Could Bernanke engineer a soft landing?

[blazespinnaker]

The markets are betting on it.

Inflation is a lagging indicator, and if Bernanke has correctly timed his pause, we may find that the economy slows down just as those pauses (and soon cuts) come into effect.

(been watching a lot of pimco videos lately..)

[Finster]

Re: Could Bernanke engineer a soft landing?

The markets are betting on it.

Inflation is a lagging indicator, and if Bernanke has correctly timed his pause, we may find that the economy slows down just as those pauses (and soon cuts) come into effect.

(been watching a lot of pimco videos lately..)

More accurately, conventional inflation statistics are lagging indicators. Just happens that consumer prices stand about at the end of the line in the price effects of inflation. It first shows up in places like stock prices and home prices, which are not included in the CPI.

As for a "soft landing", depends on how you define it. Probably most would consider a decline in consumer spending a "hard landing", but considering consumption is running some 7% in excess of production, that's just what the doctor ordered.

[blazespinnaker]

Re: Could Bernanke engineer a soft landing?

I think soft landing is code word for no recession.

[Finster]

Re: Could Bernanke engineer a soft landing?

I think soft landing is code word for no recession.

We may have embarked on an endless succession of meanings, but the term "recession" is a pretty sloppy one, too. You mean where the NBER gets together, has some meetings, and then pronounces that we had a recession? - http://money.cnn.com/2001/11/26/economy/recession/ - http://en.wikipedia.org/wiki/Nationa...omic_Research" Or two consecutive quarters of GDP contraction? And would that be nominal or real GDP?

This may seem like obsessing over minutia, but consider how often and how casually economic pundits toss around terms like "soft landing" and "recession" as if they were meaningful. I don't think they are, and that questions like these need to be asked. These questions are exceedingly important, because policy regarding a multi-trillion-dollar economy is being made as if recessions are something to be avoided at all costs and soft landings are something to be desired.

Before we just jump on the bandwagon rooting for soft landings and recession-free lives, is it too much to ask that these pundits at least make an attempt to explain what they are and why we should all agree these objectives ought to be pursued?

[blazespinnaker]

Re: Could Bernanke engineer a soft landing?

This may seem like obsessing over minutia

It is but minutia is where all the money lies