Largely because I’m technologically impaired, I don’t follow a large number of blogs. So even if I zing a certain blogger regularly, he should feel flattered. In that light, I offer the following two items:
==> I was mostly being a smart aleck when I pointed out that Scott Sumner was being Krugman-esque when he seemed to be saying that the Fed’s pivotal September rate decision would be a “natural experiment,” except when things didn’t play out the way Scott would have predicted. I figured Scott would either ignore me or say something like, “*sigh* OK Bob, I didn’t phrase that right, what I meant was…” and we would move on with our lives.
But look at the exchange between Scott and others who jumped into the fray, including David R. Henderson. Scott kept digging himself deeper. At one point he wrote: “David, Yes, I meant it’s a natural experiment who’s outcome is hard to read. I thought we’d get a clear reading, but we didn’t. So it’s as if there was no experiment at all. The test tube was accidentally dropped on the floor, before we could get a clear reading of the contents.”
Yikes! Scott agreed with David’s paraphrase of what Scott could have been trying to say, but then went totally off the rails. Vivian Darkbloom smelled blood in the water and pounced:
“The test tube was accidentally dropped on the floor, before we could get a clear reading of the contents.”
That’s not it at all. The contents of the test tube, i.e., the record of the stock market movements, is very clear. The fact that you don’t know what conclusions to draw from the contents of that test tube doesn’t mean the contents are unknown because the test tube was dropped. Science shouldn’t disregard test results simply because they don’t go the way one originally predicted. This isn’t a case of a dropped test tube; it appears to be a case of throwing the contents of the test tube out after the experiment was conducted It is not as if there was no experiment.
Now to be sure, I’m not saying Scott Sumner’s ill-advised handling of this challenge to an offhand remark on his blog post destroys the case for NGDP targeting. Indeed, I continue to be impressed with how much traction the idea is gaining, when seven years ago nobody knew what NGDP even was. All I’m saying is, keep your eye on that Sumner fellow.