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- | Welcome again as MIT Professor Paul Samuelson | 0:02 |
discusses the current economic scene. | 0:04 | |
This biweekly series is produced by | 0:07 | |
Instructional Dynamics Incorporated | 0:09 | |
and was recorded on September 8th, 1970. | 0:11 | |
- | In my last tape, I talked about | 0:14 |
the longer term vista, | 0:17 | |
looking five or 10 years ahead. | 0:19 | |
We by no means exhausted that topic, | 0:22 | |
and I hope in an early tape to return to that subject. | 0:24 | |
But I think today I should address myself | 0:29 | |
to where we stand in the business situation. | 0:33 | |
I'm more interested in doing so because | 0:38 | |
just recently, I wrote a piece | 0:42 | |
for the London Financial Times | 0:45 | |
and it's been nine months since I prepared | 0:48 | |
an earlier piece for them | 0:53 | |
and so I had to think through what changes | 0:54 | |
recent experiences had brought to my thinking. | 0:58 | |
Also, in a recent Newsweek column, | 1:02 | |
I went over something of the same ground, | 1:05 | |
and from a policy viewpoint, I was asked by | 1:08 | |
the financial editor of The Washington Post | 1:12 | |
to be a guest columnist | 1:14 | |
and give my opinion of what's been going on in Washington. | 1:16 | |
And therefore let me today | 1:22 | |
talk about these different topics. | 1:26 | |
One of the advantages of the tape format | 1:28 | |
is that you have more time to go in depth | 1:31 | |
into the reasons behind what you have necessarily | 1:33 | |
to write very briefly in writing for the financial press. | 1:38 | |
In the beginning, let me say | 1:46 | |
that it now looks as if | 1:47 | |
the recession is definitely and recognizably over. | 1:50 | |
I called it a recession, | 1:57 | |
but my present guess is, if I had to bet a lot of money | 2:01 | |
at even odds, that when the National Bureau meets | 2:07 | |
a few years from now and its jury goes out to decide | 2:11 | |
whether or not we had a recession, | 2:15 | |
they will have to decide | 2:17 | |
that we haven't even had a recession, | 2:18 | |
that this is another one of those almost recessions | 2:21 | |
or mini recessions. | 2:24 | |
It certainly has not been a decline | 2:28 | |
that was as strong as the 1960-61 recession, | 2:31 | |
which up until now is probably the weakest recession | 2:36 | |
that has ever been officially recognized | 2:39 | |
by the National Bureau. | 2:41 | |
Now, that's my opinion, | 2:42 | |
but it's a very tentative opinion. | 2:44 | |
I feel a little more encouraged in it | 2:46 | |
by something I read in the newspaper a week or two ago | 2:48 | |
that the single man at the National Bureau, | 2:51 | |
Juster I guess his name is, Tom Juster, | 2:57 | |
who has been given this job to decide, | 3:01 | |
the real experts Arthur Burns and Geoffrey Moore | 3:07 | |
who used to do this job | 3:11 | |
are both on the firing line in Washington. | 3:13 | |
Juster was quoted in the press | 3:16 | |
as saying that it looks as if it was not a recession | 3:18 | |
and we just have to use the name retardation | 3:21 | |
for the period. | 3:25 | |
Well, it doesn't matter really what you call it | 3:27 | |
except that I have found that analysts are thrown off | 3:30 | |
by their own language in this matter. | 3:34 | |
If we use the test of real gross national product, | 3:41 | |
it appears that the turn came | 3:46 | |
as early as April Fools' Day | 3:49 | |
but that isn't the only test that one can use | 3:54 | |
for business cycle purposes. | 3:56 | |
If you had thought this was a real recession, | 3:58 | |
you might use the diffusion indexes of the National Bureau | 4:00 | |
and by that test, it seems to me the change | 4:04 | |
might well be put at December. | 4:11 | |
Now, I mention in an earlier tape | 4:15 | |
that the leading indicators | 4:18 | |
did not suggest that the turn was near. | 4:20 | |
So much the worse I may say for the leading indicators. | 4:24 | |
This is an occasion where the leaders | 4:28 | |
have been lagging behind the crowd. | 4:31 | |
Indeed, it was not until the June figures got revised, | 4:34 | |
which itself was not until the July figures were put out, | 4:40 | |
that it turned out that the leading indicators | 4:43 | |
had weekly turned up in June. | 4:45 | |
In July, they turned up a little bit more. | 4:50 | |
Now, if the leading indicators were a really dandy, | 4:53 | |
