The news

sigh

Watching ABC World News. The big story tonight: "surging" home prices!

So is it time to sell your house!!??! Diane asks her colleague, beaming.

The colleague speaks with authority. If your house has regained its value, then yes. Time to sell.

I despair.

The increase year-over-year is 5.5%. Given that house prices dropped at least 27% from peak (was it closer to 33%?) and then flatlined for 6 years, a 5.5% gain cannot properly be called a "surge," and it doesn't put anybody back where they were. (With the possible exceptions of Denver, Dallas, Charlotte, and maybe Cleveland, if I'm reading the chart right.)

If you're Diane Sawyer and you're determined to call a 5.5% gain after 6 years a "surge," then you need to include the 6-year figure for context, along with the 27% figure. Also for context.

Why is this not happening?

Why am I hearing "surging home prices"?

Can our national news programs not hire someone who can read a graph?

Meanwhile Debbie S tells me everyone says "housing is back" except two people: me, and her realtor.

I remember Diane, a couple of years ago, joyously announcing jobs were back. That wasn't true, either.

Housing’s Rise and Fall in 20 Cities Last updated 9/25/2012
Case-Shiller: House Prices increased 5.5% year-over-year in November
December Employment Report: 155,000 Jobs, 7.8% Unemployment Rate

buy this book!

For a year and a half now, I have been sending people who ask me whether I think the economy is "getting better" to Marcus Nunes' What does a downloaded economy look like?

Now Marcus and Benjamin Cole have written the first book on "market monetarism." I've read it, I've highlighted it, and I've blurbed it --- it's terrific!

Market Monetarism: Roadmap to Economic Prosperity

Wisconsin introduces competency exams!

From College Degree, No Class Time Required:

David Lando plans to start working toward a diploma from the University of Wisconsin this fall, but he doesn't intend to set foot on campus or even take a single online course offered by the school's well-regarded faculty.

Instead, he will sit through hours of testing at his home computer in Milwaukee under a new program that promises to award a bachelor's degree based on knowledge—not just class time or credits.

"I have all kinds of credits all over God's green earth, but I'm using this to finish it all off," said the 41-year-old computer consultant, who has an associate degree in information technology but never finished his bachelor's in psychology.

Colleges and universities are rushing to offer free online classes known as "massive open online courses," or MOOCs. But so far, no one has figured out a way to stitch these classes together into a bachelor's degree.

Now, educators in Wisconsin are offering a possible solution by decoupling the learning part of education from student assessment and degree-granting.

Wisconsin officials tout the UW Flexible Option as the first to offer multiple, competency-based bachelor's degrees from a public university system.

By CAROLINE PORTER
January 24, 2013, 6:32 p.m. ET
Wall Street Journal

Wow.

I'm thinking....all those disruptive technology people may turn out to be right for the wrong reason.

The coming Disruption won't be courses going online.

The coming Disruption will be courses going away altogether. (Some of them, anyway.)

The tests go online, not the courses.

I don't believe in making predictions, but even so I have simply never been able to see how MOOCs save the day. I can't stand online courses myself, my students don't like them, and I don't know any grownups who like them, either. The people touting them (and investing in them) don't seem to have taken any coursework via MOOCs themselves, as far as I can tell.

So while the logic of the MOOC -- put the best professors online so thousands can learn! -- often seems unassailable, I just don't see it. Put it this way: I don't believe in making predictions, and I continue to wonder what I'm missing, but I will not be investing my pennies in Udacity, Coursera, or edX.

I have always thought, though, that there is a major use for the internet when it comes to assessment.

Maybe college competency exams are the missing piece?

Such a scenario -- MOOCs fail as a means of making college affordable, but competency exams succeed -- strikes me as possible.

First, according to the Bain/Sterling Partners report, one-third of U.S. colleges and universities are in financial trouble.

Second, the economy continues to be depressed and, absent "regime change" at the Federal Reserve,  will remain depressed.^*

Given a depressed economy, I assume some colleges will close.

College closings will put pressure on state universities to expand, but state colleges are also in financial stress and have been raising tuition. They are in no position to grow.

At some point, it seems to me, political pressure will build on state legislatures to find another way to provide college diplomas.

In short, I can imagine Wisconsin's move attracting a lot of imitators, and sooner rather than later. I can also imagine a circular effect, with college closings leading to the introduction of competency exams,  and the introduction of competency exams then leading to more college closings.

That's disruption.

