Tulip pops RBA bubble: “Disfunctional, hostile” to “public interest”

Via an FOI comes Peter Tulip’s incendiary final remarks at the RBA:

Farewell Remarks

There are two sides to central banking. There is a useful function, such as setting interest rates, where if we do it well people are better off.

And there is a ceremonial function such as conferences, hosting international visitors, large parts of the SMP and many other things I won’t mention, where we do it to be polite, for a warm inner glow or because we’ve always done it.

Farewell speeches are definitely in the latter category – the ceremonial function. But I have always hated that side of work. It always annoys me when people leave and they don’t explain why. So I will try to explain. I am sorry to disappoint those who were hoping for something more gracious and ceremonial.

The RBA has an unusually strong sense of community and loyalty. There is a downside to that, but it also means that leaving is an occasion of sadness and regret, which I feel strongly. I will miss many close friends and colleagues that I respect. The following comments should be interpreted in that context.

My time at the Bank has been mixed. Some things have been great and some things have been bad.

I will mention the frustrations first, because they explain why I’m going.

Like most of you, I want a career where I serve the public interest. My main reason for leaving is that I no longer believe the RBA does that. It isn’t just that I disagree; its more fundamental. I think the decisions are bad because the processes are bad. There is little deliberation. Opposing views are not taken into account. Decision makers seem hostile to a consideration of evidence or research.

The Bank says that the disagreements it has with mainstream macroeconomics are differences of judgement. If that were so then the Bank would explain its position explicitly and in detail, addressing obvious counter-arguments. It doesn’t. Perhaps because it knows its arguments are contradicted by the evidence. Our disagreements over the zero bound or financial stability reflect “judgement” in the way that disagreements over climate change, the health effects of tobacco, or vaccination reflect judgement. It would be more accurate to say that one side respects the research while the other side believes what it wants to believe.

I am most frustrated by the Bank’s reluctance to be honest and open. The Bank says things about the effect of policy on confidence, the likelihood of the zero bound, the effectiveness of policy, the effect of interest rates on financial instability, the effects of negative interest rates and so on that are contradicted by internal and external research. But we don’t even acknowledge that, let alone respond to it.

I recognise that these problems are not the Bank’s fault. We have a Board that does not understand monetary policy or statistical research. FOI legislation greatly stifles policy deliberation. The media misreport us. The public criticise errors of commission and ignore errors of omission.

So although there are lots of great people at the Bank, our environment makes the organisation dysfunctional.

Whatever the reason, I do not belong here.

That said, there are also big parts of my job that I loved and will miss. In particular, writing RDPs – where I felt the RBA made major contributions to public discussion. In this I was blessed with great co-authors. I was given the opportunity to work on some very interesting questions and I am grateful for that.

And I’ve enjoyed working with my immediate colleagues, in particular and the rest of the Research Department, whom I respect and am impressed by.

Thanks for providing a captive audience for this rare opportunity to vent. Even though I’m cutting my ties to the organisation, I hope we can remain in close contact at a personal level. Please keep in touch.

Bravo. The only media to even report this so far? Bloomberg. Why? Because the RBA manipulates the media via access journalism. It has become a rent-seeker itself – seeking to preserve inflated staffing, salaries and investment in property – within the great rent-seeker economy. Journalists are wither too dumb or corrupt to change it.

In short, the failure to report these remarks illustrates their veracity. I can’t wait for the RBA to begin leaking to its captured media whores snippets about what is wrong with Mr Tulip.

RBA reform is now a question of vital national interest. The bank’s forecasting record is a laughing stock. It is permanently behind the unconventional policy curve. It lives only to defend its housing bubble while ignoring its mandate for stable inflation and full employment. The most critical monetary tools to compete in the modern central bank universe are fatally divided between itself and APRA, compromised by internecine goals and ambitions.

Sack Deflation Phil. Slam RBA and APRA back together. Put an outsider who understands the bank’s role in currency settings in charge and burn the deadwood.