peachy approach, to be most useful to us, | 4:56 | |
they ought to go up about three or four months before the | 5:00 | |
coincidental indicators do. | 5:06 | |
Unfortunately, even in our previous experience | 5:10 | |
in the post-World War II period, | 5:14 | |
they've developed a bad habit | 5:17 | |
of going up only one or two months | 5:19 | |
before the business cycle turn itself. | 5:22 | |
And by that test, | 5:27 | |
a Washington official told me very ruefully, | 5:30 | |
that he was afraid | 5:33 | |
that we would not have an upturn even before September | 5:35 | |
when he looked at the leading indicators. | 5:40 | |
However, now that the June figures have been revised, | 5:44 | |
if we put a two-month lag, | 5:47 | |
which is sort of the minimal lag, | 5:49 | |
then at the very latest, | 5:51 | |
by August, the month that just passed, | 5:53 | |
the turn came. | 5:56 | |
I think probably if you're going to call it turn like that, | 5:59 | |
July would be a better date. | 6:02 | |
I'm referring to the fact that quite a number of | 6:07 | |
things like new orders, including even military orders, | 6:10 | |
even though the defense sector has been declining, | 6:15 | |
military, new durable goods orders went up | 6:20 | |
a great deal at the end of the old budget year, | 6:23 | |
that is, right at the beginning of the new budget year. | 6:28 | |
Now it's true, those figures have been revised downward | 6:30 | |
so that the increase isn't as big. | 6:34 | |
It's a simple matter of course. | 6:36 | |
The bureaucracy gets its money on an annual basis, | 6:38 | |
fiscal year basis, changing in the middle of the year, | 6:42 | |
and they have a lot of pent-up demands | 6:45 | |
which the day after the new budget period comes, | 6:49 | |
materialize in the form of orders. | 6:52 | |
You might think that with proper seasonal corrections, | 6:55 | |
we wouldn't be at the mercy of such vicissitudes | 6:59 | |
of bureaucratic planning. | 7:03 | |
But it's not an easy matter | 7:06 | |
to get the bureaucrats in a steady state | 7:07 | |
and get a reliable seasonal correction. | 7:11 | |
So we do have had this year and last year | 7:14 | |
a big jump in the middle of the year in military orders. | 7:19 | |
Well now, discounting all that, | 7:21 | |
we still had an improvement then, | 7:24 | |
we had improvements in some other new orders, | 7:28 | |
quite a number of different | 7:30 | |
bits of information that came out in July | 7:34 | |
looked a little bit better. | 7:36 | |
I personally prefer to call this period | 7:42 | |
a period of retardation | 7:46 | |
because if you do that, then | 7:48 | |
there's been no corner for us to turn | 7:54 | |
in the last few months | 7:56 | |
and it's foolish to say that it happened in April, | 7:58 | |
that it happened in May, June, or July. | 8:01 | |
There is nothing that happened or is to happen | 8:05 | |
because if you are addressing yourself | 8:08 | |
to being in a retardation period, | 8:12 | |
which merely means that the real GNP | 8:15 | |
is growing less than the labor force | 8:19 | |
and the growth in our industrial capacity permits | 8:23 | |
so that the gap between what we are actually producing | 8:25 | |
and what is producible, our potential GNP, is increasing. | 8:29 | |
If that's your definition of a period of retardation, | 8:35 | |
then the sad truth is that we are not at the end of that | 8:38 | |
nor in my judgment does it look as if | 8:42 | |
we'll be at the end of it in this calendar year at all. | 8:46 | |
Probably it will take us sometime into 1971 | 8:50 | |
before real output is growing at, say, a 4% rate. | 8:57 | |
Now when that happens, when that happy date arrives, | 9:03 | |
we shall not be at full employment. | 9:08 | |
It will simply mean that we are not losing ground | 9:10 | |
and having the gap increase. | 9:13 | |
In order to get back to full employment, | 9:17 | |
you would have to go for a | 9:20 | |
considerably longer period of time, | 9:21 | |
where the real output is growing at more than 4% per annum | 9:24 | |
eating into the backlog of gap | 9:31 | |
built up in the period of retardation. | 9:33 | |
And although my crystal ball gets very clouded | 9:37 | |
when we talk about things more than four quarters ahead, | 9:40 | |
indeed, it's clouded enough when we talk about today, | 9:44 | |
tomorrow, and yesterday, | 9:49 | |