We'll see.

If competency exams begin to take hold, I can imagine a number of other developments that might be very interesting.

^* The economy is growing but is not going back to trend as it always has done in the past, including the Great Depression. I know people hold out hope that a housing recovery will lead to a real recovery, but since I am persuaded by Scott Sumner's analysis, I don't see housing as the white horse.

chart from: historinhas
and see:
Lawyers without Law School
proposal for a national baccalaureate
why college costs so much
US News: 2-year law degrees

Scott Sumner on the cliff

According to Sumner, the numbers are different from what we read in the papers.

major news from the Fed

Scott Sumner on the Bernanke press conference:

1. Bernanke emphasized that monetary stimulus is not like fiscal stimulus, it actually reduces the budget deficit. That’s right.

2. He said it was an 11 to 1 vote. The Fed is clearly behind him and hence the policy has credibility.

3. He kept talking jobs jobs jobs. And he emphasized that the Fed would do pretty much whatever it takes to get some progress on the employment front. Of course by itself that would be a bad policy. But when combined with the 2% inflation target (which he said had equal weight) it’s getting pretty close to NGDP targeting.

4. Speaking of NGDP targeting, Bernanke brought up the idea (without any prompting by reporters) and talked about Woodford’s plan for NGDP level targeting. He didn’t endorse it (how could he when the Fed only recently adopted a 2% inflation goal) but he certainly wasn’t critical of Woodford. I had the impression that if he wasn’t constrained by being head of the Fed right now, he’d be pretty sympathetic to Woodford’s proposal. And why do I have to call it “Woodford’s proposal?”

5. I’ve gotten a lot of criticism from people, even my friends in the blogosphere, for going too easy on Bernanke. Talking about how he’s well-intentioned, etc. I think this press conference shows that my comments were justified. A commenter named Mark C recently sent me a survey by Bloomberg that showed that the vast majority of economists did not think money was too tight, and only 1 out of 66 thought money was far too tight. Even though Bernanke is a Republican, he’s to the left of the mainstream of a profession that votes 70% Democratic. His call for doing whatever it takes to get more jobs was clearly sincere.

Thank God the Bernanke/Woodford policy has failed!
One down, two to go
I think Ben just did it
Is the Fed Really Causing the Sustained Drop in Interest Rates?
Federal Reserve Finally Working Expectations Channel with Open-Ended QE
Build That Apartment Building Now

The Great Recession: Market Failure or Monetary Disorder? by Robert Hetzel
Money Mischief: Episodes in Monetary History by Milton Friedman

Bernanke press conference

update:
Michael Woodford reacts
David Beckworth: Money Still Matters (Fed measure is wrong) - growth in Germany's M4 Divisia money supply compared to M4 Divisia growth in Eurozone & US

PRESS CONFERENCE: BEN BERNANKE DEFENDS UNLIMITED QE, AS MARKET GOES TOTALLY WILD by Joe Weisenthal and Matthew Boesler
Ben Bernanke Put On An Ingenious Performance Today — Here's What Just Happened by Joe Weisenthal

Rortybomb: Monetary Policy Explained with Animated gifs

off-topic: Michael Woodford endorses NGDP-targeting today at Jackson Hole

Sorry -- again -- to be so absent. I went straight from empty-nest trauma (hate the empty nest!) to a 5-day "precision teaching practicum" Erica M helped put together...and the days have gone by.

Looking forward to getting back to ktm, but before I do, I'm posting news from my other preoccupation in life: NGDP level targeting.

Until now, the campaign for NGDP level targeting has been mostly a David-and-Goliath affair. But with Michael Woodford's endorsement of NGDP-targeting today at Jackson Hole, that may have changed.

Bloomberg has also endorsed.


The merry band (alphabetical order):
David Beckworth
Lars Christensen
David Glasner
Joshua Hendrickson
Marcus Nunes: Historinhas
Evan Soltas
Bill Woolsey
Matthew Yglesias: Michael Woodford Makes The Case For NGDP Targeting

Academic Sways Central Bankers
Market Watch: Columbia University’s Woodford is key presenter at Jackson Hole

The Great Recession: Market Failure or Monetary Policy Disorder? by Robert L. Hetzel 

Independent George reflects

re: sticky wages at the Louisiana State Penitentiary, Independent George writes:

You know you've been fully immersed into the canine world when the first thing you think about when reading an econ article on a math blog is how they've gotten the dogs wrong.

