Odd from the usually-reliable and very smart Mohamed A. El-Erian. Yes, the great and good were much too optimistic a year ago—but that is not economists' fault, save for those economists who have betrayed their calling by becoming cheerleaders for Trump, Brexit, austerity, and plutocracy. Yes, the Federal Reserve needs reform—but its decisions that it does not are not the fault of we outsiders who have been pointing out how it might do better. And on Trump's trade war with China... the major things that need to be said are political and administrative: Trump and his administration are incompetent, and everything they touch turns to s---, so game-theoretic and welfare-economic disquisitions on how to manage trade are simply beside the point:

Mohamed A. El-Erian: Why Economics Must Get Broader Before It Gets Better: "In...12... went from celebrating a synchronized global growth pickup to worrying about a synchronized global slowdown.... Neither the extent nor the speed of the change in consensus seems warranted by economic and financial developments, which suggests that economists may have misdiagnosed the initial conditions.... Professional economists still have not spoken up clearly enough about the challenges facing the US Federal Reserve’s communication strategy.... Economists should be urging the Fed to adopt an approach more like that of the Bank of England, which emphasizes scenario analyses and fan charts. Economists could also be doing more to inform–and perhaps even influence—the Fed’s ongoing review of its policy frameworks and communications strategy.... The Sino-American trade conflict.... The vast majority of economists have trotted out the conventional argument that tariffs (real or threatened) are always bad.... Those who wanted to make a productive contribution to the debate should have taken a more nuanced approach, applying tools from game theory to distinguish between the 'what' and the 'how' of trade warfare. These are just three recent examples of how economists have dropped the ball...


#noted

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