David Llewellyn-Smith
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Comments

      • IPA can also be Institute of Public Accountants

        He’s actually moving to the “Centre for Independent Studies” which is an “Australian libertarian think tank founded in 1976 and specialises in public policy research. It is based in Sydney and focuses on classical liberal issues such as free markets and limited government.”

        So yeah, RWNJ. Why are we listening to anthing this bozo says?

        • Why are we listening to anthing this bozo says

          To learn from him.
          I’ve found that there is something I can learn from every person I meet. Even nutters on the Internet like you can sometimes teach me a thing or two.

          • Just another case of a politician or senior bureaucrat having a road to Damascus moment when their pay packet is no longer at stake.

          • Even nutters on the Internet like you can sometimes teach me a thing or two.

            I’m glad you’re learning from a nutter like me. Unfortunately I cannot say the same about you, a nutter who monomaniacally pushed a “housing shortage” line for years, despite clear evidence to the contrary. Cheers.

          • revert2mean, I’m still pushing the housing shortage explanation.
            The clear evidence is in high rents. Also the huge difference in price between land WITH permission to build and land WITHOUT permission to build.
            The housing shortage is much more obvious than that global warming stuff you keep pushing.

      • No, he’s just a typical sane economist, paid lots to say stuff to enrich rich people and impoverish poor people.

        You can’t fault his colossal hypocrisy. At RBA, on Lowe’s orders, he led the charge to blame world-beating Sydney and Melbourne house prices on “zoning restrictions”, and nothing to do with mass migration.

        • Clearly it is a combination of the two
          Rezoning (et al) is not fast enough to cope with the immigration = shortage
          shortage + excessive lending = high prices.

      • The good news with Peter’s departure is that I can now safely throw away all of those overly mathy economics text books from University of Pennsylvania. These are the sort of books that you read once, just to prove its not beyond your comprehension, and then pray that no one ever asks any pointed questions about them.

  1. A guy named tulip is fighting the good fight?? Let it never be said that the god’s don’t have a sense of humour.

    On a somber note I don’t reckon anything will change with the RBA. Smart politicians will work out the RBA is the perfect scapegoat to blame the bust on, and wait for it to all go pearshaped.

    Once the public is baying for blood, the reasonable thing to do is put in a better framework to manage black swans, like covid don’t you know, and use the opportunity to take control of the RBA.

    Good I reckon. Not a fan of unelected/conflicted folks shadow running our economy!

    Also happily, reckon the RBA has worked out there is a giant bullseye on its rear, and will start playing politics more aggressively. This will lead to more elite infighting 🙂 🙂

    Excellent.

      • billygoatMEMBER

        Yep the Sons Of Mary always have a scapegoat (willing or not) at the ready to flesh out the endless corruption narratives:)) Throw them under a bus..few days/weeks of MSM scandal then quietly move on to another gig in the shadows – or not. Wheel Of Fortune..for some:))

  2. Economic instruments have been weaponized. There is a common theoretical position in international relations that modern western democracies do not go to war with each other – and its mainly true. The basis for this idea is that there is far too much economic cost involved as we discovered with the second world war. Again true. (Also why the path to ending conflicts in emerging world is always development – not more war).

    This theory however fails to grasp that like the Cold War – the Third World War – as its known shifted from a hot war, the world also shifted from tanks and bullets to instruments of economic warfare. Also known as soft power to some degree (color revolutions etc).

    The weapons of war are now currency, ratings, inter-bank transfers being used as trade sanctions, quantative easing, interest rates, stimulus (particularly military – you can pump as much “printed” money into your own economy via the military as you want – think sanctioned MMT).

    Finally its also worth nothing all western countries have what are known as powers of state secret. These are powers the government has to protect the country which are secret (state secrets act) – and eve acknowledging them or revealing their existence is a jailable offense.