nevertheless, I see no reasoned argument | 9:51 | |
that cogently suggests that anytime in 1971 | 9:57 | |
we will have returned to full employment and to no gap. | 10:04 | |
I think this is interesting for me to state | 10:10 | |
because I was terribly surprised | 10:14 | |
that in the middle of July | 10:18 | |
on I think a Friday, | 10:22 | |
Chairman Arthur Burns of the Federal Reserve Board | 10:23 | |
testified before the Joint Economic Committee. | 10:28 | |
It happened to be, it was a Thursday, | 10:31 | |
it happened to be the day after I testified. | 10:34 | |
And so, when I was back home in Boston, | 10:38 | |
I read to see whether his testimony was pretty much in line | 10:41 | |
with my own. | 10:46 | |
For the most part, it seems to me it was, | 10:48 | |
but I was terribly surprised to see that he had said | 10:52 | |
to the Joint Economic Committee | 10:56 | |
that we would be back at full employment sometime in 1971. | 10:59 | |
I wasn't the only person surprised. | 11:06 | |
According to the account, I looked in The Washington Post, | 11:08 | |
I looked in The Wall Street Journal, | 11:11 | |
I looked in The New York Times, | 11:12 | |
got pretty good coverage from different angles | 11:14 | |
of the testimony, | 11:16 | |
the members of the Joint Economic Committee apparently | 11:18 | |
were dumbfounded and said, do you really think | 11:21 | |
that in 1971? | 11:25 | |
And apparently that was Chairman Burns's opinion. | 11:28 | |
Now, I'm not privy to what goes on in the minds | 11:32 | |
of the other six members of the Federal Reserve Board, | 11:37 | |
to say nothing of the 12 presidents of the Federal Reserve | 11:41 | |
regional banks who meet together | 11:46 | |
at the Open Market Committee, | 11:49 | |
not all of them have a vote each year, | 11:51 | |
I guess just five of them do. | 11:53 | |
But I know enough about their general utterances | 11:55 | |
and opinions to be reasonably sure in my own mind | 12:00 | |
that Arthur Burns's own colleagues were astonished | 12:05 | |
to hear from his lips that he expects full employment | 12:09 | |
sometime in 1971. | 12:15 | |
I may say and I think this is worth stressing | 12:18 | |
that in his prepared remarks there was no sentence | 12:23 | |
suggesting this fact. | 12:28 | |
You might say in the heat of testifying | 12:31 | |
this is what came out. | 12:33 | |
Well, there's a Latin phrase, in vino veritas, | 12:35 | |
in your cups you really tell the truth, | 12:39 | |
but there's an old English phrase, | 12:42 | |
that you can't trust a drunk. | 12:45 | |
And I would myself rather go by the prepared testimony | 12:48 | |
of an expert than by what he says off the cuff. | 12:53 | |
And so I don't think we should attach | 12:58 | |
too much importance to it. | 13:00 | |
But since Arthur Burns is in a very key position | 13:01 | |
and since he is | 13:07 | |
recognized as one of our leading scholars of business cycles | 13:11 | |
the heir to the late Wesley Mitchell | 13:14 | |
in carrying on studies of business cycles | 13:17 | |
in the United States and all over the world | 13:20 | |
at the National Bureau of Economic Research in New York | 13:22 | |
and at Columbia University, | 13:25 | |
I think that we ought to pore over every word, | 13:28 | |
his discretions and his indiscretions. | 13:32 | |
I should point out that in 1954, | 13:38 | |
when perhaps we were in a similar situation, | 13:45 | |
the country coming out of a recession | 13:47 | |
or a period of retardation, | 13:51 | |
all the experts thought that 1955 would be | 13:56 | |
a year of modest expansion, | 13:59 | |
but not Arthur Burns, | 14:03 | |
the chairman of Eisenhower's Council of Economic Advisers. | 14:04 | |
He predicted that 1955 | 14:08 | |
would be a year of very strong expansion. | 14:11 | |
He predicted it on the basis of | 14:15 | |
nothing that could be seen in the data. | 14:18 | |
As I expressed it a little bit later | 14:22 | |
in one of my financial writings | 14:25 | |
that Pascal said the heart has reasons | 14:29 | |
that reason will never know, | 14:34 | |
Arthur Burns apparently has reasons | 14:36 | |
that expert reason will never know. | 14:39 | |
The point of my dredging up this incident from the past was | 14:43 | |
that who do you think was right? | 14:46 | |
Dr. Arthur F. Burns was correct. | 14:49 | |
1955 was an extremely strong year. | 14:52 | |
It was stronger than any of the other experts had thought. | 14:57 | |
