28th June 2012
This week's Bagehot columm chronicles an event that it says no British political party wants even though it's likely to happen: a "Brixit" from the European Union. FT Alphaville
Justin Fox agues that the findings of a paper by two academics called "The illusion of predictability: How regression statistics mislead experts," is proof that economists are far more confident in their predictions about the world than they have any right to be. Harvard Business Review
The fact that the Fed's announcement of "Operation Twist" had virtually no impact on either interest rates or equity prices means the next policy moves to help the economy must come from the US Congress and the White House, writes Martin Fieldstein. Project Syndicate
Eamonn Butler says one way to make sure banks like Barclays don't manipulate the inter-bank 'Libor' rate (the rate at which banks lend to each other) like they did at the height of the financial crisis in 2009, is to increase bank competition. Adam Smith Institute
Using examples from the past, Richard J. Carroll finds "that if the context is right and the tax cut is appropriately designed (Kennedy-Johnson), it will yield goods results. If the context is right, but the tax cut isn't well-calibrated (Reagan), the results will be mixed. If the economic context and the design aren't right (Bush), a tax cut can be disastrous." Bloomberg View
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