Month: November 2014

In Which I Confess, Once Again, That I Do Not Understand the Argument for the Taper as Long as Inflation is Below Its Target…: Monday Focus

Posted on by Brad DeLong

As you know, I am of the view that the Federal Reserve ought to be following feedback rule by which it should add to its balance sheet when nominal GDP is below its target and reduce its balance sheet nominal GDP is or imminently threatens to rise above its target. Part of this is that it is not clear to me what the risks are of the Federal Reserve’s having a larger balance sheet as long as inflation is and is expected to remain below its target. It has always seem to me that the more rapid and the more imminent the Federal Reserve can make expectations of economic normalization, the more will long-term interest rates approach their normal levels and the less tempted will be organizations, like commercial banks and insurance companies whose business model is that of holding duration, to reach for yield and so run excessive risks. Conversely, the more rapidly people expect the Federal Reserve’s balance sheet to be unwound and reduced, the greater are the risks of getting stuck for a long time at the ZLB and losing not just one decade–we have already lost one decade of economic growth–but two.

I do not count the risks of the Federal Reserve would have to lose by selling long-term bonds some of the money it is made since 2007 as a risk at all. Does anybody else see that as a risk?

These are serious questions: How does prolonging the time the economy spends at and near the ZLB enhance financial stability? In what sense are the possible losses that the Federal Reserve would suffer on its bond portfolio from a rapid normalization of the interest rates a risk?

Does anybody have any answers?





Am I Imagining a Golden Age That Never Was?: (Late) Friday Focus

Posted on by Brad DeLong

Not to pick on Mr. David Rennie especially–simply this piece of his struck me as very characteristic of a great deal of what I read in the Economist these days (outside its http://economist.com/freeexchange). But:

Economist: The Nostalgia Trap: Politicians need to stop pretending to angry voters that globalisation can be wished away: “THE public is losing faith in the American Dream…

…Mitch McConnell declared…. Now begins a more important contest, Mr McConnell told Kentucky Republicans: the race to save the centuries-old ‘compact’ that every American generation leaves the next one better off. Mr McConnell declared that promise imperilled by ‘distant planners in federal agencies’, whether they are killing jobs in coal mines or–in their zeal to impose Obamacare–cancelling families’ health insurance plans…. Republicans such as Mr McConnell are right to criticise government when it overreaches. But it is a stretch to suggest that reining in environmental rules on coal, or even repealing Obamacare, can revive the American Dream…. Coal mines, steel mills and factories have closed throughout the rich world, in countries with very different governments, labour laws and environmental rules….

American conservatives growl that if the country feels all wrong it is because Democrats buy elections with ‘free stuff’ for the feckless poor, destroying the national work ethic. Democrats say no, it is because Republicans are too heartless to care about the middle classes, and because unpatriotic billionaires send jobs overseas…. This is not a call for political apathy. In every country some policies are better than others, and bad ones should be changed…. But let political leaders everywhere tell their publics the truth: the years of easy post-war growth are gone, replaced by competition that cannot be wished away, and so must be met head-on–and ideally harnessed. That will take hard work and new ideas. Time to wake up.

It almost seems as though as other more-nimble journalistic enterprises enter the new media-substantive analysis space, John Micklethwait’s Economist leaves it. The Economist I read in the late 1970s–back in the days when the very young Jeff Sachs would tell his students “YOU HAVE TO READ THE ECONOMIST!!”–wouldn’t have said anything like:

McConnell declared… ‘distant planners in federal agencies’… are… in their zeal to impose Obamacare… cancelling families’ health insurance plans…. But it is a stretch to suggest that… even repealing Obamacare can revive the American Dream…

The old Economist* would have said, at very least:

McConnell’s adversaries point out that the plans ObamaCare required be cancelled either paid out a much smaller share of premiums than average or did not actually insure against the costly expenses of treating truly serious illnesses…

And something like:

According to the Gallup Organization, the number of Americans without health insurance has fallen by a quarter–that is, by 7.7 million–in the first nine months of ObamaCare’s implementation…

Or, at least, the old Economist as I remember it would have said that. Perhaps I have fuzzy memories of a golden age of journalism on St. James Street that never really was. But I don’t think so: back when I would occasionally teach the late Susan Rasky’s Journalism School students, we would hold up the Economist as something that would stay close to reality–and to quantitative reality–rather than succumbing to the lure of writing beat-sweeteners or degenerating into op-ed word-salad pieces.

