Updating Scott Sumner´s chart

In discussing claims by Tyler Cowen, Scott Sumner writes:

However I take issue with this claim:

  1. During the upward phase of the recovery, monetary policy just doesn’t matter that much.

I can’t even imagine what a model would look like where that claim was true.  To see why it is not true, compare the post mid-2009 recoveries in the US and Europe. If monetary policy in the US and Europe did not matter very much during the recovery, then the tightening of monetary policy in mid-2011 in the eurozone ought to have had little effect.  What does it look like to you?

(The updated chart follows.) It is very compelling evidence against Tyler´s claim:

SS-Eur-US

One thought on “Updating Scott Sumner´s chart

  1. Pingback: TheMoneyIllusion » The dog that did not bark

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s