Department of 'Huh?!": Unemployment Numbers Edition
The Girl Who...

Mark-My-Beliefs-to-Market Time: I Should Make This an Annual Observance

Things that I think I have gotten really, really wrong so far in my career:

  1. My belief that central banks had the tools, the skill, and the political will to stabilize economies at high levels of employment and low levels of inflation, and thus that fiscal policy and financial institutions policy no longer had any compelling stabilization policy role to play.

  2. My belief that large, leveraged financial institutions had sufficient caution and sufficient control over their derivatives books that their derivative positions did not pose major systemic risk.

  3. My belief that the principal threat to the world economy would come from the fact that in a crisis the shaky long-term finances of the U.S. social insurance state might provoke a collapse of confidence in the long-term value of the dollar.

  4. My belief that closer economic integration between Mexico and the U.S. would be, while a rough ride for Mexico, a clear net plus for Mexico.

  5. My belief that economists as a group understood as much about the causes of recessions and depressions as John Stuart Mill understood in 1829: that a downturn is a shortfall of planned spending at full employment below income caused by an excess demand for financial assets, and it is cured by either (a) having the government do the spending-in-excess-of-income that the private sector will not, or (b) having the government flood the zone with financial assets so that there is no longer an economy-wide excess demand for them.

  6. My belief that pushing neoliberal, market-opening reforms on countries like Argentina in the 1990s was not a policy as wise as giving a supply of gasoline to a bunch of pyromaniacs.

  7. My belief that the rapid growth of the Japanese economy in the 1970s and 1980s would continue into the 1990s and 2000s.

  8. My belief that the 6% unemployment NAIRU of the U.S. in the 1970s and 1980s would continue into the 1990s and 2000s.

  9. My belief around 1990 that the rapid privatization of Russian industry was the best chance to set up a favorable political dynamic that would lead to rapid economic recovery and political development in Russia.

  10. My belief that, automatic stabilizers aside, fiscal policy no longer had a legitimate countercyclical role to play because the Federal Reserve and other central banks were mighty and powerful and could and would act appropriately inside fiscal authorities' decision loops.

  11. My belief that no advanced country government with as frayed a safety net as America would tolerate even near-double digit unemployment for years.

Any others to suggest?