Monday, May 28, 2012

Jersey Shore

Professor Krugman:
For some time now (Jersey Guv Chris) Christie has been touting what he calls the “Jersey comeback.” Even before his latest outburst, it was hard to see what he was talking about: yes, there have been some job gains in the McMansion State since Mr. Christie took office, but they have lagged gains both in the nation as a whole and in New York and Connecticut, the obvious points of comparison.

Yet Mr. Christie has been adamant that New Jersey is on the way back, and that this makes room for, you guessed it, tax cuts that would disproportionately benefit the wealthy.
Last week reality hit: David Rosen, the state’s independent, nonpartisan budget analyst, told legislators that the state faces a $1.3 billion shortfall. How did the governor respond? 

First, by attacking the messenger. According to Mr. Christie, Mr. Rosen — a veteran public servant whose office usually makes more accurate budget forecasts than the state’s governor — is “the Dr. Kevorkian of the numbers.” Civility! 

Sunday, May 27, 2012

Keynes and fiscal irresponsibility

Econospeak corrects some confusion over Keynes and long-term debt that's pushed by the "Reagan taught us deficits don't matter" BizarroWorld "Keynesianism" that rears it's head on the Right when it's "more tax cuts" time and magically disappears when the agenda morphs into "cut entitlements":

Keynes was not in favor of the type of long-term fiscal irresponsibility that we have witnessed say in the United States during the Administrations of Ronald Reagan and George W. Bush. Yes I know proponents of the 1981 and 2001 tax cuts could argue that we were not at full employment when these tax cuts were passed. However, the 1981 tax cut was not needed to get us back to full employment. Volcker’s [contractionary] monetary policy – for better or worse (worse in my view) – was the main driving factor for the U.S. economy. And we know George W. Bush pursued a host of fiscal policies that were more long-term in nature and all fiscally irresponsible. If [anyone] thinks Lord Keynes would have approved these episodes of fiscal stimulus – I submit he’s very ignorant of the brand of economics that Lord Keynes and economists like Paul Krugman strive to describe.

Friday, May 25, 2012

More Keynesian Blather From Paul Krugman...

 You can't shut Paul Krugman up:
(I)f you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%. That is by definition throwing us into recession or depression.
Oh, wait a minute.  That was Mitt Romney doing that Beltway "gaffe" thing, where blurting out the truth is seen as a "mistake," especially when it runs counter to every crank proposal Romney has endorsed that has been forthcoming from the Ryan Austerity Megaphone of the GOP - the dominant party "intelligentsia," who are either economically illiterate or WANT to plunge the country into even deeper extended depression.

Jon Chait notes: "Romney says this as if it’s completely obvious that reducing the deficit in the short term would throw the economy back into recession, even though he and his party have been arguing the opposite case with hysterical fervor. Republicans have committed themselves to Austrian economic notions and other hoary doctrines justifying the position that reducing deficits is a helpful way out of a liquidity trap"

I'm not convinced Willard M. Romney is particularly smart, but it's clear that beneath the nauseating facade of sheer cynicism there's still some small grain of common sense.  The fact that he's a practiced liar when glibly espousing the GOP far Right's agenda as his own - albeit subject to the occasional "Beltway gaffe" as in the CNN interview - appears to be the only "redeeming" feature of his candidacy, not a fatal flaw.  Which is pathetic.


Thursday, May 24, 2012

This Just In! Presidential Aspirant Can Read a Balance Sheet!

Good discussion of Romney and Bain by Martin Bashir and guests, standing in for Lawrence O'Donnell last night - special props to Joy-Ann Reid for devastating take-down of Willard's reference to Bain's Steel Dynamics start-up, which leaned heavily on tax-payer subsidies - including a tax increase - to make a large profit:


Is Greed Good? Professor Krugman Wonks Us Out With the Data

Krugman @ NYT:
From "Mitt Romney Is a Tool" - K. Genius & TBX

As the debate moves – appropriately! – to a discussion of Romney’s career at Bain, one thing I’ve noticed is that everyone on the right, and a fair number of people who should know better, basically believes that Gordon Gekko was right. Before the Gekkos came along, they assert, American business was sluggish, unproductive, and uncompetitive. Then came the LBOs and all that, and our economic energy was unleashed.
As I said, everyone on the right knows that this happened. Needless to say, none of it is at all true.