I cracked up when I read that.

Since I, too, find dogs majorly fascinating, I'm posting Independent George's second Comment:

The other red flag from your quoted passage is "120 pounds". Wolves don't naturally grow anywhere close to that size, which makes me question how much wolf is actually in those supposed hybrids.

I will say, though, that wolves ARE scary; when you see those yellow eyes staring at you in the yard, I completely understand how that would deter a prisoner escape. True wolfdogs behave very differently from dogs, and we're genetically hardwired to spot the difference. The very thing which causes the intimidation is also what makes them so unruly. And the lesson from the Belyaev experiments is that you can't have both - the behavioral traits are tied too strongly to the physical appearance.

I first grasped the "genetically hardwired" understanding between people and dogs when Christopher was age 7.

Unfortunately, Safari ate my post, so I will have to reconstruct it later.

sticky wages redux

off-topic:

Having become something of a sticky wage aficionado, I was amused to see this story, which may be the ultimate sticky-wage scenario:

Wolf, a 120-pound canine cross between a wolf and a malamute, paced his pen, staring out with amber eyes. In a few hours, his work shift would begin.

He's part of a squad of wolf dog hybrids working nights at the Louisiana State Penitentiary, a local answer to the kinds of budgetary strains felt at many of the nation's prisons.

Nobody yet has tried to overpower or outrun them. Lou Cruz, 55 years old, who's serving life for a murder he committed in Jefferson Parish near Gretna in 1981, said inmates are keenly aware of the four-legged security force prowling the perimeter.

"You might run," he said, "but they're going to catch you."

The wolf dogs, as they are called here, are the brainchild of Warden Burl Cain and his staff, and they were brought in last year in response to a steady decline in the prison's annual budget from $135 million five years ago to $115 million today. The prison, which is known as Angola, has laid off 105 out of 1,200 officers, and 35 of the 42 guard towers now stand empty on the 18,000-acre prison grounds.

The animals regularly guard at least three of the seven camps that make up the complex.

Mr. Cain says the wolf dogs are a strong psychological deterrent. "The wolf ate Grandma," he said.

They also save money. The average correctional officer at Angola earns about $34,000 a year, a prison spokesman said. By comparison, the canine program, which includes about 80 dogs—the wolf hybrids along with other breeds for other tasks— costs about $60,000 annually for medical care, supplies and food.
Prison's Guards Are Part Wolf, All Business By GARY FIELDS

So we have wolf dogs earning $750 a year working side by side with humans earning $34K.^* And the warden is collecting his retirement salary along with his regular salary.

Having Googled a bit, I haven't found reports indicating that the prison cut wages or imposed furloughs before laying off people and hiring dogs. But even if they did, sticky wages are in play.

Assuming total compensation is $50K per officer, the prison could hire back all 105 employees if they reduced compensation of the 1095 remaining employees by $4,375. (Somebody check my math, please!)

That never happens.

^* I don't know whether $34K includes benefits.

Not your father's bell curve

not your father's bell curve

Sticky wages in 2011:

The tall bar in the middle represents workers who had a wage increase of $0
People to the right of the bar had pay raises
People to the left of the bar had pay cuts
Why Has Wage Growth Stayed Strong?
By Mary Daly, Bart Hobijn, and Brian Lucking

I've been meaning to post this for a while now.

I find this chart fascinating. I have never, not once in my entire lifetime, seen a curve that looked like this -- although they must be out there.

Here's the San Francisco Fed write-up:

Researchers generally point to asymmetries in the distribution of observed wage changes among individual workers as evidence of nominal wage rigidities. Figure 2 plots an example of this type of wage change distribution in 2011. The dashed black line shows a symmetric normal distribution. The blue bars plot the actual distribution of nominal wages.

The figure’s most striking feature is the blue bar that spikes at zero, indicating the large number of workers who report no change in wages over a year. This spike stands out in the distribution of actual wage changes, suggesting that, rather than cutting pay [in line with reduced earnings], employers simply kept wages fixed over the year. This is supported by the large gap to the left of zero between the actual distribution of wage changes and the dashed black line representing the normal distribution. This gap suggests that the spike at zero is made up mostly of workers whose wages otherwise would have been cut.

Once you start thinking about sticky wages, you see them everywhere.