And so, on the basis of that incident, | 15:02 | |
we would be inclined to say that | 15:05 | |
he has a way of seeing into the future | 15:08 | |
that should give us pause if we disagree with him | 15:10 | |
and we should take very seriously | 15:13 | |
his utterance that we should be back to full employment. | 15:14 | |
However, we have to look at the whole historical record, | 15:18 | |
and I recall very well that on April 27th, 1961, | 15:21 | |
barely two or three months after we now know | 15:26 | |
the 1960-61 recession had come to an end, | 15:30 | |
Arthur Burns gave a speech in Chicago. | 15:34 | |
And in that speech, he gave | 15:37 | |
what is slightly uncharacteristic for him | 15:40 | |
a flatfooted prediction that the | 15:43 | |
economy would reach full employment | 15:47 | |
and there was some subsidiary evidence | 15:49 | |
that suggested that he meant by that a 4% unemployment rate, | 15:51 | |
the so-called proximate goal, | 15:56 | |
within 15 or 18 months from April 27th of 1961. | 15:58 | |
Well, so impressed have I always been | 16:03 | |
by the erudition of Dr. Burns | 16:06 | |
that I put that down in my calendar | 16:10 | |
and I kept waiting at 12 months | 16:12 | |
to see whether we were at full employment. | 16:13 | |
And we were very far from it. | 16:15 | |
And at 13 months and at 14 months, | 16:17 | |
well, to make a long story short, | 16:19 | |
he was off by years. | 16:21 | |
Not only was he off by years, | 16:23 | |
it would have taken two or three years later | 16:25 | |
to reach that goal, but if the policy recommendations | 16:26 | |
which were made in that April 27th speech, | 16:31 | |
which was to curtail the macroeconomic stimulus, | 16:34 | |
had been followed | 16:40 | |
instead of what was actually followed, | 16:43 | |
which was a Berlin Wall crisis, | 16:45 | |
which increased our military expenditures | 16:47 | |
and innumerable more expansionary acts | 16:51 | |
which he had warned against, | 16:54 | |
that even in the face of that greater expansionary policy | 16:56 | |
that he himself recommended, | 16:59 | |
we did not get to full employment. | 17:01 | |
I should give you my opinion. | 17:05 | |
My guess is that the 1971 experience | 17:08 | |
will be more nearly like that of 1961 | 17:14 | |
than it will be of 1954 | 17:18 | |
and that any of you who are making plans | 17:21 | |
on business expansion, | 17:25 | |
that you should premise your plans | 17:30 | |
upon our being now in a period of expansion | 17:33 | |
but not in a period of strong expansion | 17:36 | |
which will carry us soon back to full employment. | 17:40 | |
Now when I make a prediction like that, | 17:48 | |
I obviously have certain policy | 17:51 | |
assumptions in the back of my mind. | 17:54 | |
I ought to make them clear for you. | 17:57 | |
I'm assuming that the decline in defense expenditure, | 18:00 | |
which has been going on now for some years | 18:03 | |
and for which I commend President Nixon, | 18:05 | |
I only wish we were doing this at a more rapid rate. | 18:08 | |
I'm assuming there will be continuation of that, | 18:12 | |
that as we pull resources and money out of | 18:14 | |
Vietnam, we will not commit | 18:19 | |
all of those resources back into some other ABM | 18:22 | |
or other aspect of the defense program. | 18:26 | |
My own wish is that we would be doing this more rapidly, | 18:31 | |
but that's beside the point. | 18:34 | |
I'm assuming obviously that there will be no | 18:37 | |
Middle East crisis, which will cause a whole new ballgame | 18:40 | |
with respect to resources going into the Feds. | 18:44 | |
I assume there will be no Middle East crisis not because | 18:48 | |
I have any special knowledge that there will be none | 18:51 | |
or that I would hope that there would be none | 18:54 | |
but simply I don't have enough specialized knowledge | 18:56 | |
to assume the contrary, | 18:59 | |
and if you do, you should modify my assumptions. | 19:01 | |
What am I assuming about strikes? | 19:06 | |
Well, I'm assuming that, | 19:09 | |
with pretty good probability, | 19:13 | |
there will be a auto strike this fall. | 19:14 | |
This auto strike, we just now learned, | 19:17 | |
will not be against Ford | 19:20 | |
but could be against Chrysler or General Motors. | 19:22 | |
My guess would be, if there is to be strike, | 19:25 | |
that it will be against General Motors. | 19:28 | |