Here we most aggressive we get is the forthright:

In every country some policies are better than others, and bad ones should be changed…

And there are hints–but not quite statements–that the Economist does not like: “government when it overreaches” thus “killing jobs in coal mines or–in their zeal to impose Obamacare–cancelling families’ health insurance plans” even though it is a “stretch to suggest that reining [them] in…” plus hints that it does not like “farm subsidies, industrial policies to prop up favoured firms, welfare, transfers from rich countries to poor ones and a dose of protectionism…” There is a statement that “Close the borders! Quit the EU! Secede!” are “false remedies”. But little more save that “countries’ travails owe more to global forces than to [particular politicians’] opponents’ folly…”

David Rennie is a decade younger than I am, but he was 29 in 1999, back when America’s investments in high-tech were paying enormous dividends for the world as a whole and especially for America, and when the burning question of the day was whether the Silicon Valley companies that were at the Bleeding Edge would develop business models that allowed them to make a profit or whether 100% of the benefits from their investments would go to consumers in the form of surplus. He saw the world of the 1990s in which real wages were rising strongly throughout the North Atlantic–albeit more strongly in North America than in Europe, and accompanied by stubbornly-rising income and wealth inequality. Back then in the Clinton years destruction was creative, and globalization was our servant and not our master. Surely a declaration that North Atlantic malaise is due to “global forces” requires at least a sentence explaining why those “global forces” have turned malign since 1999?

I ask the Economist: would an article like this appear in http://vox.com/ or http://nytimes.com/upshot or http://fivethirtyeight.com or http://washingtonpost.com/wonkblog? No. So I ask the Economist: where has your mojo gone? Please stick close to reality. Please be quantitative. Please take stands on the issues of the day.

Be Bagehotian.

If I think you get it wrong in your judgments, I will call you out, true. But if you don’t make judgments, I will do even worse. You will then have transgressed the unwritten law, and in response I will use sarcasm–I know all the tricks: dramatic irony, metaphor, bathos, puns, parody, litotes and satire. And I will say:

Questo misero modo
tegnon l’anime triste di coloro
che visser sanza ‘nfamia e sanza lodo….
Caccianli i ciel per non esser men belli,
né lo profondo inferno li riceve,
ch’alcuna gloria i rei avrebber d’elli…

For if there is one thing that I cannot attribute the gap between what I see today’s Economist as being and Vox, the Upshot, 538, and Wonkblog, I cannot attribute it to global forces.

Afternoon Must-Read: Rob Dent et al.: Measuring Labor Market Slack: Are the Long-Term Unemployed Different?

Posted on by Brad DeLong

Rob Dent et al.: Measuring Labor Market Slack: Are the Long-Term Unemployed Different?: “There has been some debate…

…Krueger, Cramer, and Cho (2014) and Gordon (2013) about whether the short-term unemployment rate is a better measure of slack than the overall unemployment rate…. The two measures are sending different signals…. One can argue that the unemployment rate is exaggerating the extent of underutilization in the labor market, based on the premise that the long-term unemployed are, in practice, out of the labor force and likely to exert little pressure on earnings. If this is indeed the case, inflationary pressures might start building up sooner than suggested by the overall unemployment rate. In a three-part series, we study the available evidence on the long-term unemployed and argue against this premise. The long-term unemployed should not be excluded from measures of labor market slack…

Afternoon Must-Read: Adair Turner: Printing Money to Fund Deficit Is the Fastest Way to Raise Rates

Posted on by Brad DeLong

Adair Turner: Printing money to fund deficit is the fastest way to raise rates – FT.com: “What is the right course for monetary policy?…

…The International Monetary Fund seems to answer with forked tongue. Its latest World Economic Outlook urges that monetary policy should stay loose to stimulate growth. Yet its Global Financial Stability Review warns that loose monetary policy risks creating financial instability…. In fact the best policy is to print money and raise interest rates. That sounds contradictory, but it is not…. Most countries have opted to combine fiscal tightening with ultra-loose monetary policy, setting short-term interest rates close to zero and using quantitative easing to reduce long-term rates and boost asset prices. But… sustained low interest rates create incentives for highly leveraged financial engineering…. The Bank for International Settlements therefore argues that monetary policy should be tightened as well as fiscal, but that would depress demand yet further.

