Must-reads: December 21, 2015
- : The Knowledge Transmission Mechanism and Austerity: “Central banks therefore played a crucial role in the failure of the K[nowledge ]T[ransmission ]M[echanism in 2010.” :: A good wrestle with a very tough intellectual problem by the truly excellent Simon Wren-Lewis
- (1958): Discussion: “That would indeed be a great feather in its cap and ultimately its success would be great…” :: And if the Federal Reserve System were to adopt bad policies in the hope of preserving its political independence, its political independence is already lost…
- : The Woes of the Asset Managers: “Goldman is going slash-and-burn for factor investing market share with a pricing structure that rivals what State Street, Schwab, Vanguard and BlackRock are charging for plain vanilla index exposure…” :: Passive diversified portfolios with an eye toward overweighting factors that have historically offered high returns is what nearly all investors *should be doing.*
- : The Upward Redistribution of Income: Are Rents the Story?: “[My] argument on rents is important because… it means that there is nothing intrinsic to capitalism that led to this rapid rise in inequality…” :: I think Piketty would say that Baker is wrong here…