For instance, Ed and I were watching an episode of Friday Night Lights a couple of weekends back, and the story line, which spanned multiple episodes, revolved around budget cuts to the schools. First the cuts were rumored, then the cuts were announced, and then there was rending of clothes and tearing of hair and parents mobbing board meetings to demand that cuts happen to other people's programs, not theirs. (And, yes, this sequence of events does sound familiar).

It was high drama.

Teachers would be FIRED!

Football teams would be MERGED!

Fire and flood, death and despair!

Two years ago, right up to the moment I found out about  downward nominal wage rigidities over the business cycle, ^* this story line would have made perfect sense to me. Like everyone else on the planet (including pick-up farm workers and their employers in India, apparently), I simply took it as a given that people can be cut but wages can't. In hard times, fear and loss (and television drama) follow directly from this belief.

But once you know about the money illusion, a school budget crisis loses most of its oomph as dramatic premise. Watching the pandemonium onscreen, I was unmoved. I kept thinking, "How about a wage freeze? How about a furlough? How about a wage cut?"

"How about everyone sit down and do some arithmetic and, while you're at it, figure out that it's not like the Dillon School District is a family where the sole breadwinner just lost their^** job. You've still got money coming in, you just don't have as much money coming in next year as you did this year. (Or, if Dillon is anything like Westchester County, you don't have as big an increase coming in next year as you did this year, but you've still got an increase.) So everyone's gonna have to make do with less, but nobody's gonna starve, not unless you insist on firing the young teachers so the old teachers don't have to take a cut."

No dice.

The story arc ends with teachers getting fired and football teams getting merged, and nobody says 'boo' about the possibility of 'shared sacrifice' and the like.

I realize that, in real life, employees do take freezes and furloughs to keep everyone on the job. But they don't do it often, as the chart reveals.

^* I have now consumed so much macroeconomics that I can read formulations like downward nominal wage rigidities over the business cycle almost as fast as I can read twinkle, twinkle, little star.
^**It pains me to write "the sole breadwinner just lost their job," as opposed to "the sole breadwinner just lost his job," but I think the time has come.

Clear as mud

I was just reading one of my favorite "market monetarists," (pdf file) Jose Marcus Nunes, who writes Historinhas. Apparently, the Fed is at last making its move to increase transparency.

The results - charts (pdf file) illustrating such arcana as the appropriate timing of policy firming and the appropriate pacing of policy firming - brought to mind my all-time favorite edu-chart: the strands.

Goldilocks and the money illusion

the money illusion:

The findings in this paper suggest that money illusion is real in the sense that the level of reward-related brain activity in the vmPFC [ventromedial prefrontal cortex] in response to monetary prizes increases with nominal changes that have no consequence for subjects' real purchasing power.
The medial prefrontal cortex exhibits money illusion Bernd Webera, Antonio Rangelb, Matthias Wibralc and Armin Falk - PNAS March 31, 2009 vol. 106 no. 13 5025–5028

In the car just now, Ed and I were talking about the money illusion. Ed pointed out that no one thinks when you've just been given a 3% raise in an environment of 4% inflation, your pay has actually been cut. (I know ktm people would have no problem figuring this out--! But ktm people are not the norm.)

I'm wondering whether good math education and/or the distribution of inflation calculators to one and all would affect the money illusion. I have no idea. Certain cognitive biases, loss aversion,^* for instance, are apparently built-in, but -- the money illusion? Is there something built-in about the money illusion per se?

No time to think it through just now; for the moment I'm going to guess that the money illusion is a specific manifestation of something more fundamental. Which probably means good education and universal inflation calculators would help.

That said, we are stuck with the money illusion, at least for now.

So what does this mean?

I think it means that we need a certain level of inflation for the economy to work. Deflation is bad --  everyone seems to understand that -- but zero inflation is also bad. Inflation is like the porridge in Goldilocks and The Three Bears; it can be too hot, it can be too cold, or it can be just right.

What is just right?

Having spent as much time as I have reading the market monetarists (pdf file), I assume that just right means 2% inflation along with 3% real growth.^*

But of course I don't know.

from the EurkAlert release:

"We had now confronted our test subjects with two different situations", Falk explains. "In the first, they could only earn a relatively small amount of money, but the items in the catalogue were also comparatively cheap. In the second scenario, the wage was 50 per cent higher, but now all the items were 50 per cent more expensive. Thus, in both scenarios the participants could afford exactly the same goods with the money they had earned – the true purchasing power had remained exactly the same." The test subjects were perfectly aware of this, too – not only did they know both catalogues, but they had been explicitly informed at the start that the true value of the money they earned would always remain the same.