We should indeed seek a swift return to higher interest rates, to remove the dangerous subsidy to high leverage…. The best way to do that, particularly in Japan and the eurozone, would be to deploy a variant of Friedman’s idea of dropping money from a helicopter. Government deficits should temporarily increase, and they should be financed with new money created by the central bank and added permanently to the money supply. Money-financed deficits would increase demand without creating debts that have to be serviced. This would lift either real output or inflation and allow interest rates to return to normal more quickly…

Afternoon Must-Read: Larry Mishel: Washington Post “Wage Freeze” Brain Freeze

Posted on by Brad DeLong

Larry Mishel: Washington Post “Wage Freeze” Brain Freeze: “Mostly the Washington Post issues a smug assessment…

…that ‘[n]othing in the last four decades refutes the basic case for flexible, innovative, American-style capitalism’ but then immediately negates this conclusion by saying ‘if the system doesn’t work for the middle class, it really isn’t working at all.’ If, in fact, the economy is not working for most everybody then perhaps it is worth challenging the way the economy operates, including many of the ways the Post advocates it should operate!

Afternoon Must-Read: Paul Krugman: Contractionary Policies Are Contractionary

Posted on by Brad DeLong

Paul Krugman: Contractionary Policies Are Contractionary – NYTimes.com: “Terrible numbers from Japan….

…The ill-considered sales tax hike of the spring is still doing major damage…. So contractionary policy is contractionary. I could have told you that, and in fact have told you that again and again. But some people still don’t get the message. In Germany, the Bundesbank president opposes expansionary monetary policy because it might reduce the pressure for fiscal austerity: ‘Such purchases might create new incentives to run up debt, besides adding to the reform fatigue in a number of countries’….

That’s actually quite an awesome concern to express at this moment. European recovery has stalled, largely thanks to fiscal contraction; inflation is far below target, and outright deflation looms; and the political basis for the European project is coming apart at the seams. And Weidmann worries that monetary expansion might make life too easy for debtors. But as Wolfgang Munchau says in a terrific column today, ‘German economists roughly fall into two groups: those that have not read Keynes, and those that have not understood Keynes’….

How does this end? We have to keep pounding on the issues, and I’m reasonably sure that Draghi and co get it. But with the largest player on the European scene living in a fantasy world, the best guess has to be that nothing much is done until there is complete political crisis, with anti-European nationalists taking over one or more major nations.

Afternoon Must-Read: Ron Fournier of the National Journal Writes the Worst Two Paragraphs You’ll Read Today

Posted on by Brad DeLong

Matthew Yglesias: The worst two paragraphs about American politics you’ll read today: “Ron Fournier, like many of us…

…is frustrated with the state of American politics…. He explains that the big problem with Obama’s approach was failing to take a page from the Massachusetts universal health care program that is in fact the model for Obamacare:

On health care, we needed a market-driven plan…. Just such a plan sprang out of conservative think tanks and was tested by a GOP governor in Massachusetts, Mitt Romney. Instead of a bipartisan agreement to bring that plan to scale, we got more partisan warfare. The GOP resisted, Obama surrendered his mantle of bipartisanship, and Democrats muscled through a one-sided law that has never been popular with a majority of the public.

It is true that we did not get a bipartisan agreement. It is true that the GOP resisted. It is true that the law is unpopular. But Obama didn’t surrender his mantle of bipartisanship. The GOP took it away from him. They took it away from his as part of a deliberate strategy. They knew, as Fournier says right in this very column, that a big bipartisan health reform would be more popular than a big partisan health reform. So since Republicans didn’t want Obama to be popular, they had every incentive to refuse to reach a bipartisan agreement. And thus no agreement was reached.

But… Obama and congressional Democrats delivered exactly the kind of reform Fournier says America needed. Shouldn’t they be congratulated?… In substance, you still have a program… on the Massachusetts model…. It’s also not something Obama bungled. It’s a consequence of mismatched incentives in Washington…. The opposition party would like the president to not be associated with bipartisan initiatives…. If you don’t understand that, you’ll never understand today’s politics. Worse, you’ll be consistently making bipartisanship less likely. It’s precisely because of columns like this one that it made narrow political sense for the GOP to abjure compromise. Why bargain if any failure to reach agreement will be blamed on the president?

Financial leverage and where to find it

Posted on by Bridget Ansel

Financial leverage is a bit like caffeine. You can get by without it, but using it sparely can help you get through a rough batch. Constant usage, however, can result in overdependence—and the resulting crash is not pretty.