Let’s look at how trends changed after 1980 or so, when the underlying rules of American business (and politics) shifted. Start with productivity – I use a log scale, so that the slope of the trend represents the rate of growth. See the big acceleration? Neither do I – productivity growth has actually been slower since the rise of Bain-type operators.

The "Austerity Cliff" and the GOP's Military Keynesians

 Brian Beutler at TPM:

A giant austerity bomb is timed to go off at the beginning of next year, and the threat of significantly higher taxes and lower spending has Republicans running around the Capitol sounding more like John Maynard Keynes than John Boehner.

Automatic, across-the-board reductions to domestic and defense spending, combined with the looming expiration of the Bush tax cuts, will dramatically consolidate the budget in the next calendar year, if Congress does nothing. And despite bemoaning deficits throughout the Obama years, the GOP’s suddenly come around to the view that cutting government spending is a job killer.

Just listen to Sen. John Cornyn (R-TX).

“Just when you thought the economic news could not get much worse with slow economic growth, with reduced wages because of higher costs, and with many people simply giving up looking for work with the lowest labor participation rate we’ve had in some time,” Cornyn warned reporters in the Capitol Tuesday, “we have an entirely predictable and preventable jobs crisis approaching in January, where because of the sequestration [automatic spending cuts], my state alone will lose 91,000 private sector jobs — and there are about a million private sector jobs at risk if the sequestration goes into effect on January 2.

This marks the return of the Defense Keynesians — Republicans who admit that government spending supports job growth in a weak economy, if and only if that spending is directed toward the military.

As luck would have it, a new Congressional Budget Office concludes Republicans are right about the economic consequences of defense cuts — but that their other fiscal priorities are just as perilous for economic growth.

If all the fiscal tightening scheduled for the beginning of the year is allowed to take effect, it will take a huge bite out of the projected deficit for the coming fiscal year.

Unfortunately, it’ll take a similarly large bite out of GDP — enough to threaten a new recession. And the resulting job losses would reduce tax revenues and increase spending on jobless benefits enough to undo billions of dollars in direct deficit reduction.

Monday, May 21, 2012

Willard M. Romney's Debt and Deficits Hustle

Romney: "Today America faces a financial crisis of debt and 
spending that threatens what it means to be an American."

Center for American Progress: 
There’s one major problem with Romney’s rhetoric: his economic plan makes the debt worse. Romney’s tax plan gives a 20 percent across-the-board tax cut to all Americans and repeals the Alternative Minimum Tax, costing $10.7 trillion over the next decade and reducing federal revenues to just 15 percent of GDP, according to Center for American Progress Director of Tax and Budget Policy Michael Linden. Romney hasn’t offered a plan to pay for those cuts, instead simply asserting that he will balance the budget.

But balancing the budget under those terms would be next to impossible. Even if Romney limits tax deductions for the richest Americans as he says he would, he would need 6.5 percent economic growth for the next five years to keep his plan from adding to the deficit. To put that in perspective, the best five-year period of growth since World War II was from 1961 to 1966, when the economy grew at 5.8 percent per year.

"Deja Vu Debacle"

 Paul Krugman @ New York Times:

Sometimes it’s hard to explain why we need strong financial regulation — especially in an era saturated with pro-business, pro-market propaganda. So we should always be grateful when someone makes the case for regulation more compelling and easier to understand. And this week, that means offering a special shout-out to two men: Jamie Dimon and Mitt Romney...

First...let me talk about Mr. Romney, whose remarks about those troubles were so off-point that they constitute a teachable moment. 

Here’s what the presumptive Republican presidential nominee said about JPMorgan’s $2 billion loss (which may actually have been $3 billion, or $5 billion, or more, but who’s counting?): “This was a loss to shareholders and owners of JPMorgan and that’s the way America works. Some people experienced a loss in this case because of a bad decision. By the way, there was someone who made a gain.” 

What’s wrong with this statement? Well,’s not O.K. for banks to take the kinds of risks that are acceptable for individuals, because when banks take on too much risk they put the whole economy in jeopardy — unless they can count on being bailed out. And the prospect of such bailouts, of course, only strengthens the case that banks shouldn’t be allowed to run wild, since they are in effect gambling with taxpayers’ money.