Despite this, an astonishing manifestation emerged: "In the low-wage scenario there was one particular area of the brain which was always significantly less active than in the high-wage scenario", declares Bernd Weber, focusing on the main result. "In this case, it was the so-called ventro-medial prefrontal cortex - the area which produces the sense of quasi elation associated with pleasurable experiences". Hence, on the one hand, the study confirmed that this money illusion really exists, and on the other, it revealed the cerebro-physiological processes involved.

and more from the paper:

We used fMRI to investigate whether the brain's reward circuitry exhibits money illusion. Subjects received prizes in 2 different experimental conditions that were identical in real economic terms, but differed in nominal terms. Thus, in the absence of money illusion there should be no differences in activation in reward-related brain areas. In contrast, we found that areas of the ventromedial prefrontal cortex (vmPFC), which have been previously associated with the processing of anticipatory and experienced rewards, and the valuation of goods, exhibited money illusion. We also found that the amount of money illusion exhibited by the vmPFC was correlated with the amount of money illusion exhibited in the evaluation of economic transactions.

[snip]

Intuitively, money illusion implies that an increase in income is valued positively, even when prices go up by the same amount, leaving real purchasing power unchanged (1). In this sense money illusion has been interpreted “as a bias in the assessment of the real value of economic transactions, induced by a nominal evaluation” (2). Economists have traditionally been skeptical about the notion of money illusion (3), but recent behavioral evidence has challenged this view (2, 4–6). For example, when asked to rate the happiness of 2 otherwise identical persons who received either a 2% wage increase without inflation or a 5% wage increase with 4% inflation, the majority of subjects attribute happiness on the basis of greater nominal raises, despite lower real raises (2).

[snip]

Our main hypothesis was that areas of the brain that are engaged in the experiencing of rewards (7–9), such as the ventromedial prefrontal cortex (vmPFC), would exhibit money illusion in the sense of exhibiting a stronger BOLD response for incomes that were higher in nominal terms, but had an identical real value. Activity in these brain regions has been shown to be modulated by the receipt of both primary rewards such as food delivery (10) and more abstract forms of rewards like monetary incentives (9, 11, 12). Recent neuroimaging studies have also shown that the vmPFC is involved in the valuation of goods at the time of decision making (13–15).

[snip]

The importance of this finding derives from the fact that the answer to many classic economic problems depends on whether money illusion exists. For example, money illusion has been put forward as an explanation for the nonneutrality of money, which implies that central banks can affect production, investment, and consumption through changes in monetary policy that have an impact on the inflation rate. Likewise it offers an explanation for the important phenomenon that wages and prices are often downwardly rigid, a leading explanation for involuntary unemployment (17, 18). It is also a potential cause of bubbles in important markets, such as the housing market (19), and of deviations of stock prices from their fundamental values (20, 21). At the firm level, money illusion is important to determine optimal wage policies, which depend much on whether workers care about nominal or real wages (22). Finally, the existence of money illusion is important for the understanding of the relation between income, inflation, and subjective well-being (23). Importantly, even small amounts of money illusion can have substantial effects....

^* And even loss aversion has "boundaries". (pdf file)

^* Because I'm married to a historian, I also assume that "just right" for our time would be not right for another time quite possibly.

off-topic (somewhat): Scott Sumner on targeting NGDP

Sumner: Nominal GDP Targeting Can Save the Recovery (video interview with Kelly Evans of the Wall Street Journal)

I can't remember when I first became convinced that the Federal Reserve should stop targeting the CPI PCE and start targeting NGDP (the sum of all current dollar spending in the US).

Maybe a year ago?

I bring it up today because the idea has abruptly broken through to the mainstream, and because the state of the economy will determine whether our kids have decent jobs after college (or any job at all), not to mention whether parents will have the money to pay for college in the first place. So now's the time.

I think about NGDP-targeting this way:

1.
The Federal Reserve has a dual mandate: price stability and full employment. It is required to pursue both.

Since the crash, we have had unusually low core inflation, lower than average inflation during the Great Moderation, which was 2%. Update 1/10/2012: PCE inflation has averaged 1.37% over the four years 2007-2012.

We have also had a catastrophic collapse in employment, which is not becoming any less catastrophic as the years go by:

This chart shows the percent of the civilian population that is employed. Before the crash more than 63% of the civilian population was employed; since the crash we have bounced between 58 and 59%.