    Many of these involve the media, detaining people, surveillance, etc but they also involve protecting our sovereignty and state via economic tools.

    Our system of economics has been weaponised and we are in a strong mutual alliance with our traditional allies and western countries. Tulip was just never given the inside info.

    Don’t fight the fed – its the most powerful arm of the U.S Military.

  3. Let’s get one thing straight.

    Tulip’s criticisms of the RBA appear to be centred around his belief that what the RBA should be doing is more of the same just a lot more of it.

    That is consistent with the support he is getting from the right wing finance / banking crowd who reckon the RBA should be using the power to create money (expand the RBA balance sheet) to buy loads more assets from rich people for higher prices.

    That is all that nonsense about operation twist, QE, TTF, CLF, yadda yadda boils down to.

    Making rich people, and those who bankers consider creditworthy, richer by inflating the value of the assets they own.

    Of course he is going to the IPA.

    Would be nice if once in a while some real reform of the RBA was supported rather than moving the deck chairs.

    For example.

    1. End the bank monopoly of 100% risk free deposit accounts at the RBA.

    2. Democratic public money creation rather than money creation for middle class “credit worthy” types

    3. Regulation of predatory international unproductive capital flows.

    https://theglass-pyramid.com/2020/09/09/covid-19-the-perfect-time-for-trickle-up-economics-and-myrba/

    • pfh007.comMEMBER

      And by the way.

      The support over the weekend for Tulip because he reckons the RBA should be pushing interest to ZIRP or NIRP and inflation or otherwise pursuing trickledown economics (poor folks eating crumbs falling from the tables of those bankers deem credit worthy) is just more of the same except promoted by the ossified and decrepit left.

      If you want zero interest rates fine but the only legitimate zero interest rates are when the working classes are so stuffed full of savings in their MyRBA accounts that they drive rates to zero in their eagerness to find borrowers.

      Enjoy the weather.

      It is going to be 31 degrees in Parramatta today!

      • Enjoy the weather.

        It is going to be 31 degrees in Parramatta today!

        Down to Parra park to enjoy the fresh air and open spaces cop loads of death stares from the New Australians who resent the sight of an obviously 4th generation anglo daring to utilise public space in ‘their’ community.

        • pfh007.comMEMBER

          I find it all quite civil. Mostly I see loads of Lycra lads and lasses on bikes and Premier league cricket tragics playing endless games with lots of weary parents trying to keep kids entertained.

          But the pooch and I are usually in and gone by 7.00 am if I get as far as the park.

      • Pro negative interest rates… might not like a common sense view that they are fundamentally wrong prevailing. I don’t have much time for this guy.

        • Yep.

          The more I look at what he’s said the less clear I am about what his position/view is. Ignoring the composition of the board, what particular change does he want to see right now in monetary policy, which, if not implemented, is frustrating enough to leave?

    • The already wealthy bondholders benefit most from the racket of low inflation.

      Plus higher inflation will lead to higher interest rates via the Fisher effect.

      Plus high unemployment Makes inequality worse.

          • Because prior to Powell’s avg. inflation targeting CBs haven’t been trying to create inflation.
            They merely been avoiding outright deflation.
            Eg. Creating money to meet exploding money demand.

          • pfh007.comMEMBER

            So you keep telling us.

            But you haven’t explained how driving up the prices paid for the assets of rich people even further is going to make a difference. The RBA has been trying to drive the economy with that technique for the last two decades and it hasn’t worked and the chances of it now producing inflation (other than asset price inflation) are receding to zero.

            So if you are a fan of inflation you need money creation directly into the pockets of those at the bottom of the economic pyramid and not just hoping some of the credit creation you are pumping into the banks accounts of the top 30% ends up there.

            And the best way of doing that is via a larger RBA balance sheet distributed in a democratic and equitable manner.

            https://theglass-pyramid.com/2020/08/15/myrba-the-quick-guide-and-helpful-links/

          • Jim's Central Banking

            “Because prior to Powell’s avg. inflation targeting CBs haven’t been trying to create inflation.”

