Tuesday, May 1, 2012

I'm Going After Bob Murphy, Again

A couple of days ago, Murph emailed me:
let's get ready to ruuuuuuuuumble 
Just making sure you don't get a big head from the NY Fed speech:
http://consultingbyrpm.com/blog/2012/04/wenzel-vs.-murphy-you-decide.html
I emailed back:
 helpful hint: I would recommend you father any children you plan on having,
 before I post.
I haven't actually read, yet, what Murphy has to say. It has been pretty hectic, but I plan on blowing him up, either tomorrow or Wednesday.

8 comments:

  1. LOL. Now that's some great commentary. I'll be honest, I think Bob may have you on a technicality here, and it isn't too far off from what I was saying back then, either (esp. consumer prices vs. the capital structure/investment). Unfortunately for me, I'm not knowledgeable enough to elaborate upon it like you and Bob, so this should be interesting.

    I hope people don't start bitching about how Austrians shouldn't debate Austrians or we should all hold hands and sing 'Kumbaya' or something. Because, I really like these Austrian debates, they interest me far more than anything Krugman has to say, that is for sure.

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  2. A minor observation:

    B.M. wrote, "Businesses likely pulled forward much of their planned equipment amd software purchases—which normally would have occurred in early 2005—into 2004, to take advantage of the expiring 50% bonus depreciation."

    I thought much of it was due to the shift to the long file names Windows 95 supported, which required new PC's and peripheral equipment, rather than depreciation advantage.

    Consumers made the same move.

    B.M. wrote, "there was strong growth through 2004 (with fourth-quarter 2004 equipment & software investment up 12.1% from the prior quarter), but then an abrupt slowdown going into first quarter 2005, when this investment category only rose 2.4%"

    ... When everybody already got their Win95 machines and all the gadgets to go with it, i.e. goodbye dot-matrix printers, hello inkjet - now learn it.

    This human action seems to fit better as an explanation. ...But I'm just an armature Austrian, I could be wrong?

    Also, I think Business investment decelerated in 1q 2012 due to a lag of some kind, or as Robert Higgs says, uncertainty of the regime.

    Consumer spending was up in 1q 2012 because their mailboxes were suddenly flooded again with credit card offers after a bit of an absence, and I suspect credit limits were raised at that time too after a time of no change in credit limits combined with maxed out credit cards and upside down home equity loans. Hey, isn't that kind of what happened in 2004? ...And 2000? ...And 1998? Prior to all the other Fed manipulated surges in the economy.

    Just a thought.

    - clark

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  3. is this playful banter or do you guys genuinely not like each other?

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    Replies
    1. it's just a good old-fashioned bro-down.
      http://www.youtube.com/watch?v=WoudYNeVn5E

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  4. You guys Austro-beefin??

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  5. I don't like it when mommy and daddy fight...

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  6. I read Murphy's piece it is logical, and while I'm a strong believer in ABCT it looks like they were thinking outside the box on this call and were right.

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  7. What happens when my two favorite economists rumble? I get smarter!

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