Incidentally, how is it possible that Mr. Romney doesn’t understand all of this? His whole candidacy is based on the claim that his experience at extracting money from troubled businesses means that he’ll know how to run the economy — yet whenever he talks about economic policy, he comes across as completely clueless...
Jamie Dimon is no Jimmy Stewart. But he has, in a way, been playing Jimmy Stewart on TV, posing as a responsible banker who knows how to manage risk — and therefore the point man in Wall Street’s fight to block any tightening of regulations despite the immense damage deregulated banks have already inflicted on our economy. Trust us, Mr. Dimon has in effect been saying, we’ve got this covered and it won’t happen again. 
Now the truth is coming out. That multibillion-dollar loss wasn’t an isolated event; it was an accident waiting to happen. For even as Mr. Dimon was giving speeches about responsible banking, his own institution was heaping on the risk. “The unit at the center of JPMorgan’s $2 billion trading loss,” reports The Financial Times, “has built up positions totaling more than $100 billion in asset-backed securities and structured products — the complex, risky bonds at the center of the financial crisis in 2008. These holdings are in addition to those in credit derivatives which led to the losses." ...  It really is déjà vu all over again. 

Saturday, May 19, 2012

A prosperous middle class is central to economic productivity and income inequality is a threat to our economic and political health

 Heather Boushey and Adam Hersh at Center for American Progress:
To say that the middle class is important to our economy may seem noncontroversial to most Americans. After all, most of us self-identify as middle class, and members of the middle class observe every day how their work contributes to the economy, hear weekly how their spending is a leading indicator for economic prognosticators, and see every month how jobs numbers, which primarily reflect middle-class jobs, are taken as the key measure of how the economy is faring. And as growing income inequality has risen in the nation’s consciousness, the plight of the middle class has become a common topic in the press and policy circles.

For most economists, however, the concepts of “middle class” or even inequality have not had a prominent place in our thinking about how an economy grows. This, however, is beginning to change. One reason for the change is that the levels of inequality and the financial stress on the middle class have risen dramatically and have reached levels that motivate a closer investigation. The interaction and concurrence of rising inequality with the financial collapse and the Great Recession have, in particular, raised new issues about whether a weakened middle class and rising inequality should be part of our thinking about the drivers of economic growth.

Friday, May 18, 2012

"Taxing the rich to make the single shrewdest thing we can do for the middle-class, for the poor...and for the rich"

Millionaire tech investor Nick Hanauer gave a talk at Technology Entertainment and Design - which regularly posts the equivalent of video essays on it's popular site - but it was apparently kept off of the site because the presumed audience of wealthy entrepreneurs wouldn't want to hear Hanauer's message of "taxing the rich" as "the single shrewdest thing we can do." There's a lot of applause for Hanauer in the room. One wonders why TED found Hannauer's timely and insightful talk troublesome:

HT: Rob Grocholski

Wednesday, May 16, 2012

Volcker: "If you want to gamble in derivatives, surrender your banking license"

Former Treasury Secretary Paul Volcker on JP Morgan/Chase:

A battle looms over "Simpson-Bowles" - among Democrats

Simpson: "Veterans...are not helping the country in this fiscal mess."
Richard Eskow of Campaign for America's Future files this harsh, utterly depressing report from the "Deficit Summit." Unfortunately, it rings true. The 2012 election is going to take most liberal folks' eyes off of this ball, but a major fight is looming - and within Democratic circles - over the Simpson-Bowles "bi-partisan" plan to gut government programs and shift wealth even more toward the 1% than it already has.

Establishment Democrats are embracing an approach to "deficit reduction" that privileges the 1% and ignores the centrality of unemployment as the nation's #1 problem.  And they ignore the fact that worrisome long-term deficit projections are - above all else - rooted in the need to reform our health care delivery system.  Medicare has nothing to do with that problem - other than providing the most cost-effective approach to health insurance that exists currently in the US.  Medicare doesn't drive the problem of health care costs as % of GDP - it lessens them. Address the larger issue and long-term federal deficits are easily managed.

Be prepared for the looming deficit battle - because these "rich white guys" clearly are. And be prepared to draw lines in the sand against a significant cohort of establishment  Democrats and administration insiders.

Today a bunch of rich white guys held a "Fiscal Summit" and agreed that:

1. Despite the fact that unemployment is causing untold suffering for millions of people, it's not very important.

2. Despite the fact that wage stagnation is destroying the middle class, that's not important either.

3. Despite the fact that we need the social safety net more than ever after what they've done to the economy, it's expendable.