            Not really. They’ve always wanted inflation to a point. It’s just now they can’t get the amount they need to inflate away the debt overhang while sticking to traditional targets.

          • Its not like since Volcker that all problems could be solved by cramming down labour – wages due to taxation being thrown away [theft memes] and then topping off that self inflicted wound the currant crop of quasi monetarists administrating CBs confused persistent anemic deflation with success in fighting upper bound inflation.

            Its like Greece all over again …

          • Yes it increases their asset prices but it also reduces their returns. So for the already rich who are getting a passive yield they are worse off.

        • Jim's Central Banking

          Yep. And it’s going to keep happening. When places like MB are pushing for more of it, there’s no hope.

          And I fear the situation will need to get much worse before there is enough public anger for any government to care.

  4. GunnamattaMEMBER

    Bravo. The only media to even report this so far? Bloomberg. Why? Because the RBA manipulates the media via access journalism.

    I thought the medium of the information was important too. Late on Friday Eve, via Mchael Heath (Bloomberg). My guess would be that any Australian media based contact would have stashed the story. I would also guess that Heath was tipped off as to the content of the email by either Tulip himself or someone looking to add to public questioning of the current RBA strategy. That might potentially set the scene for more – particularly if the Government budget doesnt live up to RBA expectations and they find themselves facing even more meaningless policy

  5. Yep leaving because he can’t convince people that negative interest rates are a good thing based on some cherry picked evidence that seems to elude the common man. Good riddance.
    Now if only MB would employ some intellectual humility when it come to other topics, and give equal consideration to both thesis and antithesis.
    Nup, Global warming is a cow too sacred to be questioned. Let’s get into bed with Soros and the corrupt MSM without any scepticism whatsoever.
    Why? Because people are blinded by self righteousness.
    If you hate people you disagree with then you are a Hateful person.
    So I refuse to give up on you all and hope one day you will be open minded enough to ask questions for yourself.
    Like why Al Gore was the first carbon trading billionaire?
    Corruption as far as the eye can see, but people can’t see it past their ego.

    • You should never skip stones in a packed swimming pool – or your meds.

      Robert, in 1856 chemists discovered what were known as a class of gasses known as the Green House gasses. They had a heat trapping effect like a green house. 1856 champ.

      Do you seriously think that the properties of gasses are being made up in a conspiracy by scientists for 150 years ? Do you have any idea how off the charts crazy that is ?

      There is no difference between claiming that the green house effect of gasses is a conspiracy to claiming hydrogen is not explosive, chlorine is not toxic.

      It really, truly is the most bizarre mentality to simply deny the known properties of certain elements because – you simply don’t want it to be true.

      Staggering behavior really.

      • Humans make poor scientist, most of us use judgement before perception, become emotionally attached to our positions, and rely on people in positions authority to inform their position. To be a divergent thinker comes with a high price, separation from the safety of the herd. It’s easier to be led than to be a black sheep.
        As for greenhouse gases causing warming that is not in dispute. It’s always a question of how much. A doubling of CO2 causes 3.7w/m2 or 1.2 deg C of warming. The climate models amplify this to 14w/m2 with positive feedback while a chemist would assume negative feedback as a consequence on le chateliers principle. The main positive feedback used by climate scientists is water vapour positive feedback in the upper troposphere. The observations show negative feedback and decreasing water vapour. The theory of dangerous warming is therefore falsified by empirical evidence. It’s so simple that it’s overlooked, because people are so sure of their position that they don’t look. Groupthink and confirmation bias are all you need to get a clusterf#*k. No conspiracy theories required.
        It’s just humans being human. https://en.m.wikipedia.org/wiki/Climate_change_feedback

          • It’s easier to just accept we live in a post modernist world that resembles a cross between a brave new world and 1984.
            Debt serfs don’t care till they have an empty stomach. Climate scientists are a tribe that refuse to listen to critical analysis. The science is settled because their minds are closed. An actual scientist would recognize that violates falsification, but the age of empirical science is dead. Long live women studies etc.

