HERE A MODEL, THERE A MODEL, EVERYONE HAS A DIFFERENT FORECASTING MODEL: Forecasters Trim Growth Outlook - Barrons.com
Somehow it seems as though Gene is the perpetual optimist and often wrong!
Somewhere else this week there is a mention of 1980 and it would seem as though Gene and many of those making growth projections are following the 1970's pattern of looking back and taking that information to project the future.
In the 1970's this resulted in continuing to underestimate the level of interest rates and inflation.
It would be very hard to run econometric projection models today because there are clearly disparate views of what the economy needs and doesn't need.
Just one comparison would be the opposite views of the Keynesians and Art Laffer.
Bernanke would seem to be in the Monetarism school and what he's been doing hasn't worked!
So, which data should guide a projection of the future. Obama and his crew have certainly gotten things wrong since he came into office.
I'd say Laffer has been on the money and I can't see his model projecting growth?
Saturday, August 13, 2011
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