4. Despite the fact that our government can borrow money at record low rates and use it to put people to work, thereby ending the recession and jumpstarting the economy, that option's not even worth discussing.

5. Despite the fact that these men all possess great power, wealth, and/or influence, everything that's wrong with the economy is your fault.

6. Since it's all your fault, you better get ready to pay up.

Oh, and one other thing:

7. They're all very smart and very brave. It's too bad the rest of you people are such jerks.

Tuesday, May 15, 2012

"Make Banking Boring"

NYT's Joe Nocera:
Let’s begin by stipulating the obvious: nobody outside of JPMorgan Chase knows for sure what really happened with those trades that have cost it so much money and done such severe damage to its once stellar reputation. 

In his conference call last Thursday, Jamie Dimon, the bank’s chief executive, characterized the trades as “stupid,” but refused to get into any specifics. Even hedge fund managers on the other side of the JPMorgan trades have been able to cobble together only bits and pieces. Most of the emphasis has been on the credit derivative business managed by one Bruno Iksil in JPMorgan’s London office — a k a the “London whale.” Yet from what I hear, his losses probably won’t total more than $600 million — while the bank’s total losses have reached $2.3 billion, and could well hit $4 billion, according to The Wall Street Journal. Where are the rest of the losses coming from? As I say, nobody knows. 

Still, we know enough to be able to make some informed judgments. We know that JPMorgan, awash in taxpayer-insured deposits, took some of that money — around $62 billion at last count — and decided to invest it in corporate debt, which had the potential to generate higher returns than, say, old-fashioned loans...

We know that JPMorgan’s chief investment office, which had orchestrated the debt purchases, decided to hedge the entire portfolio by selling credit default swaps against a corporate bond index. You remember our old friends, credit default swaps, don’t you? Three years ago, they nearly brought down the financial world. Not content with its hedge, it then hedged against the hedge. It was all very complex, of course, and all done in the name of “risk management.”

Monday, May 14, 2012

The Tragedy of Long-Term Unemployment

Dean Baker and Kevin Hassett @ New York Times:
THE American economy is experiencing a crisis in long-term unemployment that has enormous human and economic costs.
In 2007, before the Great Recession, people who were looking for work for more than six months — the definition of long-term unemployment — accounted for just 0.8 percent of the labor force. The recession has radically changed this picture. In 2010, the long-term unemployed accounted for 4.2 percent of the work force. That figure would be 50 percent higher if we added the people who gave up looking for work.
Long-term unemployment is experienced disproportionately by the young, the old, the less educated, and African-American and Latino workers.
While older workers are less likely to be laid off than younger workers, they are about half as likely to be rehired. One result is that older workers have seen the largest proportionate increase in unemployment in this downturn. The number of unemployed people between ages 50 and 65 has more than doubled.
The prospects for the re-employment of older workers deteriorate sharply the longer they are unemployed. A worker between ages 50 and 61 who has been unemployed for 17 months has only about a 9 percent chance of finding a new job in the next three months. A worker who is 62 or older and in the same situation has only about a 6 percent chance. As unemployment increases in duration, these slim chances drop steadily.
The result is nothing short of a national emergency. Millions of workers have been disconnected from the work force, and possibly even from society. If they are not reconnected, the costs to them and to society will be grim.

Friday, May 11, 2012

Jamie Dimon's Folly

 Henry Blodgett @ Business Insider:
Yesterday's JP Morgan implosion has now put any lingering questions to rest.
Wall Street banks simply cannot be trusted to manage the massive risks they are taking.
After the financial crisis, when most of the world's banks were revealed to have been run by reckless gamblers, a couple of institutions stood above the fray.
JP Morgan was one of them.
The idiocy of a handful of gamblers should not be construed as a problem with the system as a whole, institutions like JP Morgan said.
Well-run banks should be trusted not to be so colossally reckless and stupid.
Well-run banks should be allowed to manage their own risks. Well-run banks should not be hammered with straight-jacket regulations that would stymie their marvelous and creative innovation. Well-run banks should be free to look after themselves, like responsible adults.
And the banking lobbying engine rushed this message to Washington and threw money around. And the lobby quickly persuaded Congress that Wall Street was fine, that the financial crisis was an aberration, that Wall Street should be left alone.

