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Wednesday, January 14, 2009

Randy Parker Hall of Fame: Robert Lucas


This little gem from Nobel Prize winner Bob Lucas was published December 23 and slipped under the radar. This is really a great piece.

6 comments:

ArmChairEconomist said...

What does the good Doc think about the claim that monetary excess(from low Fed Funds rates and drastic increases in the MS from 2001 - 2005 which was mostly during the Greenspan era) helped create the financial crises we are currently experiencing by further inflating the housing bubble. Or were such actions needed, just, and required during these times?

Randall Parker said...

Armie: How could it be viewed otherwise? But most importantly, it was the new financial innovation that was supposed to reduce systemic risk that indeed did the exact opposite. Moreover, you can't have a bubble without a bunch, and I mean a bunch, of jackasses thinking housing prices would do nothing but increase forever.

formerCEO Franklin Delano Raines said...

Hey, you forgot to put blame on a particular friend of ours who presides over Massachusetts's 4th congressional district along with the institutions he supports.

Randall Parker said...

Franklin: Of course! How could I forget? If you will notice the archives of my blogs, you will see I have one special just for Barney. Indeed he and the creatures of Congress that took away any moral hazard from the market deserve most of the blame. Take away the negative consequences of people's actions and you fill the world with fools.

Randall Parker said...

Franklin: I got a special blog archive coming just for you too.

formerCEO Franklin Delano Raines said...

UH-OH!, Be easy on me Doc!