways, are you part of the 90%?

  63. Gravatar of Bob Murphy Bob Murphy
    13. January 2015 at 14:42

    Congratulations Scott. I should just throw in the towel; I can’t possibly stop you now that your hands are untied…

  64. Gravatar of Matt Waters Matt Waters
    13. January 2015 at 15:14

    Congratulations. I don’t agree on all the technical details, but in broad strokes far better monetary policy has maybe the most potential to better lives, especially in the first world. I certainly hope the book can make NGDP targeting and market-based thinking (versus purely mechanical Keynesian) more mainstream. At least as mainstream as Piketty’s book was.

  65. Gravatar of dbeach dbeach
    13. January 2015 at 15:29

    Great news. Congratulations!

  66. Gravatar of A conjecture comes true | Historinhas A conjecture comes true | Historinhas
    13. January 2015 at 15:58

    […] And it has, thanks to Kenneth Duda […]

  67. Gravatar of Rajat Rajat
    13. January 2015 at 16:01

    Congratulations, Scott and Mark and kudos to Ken for putting his money into a cause he feels strongly about.

    It sounds like a great opportunity and in truth, represents the sort of recognition you no doubt deserved a long time ago and probably would have received if the world were a different place…

    I can’t help feeling a bit sorry for the students who will miss out on your insights, but you’ve given them much of your life. Hopefully, your replacement will be half as good. I take it you’re stopping teaching immediately – ie not teaching in the coming semester?

    Now re your book, Scott – NGDP targeting and MM is great but what about the book on the Great Depression we’ve been hearing about for so long?? Still forthcoming?

  68. Gravatar of dwb dwb
    13. January 2015 at 16:12

    Congratulations! I think the next 10 years will be fantastic for pragmatic libertarianism – the Friedman kind. Good luck! My two cents is that the implications of monetary policy in a low inflation world is that people will be looking for concrete ways to unlock labor productivity and more efficient land use, esp in the northeast and urban CA. The old style “we need to raise wages through a mandate” just won’t work, the Fed will squash it. living standards will have to go up the old fashioned way, by extracting more value out of resources.

  69. Gravatar of ChrisA ChrisA
    13. January 2015 at 16:28

    Wow. Its very rare that I read a post and then get a huge smile on my face. What a great result!

    Kenneth – you rock man!

  70. Gravatar of Saturos Saturos
    13. January 2015 at 17:21

    Thanks Kenneth and congratulations to Scott, although I feel for the incoming batch of students who will just miss out on having Scott as a professor. I’m glad you got Mark to help with the book, though! Does this mean that Tyler might have you as Director of Monetary Policy direct some researchers who are opposed to market monetarism?

  71. Gravatar of tesc tesc
    13. January 2015 at 17:55

    Congrats Sumner

    The best part of all is that Major Freedom did not comment on this post.

    Please Ken keep putting resources into MM. That seems to be the only way to get Major Freedom out of this blog.

  72. Gravatar of Major.Freedom Major.Freedom
    13. January 2015 at 18:16

    Haha! Tesc, I am the man of your dreams it seems. A blogpost that has absolutely nothing to do with me, something about Sumner’s personal life, and yet I am name dropped.

    Methinks my ideas are firmly entrenched into your mind.

    That is a good thing of course.

  73. Gravatar of Lorenzo from Oz Lorenzo from Oz
    13. January 2015 at 18:20

    Congratulations! Now, any chance of some kind entrepreneur buying your publisher? Or something. 🙂

  74. Gravatar of Richard Besserer Richard Besserer
    13. January 2015 at 19:07

    Congratulations, Scott.

    It occurs to me that if one can now get an endowed chair at a university of national renown on the strength of one’s economics blogging alone, blogging has finally arrived as a means of scientific communication!

  75. Gravatar of Don Geddis Don Geddis
    13. January 2015 at 19:47

    Congratulations, Scott! I fantastic choice for you personally, and for the world at large. However good you were at teaching, and however much you enjoyed it, you couldn’t possible affect more than a few hundred lives that way. Whereas you’re almost uniquely positioned, out of the billions in this world, for driving home an improvement of monetary policy that could significantly aid hundreds of millions of people. It’s a great choice.