2.
The chart above is, literally, an image of a depression. In it we see employment drop off a cliff, hit bottom (let's hope), and stay there. The chart makes it impossible for me to call the situation we are in a "recovery," a "weak recovery," a "faltering recovery," an "anemic recovery," a "limping recovery," a "recovery experiencing strong headwinds," or any other formulation that includes the word recovery. This is not a recovery. In my book, this is a depression: a minor depression, but a depression nonetheless. It's not getting better, and I don't believe that more 20-year olds acquiring STEM degrees will fix things.

More STEM degrees may or may not be a good idea; better K-16 education (I've expanded my horizons) unquestionably is a good idea.

Neither one is going to fix the chart.

3.
Why is that?

Since I'm not an economist, I have to choose which expert(s) to believe. And, after spending probably a year of my life reading the various explanations of the crash, I'm persuaded by Scott Sumner and the market monetarists, (pdf file) which is not to say anyone else has to be persuaded, obviously. I'm writing an amateur economics post on an education blog just to let you know about market monetarism if you don't already.

I'm convinced the market monetarists are right, and I want our federal overlords policy elites to stop targeting inflation, and start targeting NGDP, as market monetarists recommend.

4.
Wages are sticky -- sticky meaning wages can go up, but not down. (Wages are sticky in one direction.)

I live in a state, New York, where public sector wages are beyond sticky; here in New York, public sector raises are sticky. I'm tuned in to public sector compensation because I've been dealing with my district's budget crisis for a few years now, but wages are sticky across the board in every sector, public and private.

Sticky wages kill jobs. Period. Sticky wages kill jobs because when profits decline, some employees have to be laid off so other employees can maintain their current salaries. In theory, when profits (or tax revenues) fall, wages could fall, too, and everyone would still have a job. Companies would bring in less money in sales, so they would pay less money in compensation, problem solved.

In reality, when profits (or tax revenues) decline, wages stay put. So people have to be laid off.

I have had a front-row seat watching this process unfold here in my town. Where sticky wages are concerned, I don't need experts to explain the world to me. Sticky wages are real, I've seen them, they take away jobs.

Update 1/10/2012: human employees replaced by wolves....

5.
Which brings me to the Fed.

The Bernanke Fed strongly opposes deflation and will do whatever it takes to prevent it.

The Bernanke Fed also strongly opposes inflation (the cure for deflation), and appears to think that if low inflation is good, lower inflation is better. It's fine to go to 1.5% "core" inflation (CPI minus food and energy). It's fine to go to 1%. Two percent is a ceiling, not a target. Update 1/102012: The new 'ceiling' appears to be 2.5%.

At some point (where?) inflation is bad because it might turn into deflation.

Also, if you go into recession for 18 months, and "lose" all the inflation you would have had during that period, the Bernanke Fed thinks that's fine.

There is no such thing as an inflation shortfall in the Bernanke Fed, it seems.

6.
Real estate.

Housing prices, overall, are at 1990 levels.

1990.

The Bernanke Fed is a deflation fighter, and yet the Bernanke Fed has presided over a 25% deflation in house prices in just 3 years time.

7.
Given what we've been through, I conclude that neither real estate nor jobs are coming back as long as the Fed continues to target inflation. If the Fed is targeting 2% (or 1%) inflation, and we need 33% inflation (roughly) just to get back to where we were, then we're looking at the new normal. Since I personally see no way jobs can be decoupled from prices, that means jobs don't come back, either. Not for years and years and years.

Update 1/10/2012: Hamilton Jobs Gap Calculator

So I'd like the Fed to stop targeting inflation and start targeting nominal GDP, which includes inflation but is not limited to inflation. The beauty of NGDP is that it combines inflation and employment in one number. Double mandate, single target.

I'll post links to the market monetarist blogs and the various endorsements and counter-endorsements later on. In the meantime, Scott Sumner began his blog, The Money Illusion, in 2009. Within the past month Goldman Sachs published a report endorsing the idea, and Cristina Romer wrote a column agreeing. Brad DeLong and and Paul Krugman have both endorsed; at National Review, Ramesh Ponnoru was an early adopter and advocate.

Update 1/10/2012: Worthwhile Canadian Initiative has the easiest-to-understand explanation of why inflation targeting has failed -- and why "level" NGDP-targeting would succeed -- that I've seen so far.

^* I've just this moment Googled a line from Brad DeLong saying 1% is the new 2%.