          • desmodromicMEMBER

            Sorry Robert but I don’t buy any of that. The data is the data. If you have a better or different interpretation of the data, publish it.

          • Des looking at these posts on MB you will see that I have changed my mind. Please have a look at the data sets used by Dr. Christy last year that are referred to in the vid I posted, his data sets are pitted against the climate models which do not reflect empirical evidence. It seems to me that Robert is right. Then have a look at the pre-hockey stick graph as to the temperatures 1000 years ago, hotter than today. Disregard the Mann graph as he failed in his litigation against dr. Ball in the Canadian litigation here,https://climatechangedispatch.com/tim-ball-defeats-michael-mann-lawsuit/
            Dr Ball’s graph is to be preferred and represents the conventional wisdom
            If we survived 1000 years ago, we will survive today. Don’t take my word for it. Look into it yourself. As Dr Christy, says, his experiment is one that you can do.

          • https://www.skepticalscience.com/skeptic_John_Christy.htm
            https://skepticalscience.com/graphics.php?g=243
            (or with more exposition: https://www.theguardian.com/environment/climate-consensus-97-per-cent/2016/feb/19/republicans-favorite-climate-chart-has-some-serious-problems)

            Christie is a religious fundie Creationist, and believes that humans are incapable of changing Earth’s climate. This massively influences his research.

            A court ruling is, of course, hilariously irrelevant to science (“and yet, it moves”).

            As always, it has to be highlighted that there is probably not a field of science in human history more closely scrutinised than climate change, and the only arguments against the consensus that have persisted for pushing twenty years now, are from a shrinking pool of self-referencing contrarians (often without any relevant scientific background), and something-something-something-Al-Gore.

            Meanwhile, climate change models are repeatedly and consistently shown to be reliable.

          • desmodromicMEMBER

            fitzroy, the climate debate doesn’t hinge on Ball or Mann. They are just two individuals with different interpretations of the data. That one of them may have committed fraud doesn’t bring into doubt the interpretations of 1000s of working scientists. It is the data that matters and interpretations will evolve and change. You are of the view that human populations will survive based on the fact mankind has previously survived change in the climate system, and you point to 1000 years ago. I have no such confidence because the current rate of change is a threat to all ecological systems. 1000 years ago there was less that 300 million humans. 120 years ago there was less than 1.6 billion humans and Australia still had most of its tree cover, despite the efforts of the early settlers. 80 years ago Australia had experienced few mammal extinctions but now 30 species are gone and many more are threatened or critically endangered. The rate of change is unprecedented and we are now entering the Pyrocene. The rate of change will likely accelerate as positive feedbacks fan the flames. We know that logged native forests dry out, shed less water, and have a greater tendency to burn–adding to impacts on the climate system Yet we still log them to preserve a handful of jobs. We know that the polar climate systems are becoming unstable, yet we still cherry pick the data to find arguments to do nothing. Colonising Mars or geo-engineering the atmosphere isn’t going to change the fundamentals of our biology. ALL animal populations that experience exponential growth, crash. We can choose how we crash.

    • Dude… It seems like that because the global warming cultists keep yapping.

      Think about it this way – you know all the arguments about covid on mb? They pale in comparison to the arguments about global warming/climate change.

      Here’s the skinny. Yes the progressive cult is a standard share all resources and women cult – run by a priesthood, like so many in history. And global warming is their repent-the-end-is-nigh belief system. And God knows we mock them for it. The world generally is gearing up to excise them too. Much like de nazification, we are going to have to de-progressivize our institutions shortly.

      But… It is also true that there are enough humans around and our tech is fancy enough that we can cause global climate changes. Remember trees and amoeba created all the oxygen in the atmosphere, chances are we have the ability to cause changes on that scale too.