    Great thanks to Ken Duda for enabling this wonderful option. I actually have met Ken in real life (!), but didn’t know anything about this amazing generosity until the post. What an incredible example of highly leveraged, carefully targeted charity.

    And then — as if that weren’t enough — we also get Mark Sadowski as an assistant, and Sumner gets personal interactions with Tyler Cowen and probably the rest of the GMU econ superstars (e.g. Alex Tabarrok, Robin Hanson). Sumner’s efforts would have been exciting enough on his own, but imagine what can be accomplished with the help of all that brainpower.

    This may be the most positive economic news that we’ve heard, since the start of the financial crisis. Well done, all! Congratulations all around.

  76. Gravatar of tesc tesc
    13. January 2015 at 19:58

    Mea culpa

    : )

    Now on the serious side. Masonomics + Market Monetaria = Awesome.

    Great work Dr. Sumner.

  77. Gravatar of Negation of Ideology Negation of Ideology
    13. January 2015 at 20:02

    Congratulations Scott! And congratulations to Ken Duda and the Mercatus Center for hiring a future Nobel Prize winner!

    I’m looking forward to both books.

  78. Gravatar of Gordon Gordon
    13. January 2015 at 21:36

    Congratulations Scott! I wholeheartedly agree with Ken that an improvement in nominal stability will improve the lives of many. Though I suspect these people will never ever realize it if it does come about. I still see many of the old non-monetary explanations about the Great Depression being bandied about in the general public – even from a friend who has better economic knowledge than the average person.

  79. Gravatar of mbka mbka
    13. January 2015 at 22:43


    that is really great, congratulations. In many ways you have shown that even a single person can change a lot of things if (s)he just pushes hard enough, and even if its not from a position of power. I’m looking forward to the book too. Books are really important, especially the kind read by a large number of people. It’s the only way to implant fundamental ideas into society.

  80. Gravatar of Ognian Davchev Ognian Davchev
    13. January 2015 at 22:59

    Big thanks to Ken Duda! This couldn’t happen to better people. Congrats Scott and Mark!

  81. Gravatar of Scott Sumner has a new gig, director of a new monetary policy program at the Mercatus Center « Economics Info Scott Sumner has a new gig, director of a new monetary policy program at the Mercatus Center « Economics Info
    14. January 2015 at 01:03

    […] Source […]

  82. Gravatar of James in London James in London
    14. January 2015 at 01:39

    Fantastic news. Those guys at Harvard and Oxford always knew you were a free market stooge, now they have their “proof”. Of course the guys at Oxford receive no money from the government and in no way show any bias in favour of their paymasters. Oh no, no, no.

  83. Gravatar of J.V. Dubois J.V. Dubois
    14. January 2015 at 02:04

    More bloggin/reasearch from you AND well deserved research job for Mark Sadowski. I am delighted. Congratulations 🙂

  84. Gravatar of Derivs Derivs
    14. January 2015 at 02:09

    “knew you were a free market stooge”

    I’m now understanding why this is one of the only ‘academic’ econ blogs where most things make sense to me.

    “Of course the guys at Oxford receive no money from the government and in no way show any bias in favour of their paymasters. Oh no, no, no.”

    Ah, that explains the hostile reaction from WL my simple ledger accounting question as to ‘where is +G going to come from? Taxes?” I assume the answer is somewhere in the 101 level Keynesian textbook he recommended for me.

  85. Gravatar of bill woolsey bill woolsey
    14. January 2015 at 03:46

    Great news.

  86. Gravatar of James in London James in London
    14. January 2015 at 05:30

    Dervis. Borrowing from the market if possible. From you central bank if necessary. And that is wholly different from when the central bank is legally a direct arm of the Treasury. When independent, and recognised as such it is monetary policy. But the very independence means they will offset in an IT world.

  87. Gravatar of grim23 grim23
    14. January 2015 at 06:25

    i havent been following economics as closely as i was when i was still fresh from studies last year. glad to see that market monetarism is gaining the foothold our economies deserve. in a few years time scott sumner will be one of the most influential economists in the world ….. nobel prize maybe?

  88. Gravatar of Derivs Derivs
    14. January 2015 at 06:37

    James – Thanks, I knew the options. My little lizard brain has been programmed to demand to see the offsets spelled out for me as they are proposed. Since it wasn’t explicitly stated, I asked.

