Scott Sumner Blog | Talkmarkets | Page 1
Chair of Monetary Policy
Contributor's Links: The Money Illusion

Scott Sumner is the Ralph G. Hawtrey Chair of Monetary Policy at the Mercatus Center at George Mason University.  He is also Professor Emeritus at Bentley University and Research Fellow at the Independent Institute. In his writing and research, Sumner specializes in monetary policy, the ... more

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The Jobs Report No One Saw Coming
Because millions of unemployed workers in low pay service sector jobs earn more on unemployment than they did on their previous jobs, employment will likely remain quite depressed all summer, before bouncing back in the fall.
Fiscal Policy And Interest Rates
Yellen did not say that the Fed should raise interest rates, rather she suggested that an expansionary fiscal policy and a recovering economy might put upward pressure on interest rates at some point in the future.
Taxing A Lovely Bunch Of Coconuts
Why I dislike capital gains proposals.
Capital Gains Nonsense
A wage tax essentially taxes current and future consumption at the same rate. A capital gains tax taxes future consumption at a higher rate than current consumption.
What The Wage Data Is Telling Us
During a normal demand-side recession, wage growth tends to fall sharply, with a modest lag due to nominal wage stickiness.
Teenage Employment Has Bounced Back
Today, teenagers are less likely to choose to work than back in the 20th century, when teen participation rates were higher. 
How News Affects Markets
I’m not surprised that monetary policy is important, or that the effects are asymmetric.
The Summer Of 2021
By June 6th, everyone who wants a vaccine will have had at least one shot. People will still be dying of COVID, but the situation will seem much different. People will begin to act like the pandemic is over. But what will the new normal look like?
What Causes Recessions?
The most effective way to prevent recessions (except the Covid recession) is to stabilize 1-year forward NGDP growth expectations at around 4%/year. So in that sense, recessions are caused by sharp declines in NGDP growth.
No, The Unemployment Rate Is Not "Meaningless"
In March, the economy created 916,000 new jobs and the unemployment rate edged down to 6%. At the same time, total employment remains roughly 10 million below trend.
The Professor Vs. The Markets
The fact that Turkey’s currency depreciated does not necessarily mean it was a bad decision. 
Will The Fed Follow Its Rhetoric Or Its Rule?
The Fed has increasingly adopted 1960s Keynesian rhetoric. Go for growth. Don’t worry about a bit more inflation. Jobs are much more important. Given that 1960s Keynesianism gave us the Great Inflation, should we be worried about today’s rhetoric?
AIT Is Increasingly Credible
The TIPS markets are showing evidence that investors expect 2% PCE inflation over 30 years, and somewhat higher inflation over the next 5 years.
Internal Contradictions In Progressivism
In fact, all the recent energy among progressives has been in exactly the opposite direction, that we should borrow more to finance current consumption. In the very short run, those policies might boost real output.
Suggestions For The Reserve Bank Of New Zealand?
The government of New Zealand recently added housing prices to their central bank’s mandate.
Will We Have High Inflation In The 2020s?
It’s all about monetary policy. When it comes to inflation, fiscal policy doesn’t matter. Globalization doesn’t matter. Unions and minimum wage laws don’t matter. It’s completely up to the Fed.
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