Noted for Your Morning Procrastination for September 27, 2014
Morning Must-Read: Paul Krugman: The New Classical Clique and the Insulation of International Macro

Morning Must-Read: Felix Salmon on Martin Wolf's "The Shifts and the Shocks"

Felix Salmon: A Radical Response: "Martin Wolf paints a picture of a global economy being wrecked both by freedom of capital...

...and by the imprisonment of 18 European countries in a fixed currency system.... It’s a worldview in which central bankers, rather than their commercial brethren, are the people who really determine whether the world crashes and burns: The Jamie Dimons simply end up acting in accordance with the incentives that the Alan Greenspans put in place.... Wolf... has withering scorn for what central bankers have wrought... persuasively argues that central banks should target a much higher rate of inflation, noting that, in the eurozone, “inflation of 3 to 4 percent a year would not be a disaster” and would actually be very helpful.... Wolf... says the French economist Thomas Piketty’s recommendation of a global wealth tax “is unquestionably too ambitious.” Yet Wolf’s own recommendations are more ambitious... attempts to prevent corporations from accumulating cash; an end to the tax-deductibility of interest payments; a scaling back of international banks... a mass refinancing of European sovereign debt into eurobonds... a radical change in debt contracts to make them much more equitylike; and, of course, that idea about abolishing ­fractional-reserve banking.... Despite Wolf’s attempts to don the garb of a revolutionary, this book is actually something more familiar, and more depressing: a wonkish eschatology of how the global economy, and Europe’s in particular, is doomed.... THE SHIFTS AND THE SHOCKS: What We’ve Learned — and Have Still to Learn — From the Financial Crisis. By Martin Wolf.