Uncertainty and the Recession: Who is denying that weak demand is a factor, or even the larger factor of the two?
Two weeks ago, during my Barclays-sponsored debate in Washington DC, Harvard's Robert Barro told me that he thought that weak demand was a much less important factor than regulatory and budget uncertainty.
The day before yesterday, in conversation, the University of Chicago's Kevin Murphy told me that he believed that demand was now a secondary factor.
The entire Republican Party that is warning Ben Bernanke not to take any additional step to increase nominal spending via monetary policy is denying that weak demand is a factor--or acknowledging that weak demand is a factor and hoping to make demand even weaker to push unemployment up.
Clive Crook really does not look and listen at the world he lives in, does he?
Why oh why can't we have a better press corps?