      Tldr, of course climate change is progs playing politics and virtue signalling. But pollution, and more generally, human caused climate volatility are absolutely real things.

      Be cool. And don’t take the lefties too seriously. No one else does.

      • T, the biggest lie in the whole climate debacle was Michael Mann rewriting history with his infamous hockey stick. He and Al Gore committed scientific fraud when they claimed the climate was stable before humans. They threw out thousands of peer reviewed studies documenting the history of earth highly variable climate with fake data and a novel statistical technique that produce an identical result from any data including random noise. He even used data upside down and continued to use it even after being found out. Humans certainly affect climate on a local level from land use changes and urban heat islands, but 2W/m2 forcing in 100 years is millions of times weaker than the 1300w/m2 difference that happens between noon and dusk.

  6. About 3 months ago I was talking to a friend that’s totally into the whole DGSE modelling thing. He was confused by RBA decisions because he believed his model to be correct and functionally identical to the internal model used by the RBA itself. Yet his models had shifted rapidly to a position that would require a strong NIRP response.
    Conclusion, The RBA was either ignoring its own research and modelling OR their model is broke…both equally worrying cases.
    I guess we now know which case it was, I’m sure my friend will be happy that his internal model is not out of step with the RBA’s own DGSE and Martin models.
    As an interesting exercise I’d like to find out how many of the Martin modelling team are no longer working for the RBA. I’ve got a strong suspicion that at least half the Martin team has left …what does that sort of churn tell you about internal organizational stress within the RBA? How many public service sectors see greater than 10% labour churn annually especially at the nerdy end of their business?
    Lots of questions for the RBA senior management especially given what written between the lines in Peter Tulip’s parting letter.

    The following paper provides a list of people associated with the development of the Martin model, would be interesting to see how many of them are still at the RBA.
    https://rba.gov.au/publications/rdp/2019/pdf/rdp2019-07.pdf

        • Cough ….

          The authors genuinely think that in deploying Bayes’ probability theorem to human decision-making they have constructed an approach for studying ‘animal spirits’. But of course the very paragraph where Keynes, who knew more than a little bit about the philosophy of probability, introduces the term states crystal clearly that ‘animal spirits’ is unrelated to probability estimates.

          Most, probably, of our decisions to do something positive, the full consequences of which will be drawn out over many days to come, can only be taken as a result of animal spirits — of a spontaneous urge to action rather than inaction, and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities. (My Emphasis)

          This is a very simple point indeed and one that the authors could easily have picked up from either the source itself or the literature that grew up from it. In Keynesian economics we do not assume (a) that certain aspects of the future are reducible to probability estimates, or (b) that people act in a manner in which they take various events in the future to be calculable in numerical probabilistic terms and then apply this to reality in the form of Bayes’ theorem. – snip

      • Yep, btw I agree with your post below.
        Macroeconomic management is counterintuitive for anyone with a Microeconomic or Business management background, especially if you take into account the modern day “weaponization” of Currency as pointed out above by Casus Belli

    • Interesting..

      4.3.2 Housing prices
      We model housing prices using an ECM similar to that in Fox and Tulip (2014). Housing prices are
      expected to tend towards their fundamental value, which is the price where households are
      indifferent between owning and renting. We assume that variation in the user cost of owning a home
      is driven by movements in the real mortgage interest rate.15 In the long run, if the real mortgage
      rate is constant, nominal housing prices will grow in line with rents. Like Fox and Tulip, we find that
      the rents–user cost framework can account for much of the growth in housing prices over recent
      decades (Figure 5).

