Brad DeLong Debates Jim Grant on the need for QE3

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With the U.S. economy showing signs of softness as the Fed’s second round of “quantitative easing” is set to expire, many are asking whether a third round of stimulus is in order. Berkeley’s Brad DeLong and Jim Grant, of Grant’s Interest Rate Observer, offer their differing takes on whether QE3 is a good idea.

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10 Comments
  1. Fred says

    What DeLong derides as “hoarded cash” Grant understands as peoples’ life savings.

  2. Edward Harrison says

    Fred commented on Credit Writedowns:

    What DeLong derides as “hoarded cash” Grant understands as peoples’ life savings.

  3. john newman says

    DeLong wouldn’t know inflation if it bit him in the assets. While Jim is a hard money guy and I disagree with him about many things, he is certainly right that asset prices are being inflated by QE. On the other hand I’m with Delong on hoarding: the savings rate is as low in Japan as it is here: the vast majority of bonds there as here are held by financial institutions or governments, not aging savers, but Jim is right that it is the aging savers that are being hurt.

  4. flow5 says

    Grant is an engaging writer and market commentor but he doesn’t understand economics – he doesn’t believe anyone can predict interest rates.

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