JP Morgan was the prime engine of this message. And its brilliant CEO, Jamie Dimon, was Wall Street's defiant Adult-In-Chief. 
Dimon had credibility, because unlike all the other incompetent banks, his bank hadn't imploded and brought the system to the edge of catastrophe...
But now JP Morgan has blown up.
So we finally know the truth about Wall Street, a truth most Wall Street observers have known all along:
Wall Street can't be trusted to manage—or even correctly assess—its own risks.

"Easy Useless Economics"

Currently reading Professor Krugman's "End This Depression Now!", from which he's essentially lifted today's column in the NYTs.  A Must Read!  Krugman's also been batting down - without mentioning names - some of the nonsense that's being peddled by his "colleague" David Brooks about structural problems trumping any effective solutions to the current crisis.

Money quote today is Krugman quoting Keynes - "Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is long past the sea is flat again":
A few days ago, I read an authoritative-sounding paper in The American Economic Review, one of the leading journals in the field, arguing at length that the nation’s high unemployment rate had deep structural roots and wasn’t amenable to any quick solution. The author’s diagnosis was that the U.S. economy just wasn’t flexible enough to cope with rapid technological change. The paper was especially critical of programs like unemployment insurance, which it argued actually hurt workers because they reduced the incentive to adjust. 

O.K., there’s something I didn’t tell you: The paper in question was published in June 1939. Just a few months later, World War II broke out, and the United States — though not yet at war itself — began a large military buildup, finally providing fiscal stimulus on a scale commensurate with the depth of the slump. And, in the two years after that article about the impossibility of rapid job creation was published, U.S. nonfarm employment rose 20 percent — the equivalent of creating 26 million jobs today. 

So now we’re in another depression, not as bad as the last one, but bad enough. And, once again, authoritative-sounding figures insist that our problems are “structural,” that they can’t be fixed quickly. We must focus on the long run, such people say, believing that they are being responsible. But the reality is that they’re being deeply irresponsible. 

Wednesday, May 9, 2012

The Real Deficit Story

It can't be repeated enough - Dave Johnson @ Campaign for America's Future:
Atrios says it: Eschaton: Planning For 10 Years From Now
"Listen, government has got plenty of money."
The last time the an administration did the supposedly responsible thing, the fiscal "hawks" suddenly decided that the worst possible thing was no longer a deficit, but a surplus, and that therefore it was necessary to have massive tax cuts for rich people.
And they will, of course, do it again.
Any time any DC elite complains about "the deficit" remind them that when Clinton left office we had a huge surplus, so big that at the rate it was being paid down the entire US debt was going to be paid off in 10 years. Bush demanded that we give back the people's money and Greenspan warned of the danger of paying off the debt. Etc. Etc. Etc. Then Bush doubled military spending -- and started two wars on top of that!

So we went from big surplus to huge, huge deficits. Bush said it was "incredibly positive news" when we went back into deficit spending. He said it was good news because it continued the plan to use debt to force the government to cut back. He said that. It was the plan. (Don't take my word for it, click the links.)

The Reagan people said it too, back when they started the massive deficit spending. It was the plan: force the country into massive debt, "starve the beast," and use that to force the government out of business, or at least to be "small enough to drown in a bathtub." They forced the tax cuts and Reagan said this was "cutting the government's allowance." The point was to use revenue cutbacks to force government to shrink, to get out of the way of the 1%.
Now that government is very much out of the way of the 1% we are seeing how things work out when the 1% dominate everything.

They called it "strategic deficits." They said it was the plan to force the country into debt, and then they would demand that we cut the things that government does for the 99%, in order to further enrich the 1%. They would scare everyone by saying that the debt will destroy us so we have to cut back. That was the plan. They said that was the plan. And now that the plan is being executed, we should understand that it was the plan and not fall for it!

They said it was the plan. So as the plan unfolds, don't be so surprised.