    • GunnamattaMEMBER

      Only ten minutes googling but this is what i come up with

      Daniel Rees – BIS

      Gabriela Nodari –  RBA

      Rachael McCririck – RBA

      Elizabeth Kendall – ANZ

      Adam Hamilton – RBA

      Jonathan Hambur – Treasury

      Rochelle Guttmann – RBA

      Richard Evans – RBA

      Tom Cusbert – RBA

      Alexander Ballantyne – Uni Melbourne (PhD)

    • happy valleyMEMBER

      My bet would be most of them are still at the sheltered workshop that is the RBA because most of them would be unlikely to get a real job unless of course, you count being a bank economist churning out the bank view/demands as a real job? Still that can pay very well and that’s what’s life’s all about?

  7. The last remaining vestige of the Bretton Woods Agreement is in the process of disintegration as we speak, that is the counter-cyclical Keynesian economic process. From now on it will be stimulus most of the time in a shotgun approach as we lurch from one crisis to another.

    The central banks set up in the late 1950’s are no longer fit for purpose and the RBA is just one of many. This is the end of the 75 year cycle….two generations, nothing new in that. We will hang onto our US dollar swaps as long as we can because we have no other ideas.

    Icecap Global are thinking that Turkey will be canary in the coal mine for the next surge in King Dollar

    http://icecapassetmanagement.com/wp-content/uploads/2020/09/2020.10-IceCap-Global-Outlook.pdf

    • GunnamattaMEMBER

      I would be inclined to second that. The Turks are ready for the fork. Which may explain their actions in the Caucasus right now.

      But i think crude is not far off imploding too, and that usually triggers major financial system trauma.

  8. The biggest criticism of Tulip seems to be the makeup of the board.
    This problem took off with Costello where he stacked the board with business / finance types with no macro training. Previously it was economists, public servants and maybe trade union officials. Hawke and Kelty were both on the board.
    Since then we’ve had a heap of business types who see the position like it’s another order of chivalry.

    And they don’t get monetary policy. They just don’t.
    Business and finance is antithetical to monetary policy.
    Firstly they’ve spent their whole lives approving budgets worrying about the solvency of whichever silo they were in. Now they are asked to come in to a place where solvency and profit maximisation is irrelevant and all decisions need to be based on macroeconomic objectives.

    Then there’s the macroeconomic objectives.
    They don’t get them. Interest rates > zero may be good for the net interest margin of name a bank but right now it is terrible for the economy.
    High unemployment and low inflation may be good for the next EBA round in name a company, but it is terrible for the economy.

    Because they don’t know what they are doing or why they are doing it they follow rules of thumb.
    ie. low inflation = good
    Interest rates > zero = good
    But they don’t know why they are even targeting inflation.
    If they did they would see that low inflation where interest rates are zero and demand is permanently below potential output level is terrible.

    We are asking people who have spent their whole lives thinking in zero sum terms, where paradox of thrift actually works, who have always tried to reduce costs, so intrinsicallly dislike inflation, have zero macro training, to come into a place and forget everything they think know. Never going to work.

  9. happy valleyMEMBER

    I get the impression that Mr Tulip spent most of his years working at the insular, inbred ivory tower RBA writing research papers that went nowhere and were never destined to? Never has so much paper been wasted on so much, for so little? In the end, I guess some of them want or have to escape the refuge asylum for a less ordinary life? Ditto APRA and ASIC?

    • No reason to be so public if that was the case. I reckon he wants money and adulation (not that there is anything wrong with that) hence the move.

      Didn’t he get his 5 mins of fame about a year ago? Maybe he misses the limelight. His style strikes me as a loser gamma who will say and do anything for pats on the head from the rich and famous – basically a male status whore.

      If his new job involves media appearances we will know for sure.
      (Below in friendly jordies voice)
      Mr.Tulip, an ex RBA economist is here to tell us more about why the rich getting richer is good for you! Mr.Tulip…

      Why yes Leigh, it’s all simple when you consider the models….

  10. It was said that at the peak of the Great Australian Property bubble, the opinion of one Tulip was worth more than the research of the entire staff of the Reserve Bank of Australia.

  11. Can’t have the market setting rates now can we? We need a privately owned bank out of the City of London to print and lend our own currency to us at interest because reasons!

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