On their blog today, Stephen G. Cecchetti of the Brandeis International Business School and Kremit L. Schoenholtz of New York University’s Stern School of Business detail the role of debt in financial crises. The two academics note that the equity-driven recession of the early 2000s—the so called “dot-com recession”—did not drag the U.S. economy into a prolonged downturn because companies had not loaded up on piles of debt. This lack of leverage among companies rendered the 2000 recession mild compared to the Great Recession of 2007-2009, when imploding mortgage debt among individual homeowners, financial institutions, institutional investors, and other financial intermediaries that purchased these mortgages sank the global economy.

In their piece, Cecchetti and Schoenholtz note that they have yet to find any source that reports the risks that some financial intermediaries are taking in today’s real estate market. That means researchers and regulators are most likely unaware of many of the leveraged risks being taken in the real estate sector. Our understanding is further hindered because we also lack a real-time source of information of the distribution of household leverage.

How is it that such information about leverage and its role of as a financial accelerant is largely missing? After all, researchers and regulators spend a large amount of time figuring out how to measure bank balance sheets. The issue, though, is the amount of debt and assets that are off-balance sheet. Cecchetti and Schoenholtz mention the development of special investment vehicles in the years before the housing and financial crises in the previous decade. These off-balance sheet investments allowed banks to take on even more debt, but their leverage appeared unaffected. In short, the banks could make investments that could reap great returns but hide the risk.

Cecchetti and Schoenholtz focus their piece on the role of leverage in companies, but the story of increasing household debt can be even more important. As Atif Mian of Princeton University and Amir Sufi of the University of Chicago document, prior to the Great Recession household leverage increased dramatically as households took on more and more mortgage debt. The areas that saw housing prices drop the most then saw significant reductions in consumer spending. And the increase in household leverage was evident across the rich economies in the run up to the Great Recession.

Considering how intertwined the housing market has become with the financial system, the twin increases in leverage can be a toxic mix. We would all be better served if these dangerous gaps in our knowledge were filled.

Things to Read at Nighttime on November 16, 2014

Posted on by Brad DeLong

Must- and Shall-Reads:)

 

  1. Scott Erik Kaufman: There is privilege, then there is privilege…: “…and then there is whatever this is: George W. Bush: ‘You have to earn your way into politics,’ nothing ‘is ever given to you’](http://www.rawstory.com/rs/2014/11/george-w-bush-you-have-to-earn-your-way-into-politics-nothing-is-ever-given-to-you/)

  2. Mike Konczal: The UNC Coup and the Second Limit of Economic Liberalism: “There was a quiet revolution in the University of North Carolina higher education system in August, one that shows an important limit of current liberal thought…. The UNC System Board of Governors voted unanimously to cap the amount of tuition that may be used for financial aid for need-based students at no more than 15 percent…. As a board member told the local press, the burden of providing need-based aid ‘has become unfairly apportioned to working North Carolinians,’ and this new policy helps prevent that…. The problem for liberals isn’t just that there’s no way for them to win this argument with middle-class wages stagnating…. The far bigger issue for liberals is that this is a false choice, a real class antagonism that has been created entirely by the process of state disinvestment, privatization, cost-shifting of tuitions away from general revenues to individual, and the subsequent explosion in student debt. As long as liberals continue to play this game, they’ll be undermining their chances…”

  3. Wolfgang Munchau: The wacky economics of Germany’s parallel universe: “German economists roughly fall into two groups: those that have not read Keynes, and those that have not understood Keynes. To describe the economic mainstream in Germany as conservative misses the point…. As compelling as a comparison between the German mainstream and the Tea Party may appear, it does not survive scrutiny…. A good example of orthodox dogma was last week’s annual report of the Council of Economic Experts…. They did not criticise a lack of investment, excessive current account surpluses or overzealous fiscal rectitude. Instead they criticised the minimum wage and some minor relaxation to the retirement age. In other words: they want the government of Angela Merkel, chancellor, to be even tougher…. Macroeconomics in Germany and elsewhere are tantamount to parallel universes. In practice, German macroeconomic exceptionalism did not really matter all that much–until recently, when it started to matter a lot. When you have your own currency and engage with the rest of the world mainly through trade, a wacky ideology is your problem. That changes when you enter a monetary union, which is when policy makers have to work together…”