My only reason for that I guess | 19:30 | |
is that Chrysler is pretty shaky | 19:33 | |
and could not, I would suppose, take a strike very well, | 19:36 | |
and I think that the UAW is not so stupid | 19:40 | |
as to want to kill the weak goose that lays the golden eggs. | 19:42 | |
Of course, against this argument is the fact | 19:51 | |
that General Motors is awfully tough to come up against. | 19:52 | |
Nevertheless, I'm assuming a strike. | 19:56 | |
But how much difference does that make | 19:57 | |
if I'm wrong in that? | 19:58 | |
I think the primary difference is | 20:00 | |
if there is a strike, | 20:04 | |
you'll move some of the strength of the | 20:05 | |
last quarter of the year into the first quarter next year. | 20:09 | |
But over the half of the year, | 20:12 | |
beginning with the last quarter, | 20:15 | |
things won't be very much different. | 20:18 | |
How much would be likely to be changed? | 20:20 | |
I would suppose that on a calendar year basis, | 20:27 | |
let me just give you some rough figures. | 20:32 | |
Remember I gave you the number of 977 billion | 20:33 | |
as my best guess for the calendar 1970 GNP? | 20:36 | |
I suppose I gave that guess around the end of June. | 20:43 | |
It looks pretty good to me, that particular number now. | 20:49 | |
And it was premised upon the significant probability | 20:52 | |
there would be a strike. | 20:55 | |
How much should we add to 977 | 20:58 | |
if there is no strike in this calendar year? | 20:59 | |
I would suppose that we ought to add | 21:02 | |
a billion and a half dollars, say. | 21:04 | |
That means the fourth quarter numbers, | 21:08 | |
you would have more than that | 21:10 | |
because the calendar year averages divides by the four, | 21:13 | |
all the quarters in getting the average number. | 21:17 | |
But that's the sum total of the magnitude. | 21:21 | |
Now I don't mean to suggest that everything cancels out. | 21:25 | |
If I were the sales manager | 21:29 | |
for the western hemisphere of Volkswagen | 21:32 | |
or for the Japanese cars, the Toyota and the Datsun, | 21:35 | |
I would hope that there'd be a strike | 21:40 | |
because that would be a very good opportunity for me. | 21:41 | |
So it'd be a little loss to the economy, | 21:44 | |
which is permanent if there is a strike, | 21:47 | |
but nevertheless, it's not a crucial factor. | 21:48 | |
When do we reach that trillion dollar GNP? | 21:55 | |
At the beginning of this year, when I was too optimistic, | 22:01 | |
I have since of course scaled down my numbers, | 22:03 | |
I said sometime between Labor Day and Thanksgiving, | 22:07 | |
the American economy will be having a trillion dollar GNP. | 22:13 | |
Of course, the people who expected there to be | 22:19 | |
a rather serious recession, | 22:21 | |
like the 1958-59 recession or worse, | 22:23 | |
57-58 recession or worse, | 22:27 | |
haven't expected the trillion dollar number | 22:31 | |
to be reached in this year or until well into next year. | 22:34 | |
Labor Day is here. | 22:39 | |
We are not at a trillion dollars. | 22:41 | |
I would now have to say | 22:45 | |
since I have written down a 990 billion estimate | 22:47 | |
to a 977 odd, that it will be the Thanksgiving date | 22:51 | |
when we reach that particular number. | 22:59 | |
I still would prefer to bet that we reach it in 1970 | 23:02 | |
if I had to bet with Las Vegas | 23:06 | |
a sizable sum of number at even odds, | 23:10 | |
I would be forced to bet, prefer the side | 23:13 | |
that would reach the trillion dollar annual rate | 23:17 | |
within this year rather than next year. | 23:20 | |
I've given you my opinion. | 23:27 | |
Question to ask is whether | 23:30 | |
everybody agrees with that opinion. | 23:32 | |
What are the reasoned divergences from that opinion? | 23:36 | |
Well, of course, everybody doesn't agree | 23:45 | |
with any opinion in economics at any time, | 23:46 | |
and this time is no exception. | 23:49 | |
Let me go over the field. | 23:52 | |
Dr. Pierre Rinfret, who had been the biggest bull, | 23:57 | |
who had been 12 or 13 billion dollars, | 24:01 | |
that's one and 1/2 percent over my own estimates | 24:05 | |
for the year, is not, as I read his stuff, | 24:10 | |
is not in particular disagreement with my new viewpoint | 24:15 | |
because he has been writing recently | 24:18 | |
on the deflationary gap and not on the inflationary gap. | 24:20 | |
