Thread by @delong

braddelong.substack.com/p/podcast-hexa…

Noah Smith & Brad DeLong's 30:00 < [Length of Weekly Podcast] < 60:00. This is our most... discursive & rambling episode; be warned!

Key Insights:

* Hexapodia!

* To mix metaphors, when we go hunting for zombie economic ideas, there are lots of... 1/

...fish in barrels for us to shoot. We do not have to try to shoot them all. Indeed, we should not.

* We should, instead, listen to Markus Brunnermeier at 12:30/09:30 EDT/PDT every Thursday at <bcf.princeton.edu/markus-academy/>

* Josef Schumpeter’s “depressions are… forms of... 2/

...something which has to be done, namely, adjustment to previous economic change. Most of what would be effective in remedying a depression would be equally effective in preventing this adjustment…” is perhaps the most zombie of zombie economic ideas.

* Schumpeter’s... 3/

... zombie leads to episodes of dorkish zombie economic derp like John Cochrane’s claim in November 2008 that we needed a recession because we were then—in November 2008—building too many houses and employing too many people in construction:

* Another destructive zombie... 4/

...idea is the idea that the Phillips Curve and adaptive expectations guarantee that you only need to worry about inflation—the unemployment will take care of itself, and that if policy errs and pushes unemployment up too high above the natural this year, you will get it... 5/

...back because unemployment will then necessarily be an equal amount below the natural rate in some future year—as long as inflation is stabilized.

* The PCAE zombie leads to episodes like today, when a surprisingly large number of people who should know better are... 6/

... worrying not about unemployment but only about inflation 7/END