    Scott- Congratulations, It’s always nice to find the outlet that allows you to pursue your passions. It’s truly the only way work is not a four letter word. My passion was always ‘price’ which yesterday, entertainingly, I read your sentiments on.

    I am thoroughly enjoying your writing as I am slowly making my way to the design of your NGDP futures contract. To see an economist even write the words “market-driven monetary-policy regime” gives me warm fuzzies. If I ever see an economist reference the word ‘contango’ when discussing interest rates and inflation I might just not be able to handle that.

    I would like to add a perspective to your comments about “the Great Moderation” period, and the Fed “deciding on a preferred inflation rate and steering the economy toward it, generally by lowering interest rates when inflation fell below the target and raising interest rates when inflation exceeded the target.”

    I remember, in the mid 90’s, when I was a member of the Board of Trade, how many times I heard the argument that the Fed just simply followed the market.

    It’s easy to think about Fed – Market in terms of a chicken-egg feedback loop, where one side is constantly reading the other for clues. With business news informing people that the market is pricing in a 100% chance of a Fed change in rates of X at the next meetig, with a 50% chance of Y in the subsequent meeting it becomes even easier to believe that the market is following/front-running(?) the Fed.
    So then the question becomes, what would the market be doing if there was no Fed. With no Fed, investors expectations of inflation would still determine yield requirements, inflation would still remain as the arch enemy to a bond, and the first whiff of inflation would still naturally cause yields to rise to compensate for inflation risk. With the converse being true as inflation fades.

    So why credit the Fed for doing something that the market seeks to do naturally, did daily, and always seemed to be doing ahead of the Fed i.e, “the reference to – 100% of expectations being already priced in”.

    Once again, Congrats!

  89. Gravatar of ssumner ssumner
    14. January 2015 at 07:09

    Thanks everyone, really appreciated. Commenters have certainly helped me a lot over the years.

    Sean, I’d be happy living in oz.

    Pietro, I’m agnostic on that, and don’t expect much effect either way (because I think low prices reflect both supply and demand factors.)

    Rajat, I’ll stop teaching immediately and I hope the book comes out in 2015, but I said that in 2013 and 2014 . . .

    Saturos, Anything is possible.

    Richard, It’s not an endowed chair in the sense of a teaching chair.

    Derivs, Think of the question of “following the market” as being a matter of degree. When they have a sensible target, the more they follow the market the more effective they will be. Perhaps that’s why it looked that way during the Great Moderation.

  90. Gravatar of Why NGDP Targeting Won’t Work in Reality | Monetary RealismMonetary Realism Why NGDP Targeting Won’t Work in Reality | Monetary RealismMonetary Realism
    14. January 2015 at 12:04

    […] to Scott Sumner on his new career and fund raising for a NGDP futures market. It looks like his dream of NGDP targeting could really […]

  91. Gravatar of John S John S
    14. January 2015 at 12:48

    NGDP targeting,
    Duda, Duda,
    NGDP targeting,
    All the Duda-day

  92. Gravatar of TravisV TravisV
    14. January 2015 at 13:14

    Cullen Roche: “Why NGDP Targeting Won’t Work in Reality”

  93. Gravatar of Daniel Daniel
    14. January 2015 at 13:38

    Cullen Roche is sorely in need of a few functioning brain cells.

  94. Gravatar of Becky Hargrove Becky Hargrove
    14. January 2015 at 13:51

    John S,
    I will probably have “Camptown Races” stuck in my head for the rest of the Duda-day!

  95. Gravatar of Philippe Philippe
    14. January 2015 at 14:50


    “So, expectations of higher NGDP must naturally lead to expectations of tighter Fed policy which could lead to lower NGDP expectations.”


  96. Gravatar of Nomimal GDP Targeting: Solution for Recession? | ESEADE Nomimal GDP Targeting: Solution for Recession? | ESEADE
    14. January 2015 at 15:11

    […] For those who would like a primer on the commitment and the increasing importance of nominal GDP targeting at 5% as a rule for monetary policy, Scott Sumner, the leading proponent of market monetarism just posted this interesting blog post http://econlog.econlib, “Implications of zero interest rates for monetary and fiscal stimulus”. At the end of this post Professor Sumner announces he will be directing a program on monetary policy at the Mercatus Center to better and more effectively promote nominal GDP targeting. He provides more detail on the new program at his main blog, The Money Illusion. […]

  97. Gravatar of Tom Brown Tom Brown
    14. January 2015 at 16:06

    Congratulations Scott!