What about the official government figures? | 24:26 | |
We haven't had any official government figures | 24:31 | |
since the annual report. | 24:36 | |
At the time of the annual report, | 24:39 | |
I was pretty close to those numbers, | 24:41 | |
a little bit higher but I had made my estimate | 24:43 | |
two months earlier when they also, I think, | 24:45 | |
were a little bit higher. | 24:48 | |
My guess is that Paul McCracken is doing a lot better, | 24:51 | |
sleeping a lot more easily these days | 24:56 | |
now that the rate of inflation has | 24:59 | |
shown a little bit of improvement, | 25:01 | |
at least on a seasonally corrected and smoothed basis | 25:04 | |
and now that the turn has taken place. | 25:07 | |
So I would think that his numbers are pretty close to mine. | 25:10 | |
Somebody like Otto Eckstein | 25:16 | |
who was even higher than I was | 25:20 | |
is about in the same ballpark as my estimates I think. | 25:23 | |
You'd have to take his service, | 25:28 | |
data resources to get detailed figures. | 25:30 | |
Maybe he's a little bit higher still than my numbers. | 25:34 | |
There have been very few heroes this year in forecasting. | 25:39 | |
I don't know where | 25:44 | |
because I haven't been able to find anything | 25:45 | |
in the public press, | 25:47 | |
where the First National City Bank now stands, | 25:48 | |
but it's obvious that they must have changed | 25:52 | |
as I predicted they would | 25:57 | |
their 965 billion dollar estimate | 25:59 | |
that they made for the year earlier. | 26:03 | |
We're already well beyond that number | 26:06 | |
in what's happened already. | 26:10 | |
The qualitative monetarists, it seems to me, | 26:15 | |
have not had a good year. | 26:19 | |
We have not had a recession anywhere near | 26:21 | |
as bad as that of 57-58. | 26:27 | |
It doesn't look as if we will. | 26:32 | |
They haven't made so large an error | 26:37 | |
that it's outside the ballpark, | 26:39 | |
that if you had absolute confidence in them, | 26:41 | |
that this error would cause you to now reject them. | 26:44 | |
But if you had a good deal of skepticism | 26:52 | |
about the approach, it seems to me | 26:54 | |
that this last year could only add to that skepticism. | 26:57 | |
I have not met anyone on the fence | 27:01 | |
with whom I've talked on this subject | 27:05 | |
who has been pushed other than a little bit | 27:07 | |
away from the monetarists' view, | 27:10 | |
the strong monetarists' view by events of the last year. | 27:15 | |
Well, nevertheless, since economists | 27:19 | |
at the beginning of the year make estimates | 27:21 | |
that go all the way across the spectrum, | 27:23 | |
somebody has got to be right. | 27:26 | |
And the Wharton School is having a pretty good year now | 27:28 | |
you might say at long last. | 27:34 | |
And it's quite interesting | 27:37 | |
that the Federal Reserve Bank of St. Louis, | 27:38 | |
which uses an entirely different methodology | 27:40 | |
from the Wharton School | 27:42 | |
but its forecast has to be somewhere | 27:44 | |
and their somewhere happens to be about | 27:46 | |
almost quarter for quarter | 27:49 | |
where the Wharton School forecast is. | 27:51 | |
This is not a year for crucial experiment, | 27:53 | |
and they have been pretty much right. | 27:55 | |
My time is just about up. | 27:58 | |
I think that there is a moral to be given here. | 27:59 | |
As I put it in the London Financial Times, | 28:03 | |
quoting Dr. Samuel Johnson, | 28:05 | |
he said of a man who was about to be hung, | 28:07 | |
"You may be sure of it that | 28:09 | |
"being hung in the morning clears the mind remarkably." | 28:11 | |
I think that it will clear the monetarists' mind | 28:15 | |
if they will make detailed numerical forecasts. | 28:17 | |
I think the Federal Reserve Bank of St. Louis | 28:20 | |
looks pretty good among monetarists | 28:23 | |
precisely because it has had to | 28:26 | |
toe up to the line and make the forecast, | 28:28 | |
although I really wouldn't criticize anybody | 28:32 | |
if you said that's not my cup of tea | 28:33 | |
and I just won't do that sort of the thing. | 28:35 | |
- | If you have any questions or comments | 28:38 |
for Professor Samuelson, address them in care of | 28:39 | |
Instructional Dynamics Incorporated, | 28:42 | |
166 East Superior Street, Chicago, Illinois, 60611. | 28:44 |
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