{"id":274354,"date":"2010-02-03T07:56:16","date_gmt":"2010-02-03T12:56:16","guid":{"rendered":"http:\/\/blogs.wsj.com\/economics\/2010\/02\/03\/secondary-sources-stimulus-debate-volcker-rule-loopholes-bloggers\/"},"modified":"2010-02-03T07:56:16","modified_gmt":"2010-02-03T12:56:16","slug":"secondary-sources-stimulus-debate-volcker-rule-loopholes-bloggers","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/274354","title":{"rendered":"Secondary Sources: Stimulus Debate, Volcker Rule Loopholes, Bloggers"},"content":{"rendered":"<p><em>A roundup of economic news from around the Web.<\/em><\/p>\n<ul>\n<li><a href=\"http:\/\/www.themoneyillusion.com\/?p=4104\"><strong>Stimulus Debate:<\/strong><\/a> <strong>Scott Sumner<\/strong> says the debate over stimulus is too focused on fiscal, not monetary, stimulus. &#8220;I happen to favor more stimulus, although I understand that some thoughtful economists disagree with me.  I happen to think monetary stimulus is preferable to fiscal stimulus, and in this case there aren\u0092t any thoughtful economists who disagree with me.  Not one.  If there was going to be one, it would be Paul Krugman.  But even he admitted late last year that monetary stimulus is the first choice, and you only move on to fiscal stimulus is the Fed won\u0092t play ball. So here is the debate:  Do we need more monetary stimulus, or should we let the economy recover naturally.  But DeLong wants to say the debate is between fiscal stimulus and stagnation.  How can he do that?  Buy simply assuming away monetary stimulus.  Presumably he would say that Obama doesn\u0092t control monetary policy, so he can hardly be blamed for relying on fiscal stimulus.  Has Obama made a single public statement calling on the Fed to promote higher NGDP growth, or higher inflation, or higher whatever?  And then there is the little problem that Obama just re-appointed Ben Bernanke last month.  Bernanke\u0092s now his guy at the Fed.&#8221;<\/li>\n<li><a href=\"http:\/\/blogs.reuters.com\/felix-salmon\/2010\/02\/03\/the-volcker-rules-loopholes\/\"><strong>Volcker Rule Loopholes:<\/strong><\/a> <strong>Felix Salmon<\/strong> notes loopholes in the proposed Volcker rule. &#8220;Firstly, the Volcker rule seems to apply only to depositary institutions: if you don\u0092t take deposits, then you\u0092re exempt. The result is that it\u0092ll be easy for Goldman Sachs and Morgan Stanley to get around the rule just by returning their current (tiny) deposit base and voluntarily withdrawing from access to the Fed\u0092s discount window. But the point here is that banks with deposit bases are already insured and regulated, by the FDIC. The definition of a bank isn\u0092t an entity which takes deposits; it\u0092s an entity which borrows short and lends long. So long as the likes of Goldman Sachs can fund themselves in the wholesale market and continue to lend money to large clients in things like the syndicated loan market, they\u0092re banks, and they should be subject to rules like Volcker\u0092s which apply to banks. Secondly, it seems that banks might be allowed to continue to own hedge funds, private-equity funds, money-market funds, and the like, just so long as they\u0092re run for clients, with client money, rather than being vehicles for the investment of the bank\u0092s own capital. This too is dangerous, because the history of the financial crisis is clear: Bear Stearns ended up bailing out its internal hedge funds even when it didn\u0092t legally have to.&#8221;<\/li>\n<li><a href=\"http:\/\/www.kauffman.org\/newsroom\/economics-bloggers-share-bleak-outlook-according-to-kauffman-foundation-survey.aspx\"><strong>Econobloggers:<\/strong><\/a> The <strong>Kauffman Foundation<\/strong> surveyed econobloggers and found them to be a pessimistic lot. &#8220;The bloggers expect the greatest growth prospects over the next three years to be in interest rates, inflation and the budget deficit. U.S. output and jobs are expected to increase, but with about half the intensity of growth in global output. The panel assesses conditions as &#8220;bad&#8221; or &#8220;very bad&#8221; for small business (52 percent) and bank lending to business (51 percent) and individuals (50 percent). The outlook for entrepreneurs is a relative bright spot, with opinions mixed between bad conditions (36 percent) and good (26 percent).&#8221;<\/li>\n<\/ul>\n<p><strong>Compiled by <a href=\"mailto:philip.izzo@wsj.com\">Phil Izzo<\/a><\/strong><\/p>\n<p><a href=\"http:\/\/feedads.g.doubleclick.net\/~at\/H6Ksrel1kC26weVTLPXu6HM0Vf8\/0\/da\"><img decoding=\"async\" src=\"http:\/\/feedads.g.doubleclick.net\/~at\/H6Ksrel1kC26weVTLPXu6HM0Vf8\/0\/di\" border=\"0\" ismap=\"true\"><\/img><\/a><br \/>\n<a href=\"http:\/\/feedads.g.doubleclick.net\/~at\/H6Ksrel1kC26weVTLPXu6HM0Vf8\/1\/da\"><img decoding=\"async\" src=\"http:\/\/feedads.g.doubleclick.net\/~at\/H6Ksrel1kC26weVTLPXu6HM0Vf8\/1\/di\" border=\"0\" ismap=\"true\"><\/img><\/a><\/p>\n<div class=\"feedflare\">\n<a href=\"http:\/\/feeds.feedburner.com\/~ff\/wsj\/economics\/feed?a=3uAzlBBeCjE:UQz-gAnYWVM:yIl2AUoC8zA\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/wsj\/economics\/feed?d=yIl2AUoC8zA\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/wsj\/economics\/feed?a=3uAzlBBeCjE:UQz-gAnYWVM:F7zBnMyn0Lo\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/wsj\/economics\/feed?i=3uAzlBBeCjE:UQz-gAnYWVM:F7zBnMyn0Lo\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/wsj\/economics\/feed?a=3uAzlBBeCjE:UQz-gAnYWVM:V_sGLiPBpWU\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/wsj\/economics\/feed?i=3uAzlBBeCjE:UQz-gAnYWVM:V_sGLiPBpWU\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/wsj\/economics\/feed?a=3uAzlBBeCjE:UQz-gAnYWVM:qj6IDK7rITs\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/wsj\/economics\/feed?d=qj6IDK7rITs\" border=\"0\"><\/img><\/a>\n<\/div>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~r\/wsj\/economics\/feed\/~4\/3uAzlBBeCjE\" height=\"1\" width=\"1\"\/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A roundup of economic news from around the Web. Stimulus Debate: Scott Sumner says the debate over stimulus is too focused on fiscal, not monetary, stimulus. &#8220;I happen to favor more stimulus, although I understand that some thoughtful economists disagree with me. I happen to think monetary stimulus is preferable to fiscal stimulus, and in [&hellip;]<\/p>\n","protected":false},"author":850,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-274354","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/274354","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/850"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=274354"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/274354\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=274354"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=274354"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=274354"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}