  4. Kevin Drum: People Who Use Obamacare Sure Do Like It | Mother Jones: “Jonathan Cohn points us today to a Gallup poll with yet more good news for Obamacare…. The people who are actually using Obamacare… 74 percent said the quality of health care they received was good or excellent, and 71 percent said the overall coverage was good or excellent. What’s remarkable is that these numbers are nearly the same as those for everyone else with health insurance, which includes those with either employer coverage or Medicare. Here’s the bottom line from Cohn: ‘You hear a lot about what’s wrong with the coverage available through the marketplaces and some of these criticisms are legitimate. The narrow networks of providers are confusing, for example, and lack of sufficient regulations leaves some patients unfairly on the hook for ridiculously high bills. But overall the plans turn out to be as popular as other forms of private and public insurance. It’s one more sign that, if you can just block out the negative headlines and political attacks, you’ll discover a program that is working.’ Republicans can huff and puff all they want, but the evidence is clear: despite its rollout problems, Obamacare is a success…”

  5. Nick Bunker: What the Beveridge Curve may tell us about the U.S. labor market: “Tthe Federal Reserve Bank of Cleveland used historical data on printed job advertisements to create a jobs opening rate for years prior to 2000. And if you look at their Beveridge Curve for economic recoveries going back over 60 years, you see the current shift is actually quite typical. The curve appears to shift quite a bit (up and over to the right) after large recessions and shifts back (down and over to the left) after the labor market recovers from the large shock…”

  6. Dani Rodrik: Mexico’s Growth Problem: “When Mexico’s then-[Usurper] President Carlos Salinas de Gortari and his American counterpart, Bill Clinton, signed the North American Free Trade Agreement (NAFTA) more than 20 years ago, the hope was that the Mexican economy would be swept forward by a rising wave of globalization. By many measures, that hope has been amply fulfilled. Mexico’s foreign-trade volume… climbed… roughly doubling, to more than 60% of GDP. Net foreign investment inflows relative to GDP tripled… manufactured exports have led the way, as the economy has become ever more tightly integrated into North American supply chains…. Like so many other countries, Mexico was initially hit hard by Chinese competition in global markets…. Nonetheless, Mexico’s proximity to the US market and its conservative monetary, fiscal, and labor-market policies have provided significant protection…. Remarkably, Mexico’s exceedingly high levels of inequality have begun to fall since 1994, thanks in large part to reforms in social policy and educational improvements. Mexico’s success shows up everywhere, except where it counts the most over the long term: overall productivity and economic growth. In both areas, there has been disappointment galore… growth in total factor productivity… has been negative since the early 1990s… living standards in Mexico have fallen further behind the US and most emerging-market economies. Probably no other country in the world presents a starker contrast between external success and domestic failure…”

  7. Bridget Ansel: The evolution of class-based gaps in young children’s home environments: “The racial gaps in test scores are narrowing…. Yet there is an even larger skills gap between children in low and high income households… sizeable before they even enter kindergarten. In fact, the achievement gap between the rich and the poor is widening dramatically, so much so that income is now a better predictor of test scores than race…. Ariel Kalil… will document and examine whether and how these class-based gaps in parenting have changed over the past 25 years, and if so, whether these changes contribute to the growing income-based achievement gap. It is clear that the fate of low- and high-income Americans has diverged in terms of educational attainment and cognitive skills, such as memory, reasoning, perception and intuition. Can the same be said for non-cognitive skills, such as resilience, motivation and attentiveness, necessary precursors for cognitive skill acquisition?…”

  8. D.J. Diff: The Halbig Challengers’ Biggest Textual Obstacle: “The challengers have a big textual obstacle standing in their way: the statute’s provision for federal exchanges in section 1321…. Unlike the ACA’s Medicaid provisions, the exchange provisions have a federal fallback…. This isn’t Medicaid; it’s the Clean Air Act (CAA)…. If the state turns down the ACA’s inducement to create an exchange, then under the challengers’ view the state’s ‘punishment’ is not merely the withholding of funds—it’s the withholding of funds and the creation of a federal exchange to operate in the state. This is an odd kind of inducement. Without the availability of subsidies, the federal exchange is an empty shell…. For devotees of the Cato Institute, perhaps this would be a convincing pitch: ‘If you don’t create a state exchange then we’ll set up a costly, ineffective, useless federal program in your state’…. ‘Attention states! You need to set up a program to provide health care to low-income individuals. If you set up such a program, then the federal government will give you lots of money to help run it. However, if you decline, then you don’t get the money. Moreover, if you decline we’ll spend millions of dollars on a totally useless web portal for low-income individuals to purchase health care in your state. But the health care on the portal will be too expensive for those folks to afford. And the website won’t even work well.’ Under the challengers’ view, that is the system of incentives and cooperative federalism that Congress intended to create in the ACA. It doesn’t make a whole lot of sense…. Alternatively, we could avoid all of this assumed ineffectiveness and just adopt a reading of section 1321 that allows federal exchanges to stand in the shoes of state exchanges. Then the ACA’s ‘fallback’ structure actually makes sense…”

