Krugman: Stay the Course on Economic Boosts

Kid Dynamite submits: Fear not, Helicopter Ben's soothing prose will act as a policy tool. Courtesy of Clusterstock comes Ben Bernanke explaining that he is not in fact "out of bullets" in terms of monetary policy: We have not fully done that review and we need to think about possibilities.

The Japan Story: Dean Baker is annoyed at Robert Samuelson, not for the first time, and with reason. The idea of invoking Japan, of all places, to justify fears that stimulus leads to inflation or asset bubbles is just bizarre….

Here's a summary of my points from tonight's RTE Frontline discussion. Note: these are not exaclty written up as an article, so treat them as working notes.

Here are some questions I'm thinking about ... 1) US Policy: This is probably the biggest downside risk for the US economy in 2013. I assume some sort of fiscal agreement will be reached soon, but how much austerity will be included? What will happen with the Alternative Minimum Tax (AMT)? What about emergency unemployment benefits? What about extending the mortgage relief for debt forgiveness (important for short sales)?

IT ISN'T too difficult to find praise for Mario Draghi these days, and, indeed, those economies whose primary exposure to Europe's troubles is via financial market jitters are quite happy that he seems (for the moment anyway) to have done a very nice job propping up European banks. Britain and central Europe may be still be sweating, but other big economies are doing much better than they were in December, thank you.

The old cliches stick around for a reason. “Don’t fight the Fed” is back on trader’s lips after yesterday’s policy driven rally. On Wednesday the Fed revealed plans to keep interest rates near zero well into 2014, and refused to rule out more bond purchases.