Economics as a Professional Vocation

Should-Read: I disagree with the very sharp Gavyn Davies about the potential confirmation of the honorable and professional Marvin Goodfriend to the Board of Governors of the Federal Reserve. I think he would be a bad choice. Gavyn does not: Gavyn Davies: Marvin Goodfriend would be good for the Fed: "Prof Goodfriend has recently argued that the FOMC should explicitly compare its policy actions with the recommendations from... a rule...

...because this would reduce the tendency to wait too long before tightening policy. This places more emphasis on rules-based policies than Ms Yellen or Fed vice-chair Stanley Fischer would like, but he is not really a hardliner on this debate. Overall, Marvin Goodfriend would be a very good appointment to the board. He is in no way a political crony, and would stand up for the Fed’s basic role in maintaining stable prices. He is less of a gradualist on interest rate changes than Ms Yellen, and he may lean towards earlier monetary tightening than the current regime.

Marvin Goodfriend was one of those so wrong about the state of the economy and about what good monetary policy would have been in the first half of the 2010s that :I would only support his nomination if he had done a deep-dive rethinking of his intellectual and policy positions in response. And he has not. When your forecasts and projections are wrong, it means that the universe is telling you something important. You should listen. And I do not think he has sufficiently done so.