Tuesday, May 8, 2012

The Job Creators

The BGOV Barometer shows that since Democrat John F. Kennedy took office in January 1961, non-government payrolls in the U.S. swelled by almost 42 million jobs under Democrats, compared with 24 million for Republican presidents, according to Labor Department figures.
Democrats hold the edge though they occupied the Oval Office for 23 years since Kennedy’s inauguration, compared with 28 for the Republicans. Through April, Democratic presidents accounted for an average of 150,000 additional private-sector paychecks per month over that period, more than double the 71,000 average for Republicans

Monday, May 7, 2012

"Learned Helplessness" in Hard Times

Economist Robin Wells @ The Guardian:
Yet another disappointing statistic today from the US labor market – only 115,000 jobs added in April, barely enough to keep the unemployment rate from rising given the growth in population, and a significant fall from the 154,000 jobs added in March. While not necessarily a sign that the economy is headed for another turn downward, April's job numbers signal a repeat of the pattern seen in 2011 – a recovery that is halting, unpredictable, and agonizingly slow...

And it's not surprising given the continued heavy drag on the economy from high levels of household debt, high oil prices, and significant budget cutbacks by state and local governments. Moreover, the longer the economy limps along, the harder it appears to be for policymakers to accept that another outcome is possible. Months with stronger numbers will be seen as confirmation that the economy is turning the corner, and months with weaker numbers will be seen as confirmation that there's little one can do in the face of the need for longterm adjustments in the economy. Learned helplessness sets in.

One could not have asked for a clearer example of learned helplessness than Ben Bernanke's recent press conference, where he labeled calls for further Fed stimulus "reckless" and appeals for a higher inflation target "irresponsible" because it would, in his view, sacrifice its commitment to a 2% inflation target. Higher inflation helps stimulate a depressed economy as consumers and businesses find it less appealing to sit on cash, and it reduces the real cost of pre-existing debt. Ironic given that a 4% inflation rate during the Reagan years was considered perfectly acceptable...

Friday, May 4, 2012

How to End This Depression

Paul Krugman says "it's easy":
The depression we’re in is essentially gratuitous: we don’t need to be suffering so much pain and destroying so many lives. We could end it both more easily and more quickly than anyone imagines — anyone, that is, except those who have actually studied the economics of depressed economies and the historical evidence on how policies work in such economies.

The truth is that recovery would be almost ridiculously easy to achieve: all we need is to reverse the austerity policies of the past couple of years and temporarily boost spending. Never mind all the talk of how we have a long-run problem that can’t have a short-run solution—this may sound sophisticated, but it isn’t. With a boost in spending, we could be back to more or less full employment faster than anyone imagines.

But don’t we have to worry about long-run budget deficits? Keynes wrote that “the boom, not the slump, is the time for austerity.” Now, as I argue in my forthcoming book—and show later in the data discussed in this article—is the time for the government to spend more until the private sector is ready to carry the economy forward again. At that point, the US would be in a far better position to deal with deficits, entitlements, and the costs of financing them.
Meanwhile, the strong measures that would all go a long way toward lifting us out of this depression should include, among other policies, increased federal aid to state and local governments, which would restore the jobs of many public employees; a more aggressive approach by the Federal Reserve to quantitative easing (that is, purchasing bonds in an attempt to reduce long-term interest rates); and less timid efforts by the Obama administration to reduce homeowner debt...
The politics of achieving that?  Okay, that's more difficult. Krugman discusses the evidence for his argument and the obstacles to achieving rational policy to end what he forthrightly calls "this depression" at length in his current New York Review of Books article, HERE.

Wednesday, May 2, 2012

"Rebellion at the Fed"

Matthew O'Brien at The Atlantic:
Chicago Federal Reserve president Charles Evans doesn't look the part of a heretic. But in the cozy, conservative club that is central banking, he certainly qualifies. While most of his colleagues at the Fed have recently taken an even more hawkish turn, Evans remains a champion of additional monetary stimulus. And on Tuesday he took an even bigger step: He became the first sitting Fed member to endorse nominal GDP (NGDPlevel targeting... 
 The Fed famously has a dual mandate: It's supposed to promote the maximum level of employment consistent with its two-percent inflation target. In reality, this dual mandate often looks more like a single inflation mandate. NGDP level targeting would do away with this problem by rolling the mandates together. And right now, that would mean a much more aggressive Federal Reserve... 
In the end, this is really a clash over inflation. After all, we're talking about central bankers here. The first group is worried that by effectively printing more money to goose the economy (better known to in policy circles as "quantitative easing"), the Fed has already created future inflation. The second group isn't worried about the money that's already been printed, but believes that running the presses any further will create future inflation. Finally, a third group is worried that if the Fed doesn't print more money, there won't be enough inflation to keep the economy healthy. Evans belongs to the last camp.