Papers to read

Via Marginal Revolution

On a banking glut.  On excessive financing.  Both arguing against the “excessive savings” view of the crisis – which is currently my prior.

Will be reading these (rereading in the case of the second one) in order to avoid listening to more crap about the NZ election … seriously, I didn’t realise how much politicians lie during an election till I became an economist, and I’m still uncomfortable with it.

FYI:  I agree with the description of macroprudential policy, but I remain nervous about the “time series” policies – which are really just non-interest rate cyclical tools.  We need a significant burden of proof before these instruments can be used – although I suspect at present monetary authorities are aware of this.