Should Be Aware of:

 

  1. Paul Krugman: Rage of the Traders: “I really, truly expected that even Wall Street would consider PeterPaul Singer’s hyperinflation in the Hamptons rant embarrassing, and try to pretend that it never happened. But no; apparently it’s being passed around eagerly by traders and big shots who think it’s the greatest thing since sliced foie gras…. Jesse Eisinger at ProPublica tries to make a case for the rage of the hedgies… argu[ing that]… the government and the Fed have created a fake sense of financial health…. Eisinger is imputing a reasonable analysis to the likes of Singer based on no evidence…. I’d suggest that when Singer talks about a debased currency and fake economic growth, that’s because he really believes that we have a debased currency and fake growth, not as a metaphor for some other kind of economic deception. And where is that perception coming from? I still think that Brad DeLong’s analysis has it right…. Traders… concluded that low interest rates would surely rise back to historical norms. When those rates did no such thing, they looked at the Fed’s intervention… [as] a big trader distorting markets, London Whale-style, by making huge bets that would surely go bad. So they sat back and waited for the collapse. And the collapse keeps not happening, because the Fed is not a rogue trader and historical norms for interest rates aren’t relevant in a persistently depressed, deleveraging economy. But rather than acknowledge that they were wrong, let alone that, er, Keynesian macroeconomics has something to teach them, these guys lash out…. [And they] have no idea when they look ridiculous. After all, who in their entourage is going to tell them?”

  2. Robert Solow: The Ramsey model: “Friends have reminded me that much of the effort of ‘modern macro’ goes into the incorporation of important deviations from the Panglossian assumptions that underlie the simplistic application of the Ramsey model… wage and price stickiness, gaps and asymmetries of information, long-term contracts, imperfect competition, search, bargaining and other forms of strategic behavior…. But… why do so many of those research papers begin with a bow to the Ramsey model and cling to the basic outline?… Attaching a realistic or behavioral deviation to the Ramsey model does not confer microfoundational legitimacy on the combination. Quite the contrary: a story loses legitimacy and credibility when it is spliced to a simple, extreme, and on the face of it, irrelevant special case…. Adding some realistic frictions does not make it any more plausible that an observed economy is acting out the desires of a single, consistent, forward-looking intelligence…. The theory is neat, learnable, not terribly difficult, but just technical enough to feel like ‘science’…”

  3. Rex Sorgatz: Surfing, Drowning, Diving: A Brief History of Inventing New Media: “15 years ago, the surface cracked open. The glossy patina of digital television ruptured, revealing its polar opposite: bewildering depth…. Blogger (1999) forecasts a future where every person creates their own content empire. This triggers a decade of schizoid seizures in old media companies…. Napster (1999) transforms your computer into a music database server, as the history of human recording becomes instantly available. Wikipedia (2001) turns human knowledge into a massive data repository…. Google News (2002) is invented to capture all the content that media companies were moving to digital platforms…. The Long Tail (2004)…. YouTube (2005) begins to archive every moving image ever created…. In 2010, NYT licenses FiveThirtyEight, one of the first attempts to control the data deluge. Netflix Streaming (2007) shifts Netflix from a superficial ‘surfing’ technology (three DVDs, no more) to a ‘drowning’ experience…. By 2010, we were drowning…. We are now in the era of the deep dive. Consider the media buzzwords of this moment: think piece, longform, recap, and binge watch. All of these terms suggest a break from the era of big data into the epoch of deep exploration. The most successful recent innovations illustrate the shift…. Phase One: Surfing…. Phase Two: Drowning…. Phase Three: Diving…. The water is warm, come on in.”