{"id":11451,"date":"2011-10-03T12:53:33","date_gmt":"2011-10-03T16:53:33","guid":{"rendered":"http:\/\/quotulatiousness.ca\/blog\/?p=11451"},"modified":"2011-10-03T11:57:19","modified_gmt":"2011-10-03T15:57:19","slug":"stephen-gordon-markets-are-volatile-but-governments-must-not-be","status":"publish","type":"post","link":"https:\/\/quotulatiousness.ca\/blog\/2011\/10\/03\/stephen-gordon-markets-are-volatile-but-governments-must-not-be\/","title":{"rendered":"Stephen Gordon: markets are volatile, but governments must not be"},"content":{"rendered":"

In his latest Economy Lab<\/em> post, Stephen Gordon<\/a> explains why governments should not leap into the breach every time the markets fluctuate:<\/p>\n

\n

Politicians and pundits have jumped upon the recent flurry of bad news from financial markets to demand that the federal government \u201cdo something\u201d — although just what that something should be is far from clear.<\/p>\n

But no sensible government ever makes policy on the basis of a few bad days or weeks on the market, because financial markets are a notoriously unreliable predictor of the real economy. As the great economist Paul Samuelson once noted, \u201cstock markets have predicted nine of the past five recessions\u201d. I don\u2019t know when he said this, but I first heard the quote when I was a graduate student 25 years ago, and its applicability seems timeless. To a very great extent, the day-to-day movements in markets are the result of random chance, and attempts to fit them into a narrative aren\u2019t always convincing. <\/p>\n<\/p>\n<\/blockquote>\n","protected":false},"excerpt":{"rendered":"

In his latest Economy Lab post, Stephen Gordon explains why governments should not leap into the breach every time the markets fluctuate: Politicians and pundits have jumped upon the recent flurry of bad news from financial markets to demand that the federal government \u201cdo something\u201d — although just what that something should be is far […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[25,84],"tags":[661],"class_list":["post-11451","post","type-post","status-publish","format-standard","hentry","category-economics","category-government","tag-regulation"],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p2hpV6-2YH","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/11451","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/comments?post=11451"}],"version-history":[{"count":1,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/11451\/revisions"}],"predecessor-version":[{"id":11452,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/11451\/revisions\/11452"}],"wp:attachment":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/media?parent=11451"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/categories?post=11451"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/tags?post=11451"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}