The macroeconomics of double pole dancing

August 10th, 2011

If you’re like me you’ll only understand a third of this Nick Rowe post, and grasp the rest somewhat dimly. But it’s still required reading for (even amateur) money wonks, if nothing else for the video at the end.

Worthwhile Canadian Initiative: The macroeconomics of double pole dancing.

  1. August 10th, 2011 at 16:04 | #1

    It was farther over my head than it was over yours. I did enjoy the video, but this must be said, and excuse me for shouting: THE ECONOMY IS NOT PHYSICS!

    Thank you,

  2. August 11th, 2011 at 08:14 | #2

    Yes, the video is entertaining, but is its use to suggest there is an isomorphism of the equations describing its behavior and the pole-on-pole dancing? Then the saddle is the palm, and it is moving horizontally to set the nominal rate? So now we need a three dimensional graph? Or we have (real i) = y, (nominal i) = x, and (real GDP) = z, which is scaled and runs parallel to y? But then a change in real i is represented by a bottom pole that shortens or lengthens … good trick. I hear a former professor reminding me: Explaining the oracular with the obscure helps nobody…

  3. August 11th, 2011 at 16:33 | #3

    Dave –

    Explaining the oracular with the obscure helps nobody…

    I usually go at it the other way, and that’s not very effective, either.


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