  98. Gravatar of From long ago: What´s NGDP? | Historinhas From long ago: What´s NGDP? | Historinhas
    14. January 2015 at 16:42

    […] Now there´s “light”: […]

  99. Gravatar of Mike Sax Mike Sax
    14. January 2015 at 18:19

    Congratulations Scott. Let’s hope Kevin Duda is right and your work does lead to a better world.

  100. Gravatar of Riccardo Leggio Riccardo Leggio
    14. January 2015 at 21:39

    I’m happy for you, way to go!

  101. Gravatar of rob rob
    14. January 2015 at 23:40

    Congratulations! They are certainly lucky to have you! Also I am glad someone else shares the same opinion about GMU that I have!

  102. Gravatar of Larry Larry
    15. January 2015 at 07:59

    Great news! Hope this is a marriage made in heaven. Also great to see Mark coming along. Viva NGDPT.

  103. Gravatar of ssumner ssumner
    15. January 2015 at 09:16

    Thanks everyone.

  104. Gravatar of StatsGuy StatsGuy
    15. January 2015 at 20:23

    About. Frickin. Time.


    Progress is so slow… You’re not done yet!

  105. Gravatar of RebelEconomist RebelEconomist
    16. January 2015 at 04:35

    Well done, Scott. I always worry that NDGP targeting is attractive to policymakers right now because it gets them off the hook of the inflation target so I am sceptical at present, but, as someone who struggled with the exclusive attitude of academic economics to people who have a different approach (in my case, a kind of mechanistic approach based on detailed investigation of how the system works in practice) I am delighted to see someone supported to develop and make their case.

  106. Gravatar of W le B W le B
    16. January 2015 at 05:36

    Congratulations!!! And thanks to Mr Duda. Interesting use of the classic “Orange County Real Estate Hunting ‘feint'” that put so many of us off the trail.

  107. Gravatar of ssumner ssumner
    16. January 2015 at 07:22

    Thanks Rebeleconomist and W le B.

  108. Gravatar of Mike Sax Mike Sax
    18. January 2015 at 06:57

    Again, Scott congratulations, and I do hope you’re successful even if we’ve had our disagreements. I’ve never said that you’re wrong just that I’m not certain that you’re right. Maybe when I comment on this blog I sound wrong-I’m really not arrogant at least if by arrogant you mean someone who thinks they know everything: I know I don’t know everything far from it. Honestly, I’m just an intellectually curious guy. I will admit that if I feel like I’m attacked I get a little ticked off. In that maybe you and I are too alike

    While I hope you’re successful I do have on gripe: now that you’re not a professor anymore I can’t crash you’re class one day, like I had imagined doing a few times when I had the time to go to Bentley, Mass.

  109. Gravatar of Mike Sax Mike Sax
    18. January 2015 at 07:00

    “Honestly, I’m just an intellectually curious guy. I will admit that if I feel like I’m attacked I get a little ticked off. In that maybe you and I are too alike.”

    I do have a real desire to understand the world. But on your blog at least I seem to have a hard time disagreeing without coming across as disagreeable. So for that reason usually I read you which I do enjoy but try to avoid making comments that seem too often to generate lots of heat but little light.

  110. Gravatar of NGDP Level Targeting? James Meade understood it almost 40 years ago! | Historinhas NGDP Level Targeting? James Meade understood it almost 40 years ago! | Historinhas
    19. January 2015 at 15:39

    […] took a long time, but now a Center for research on NGDP targeting has been […]

  111. Gravatar of Rien Huizer Rien Huizer
    1. February 2015 at 01:46

    Scott, congratulations. Hope you will aspire to high Masonic standards!

  112. Gravatar of April Presentation | The Discussion Club April Presentation | The Discussion Club
    21. April 2015 at 08:23

    […] that capacity he published extensively in academic journals. Now he will be the director of a new Mercatus Center program focused on monetary […]

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