YouSaid · the spoken record

Kenneth Rogoff

lines on the record: 73
first: 2025-04-30
most recent: 2025-04-30
sittings or episodes: 1
sources: podcast

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“It is a very society which obviously has a very high degree of cohesion, and that's a tremendous strength of Japan. I just have a side mention, if I can. I mean, I was a visitor at the Bank of Japan in the early 90s in the middle of their meltdown, although I didn't see it, and I don't think anyone did at the time. And I had to eat at the cafeteria every day and they had almost the same food that you had to eat. And it was good. And then I saw another line once, and I asked, can I go in that line? And the people said, oh, well, that's if you want a smaller portion. I mean, it's a very different society than we have. But they have a lot of financial repression. Financial repression is going to be part of the solution in every advanced country where you force banks, insurance companies, pension funds to hold.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“Oh, but you can. Yeah, that's fair, but they've fallen behind France, the UK, Germany. They were ahead of all them. They've fallen far behind. And they're in trouble now because they're finally having inflation. They're needing to raise interest rates. They've stuffed government debt into every orifice of the economy, into the pension systems, into the banks, into their postal savings system. And now they're talking about cutting pensions, cutting old age benefits because suddenly they're having to make interest payments on the debt. And it's harder. So I think people who use Japan as an example of everything's fine, you know, have their head in the sand. I mean, it's an example of if you're very rich, you can go down slowly, but it's not an example. Of how you can have fantastic economy with doubt like that.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“And since then, well, have they hung on? In 1990 and even in the early 90s, their per capita GDP was 80% of the United States and purchasing power parity measures, trying to put into common price level. But in dollars, it was well over 100% of the U.S. today, it's 60% in those measures. I mean, it is not held on in per capita terms. It has just not had growth for a long time. And they're running into trouble.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“Okay, I'm being naive, but is there an insurer who's going to bail out the Barbados? I mean, I think our regulators would make that difficult. Their regulators would make it difficult. I mean, you would need to have something like that. And there's a lot of moral hazards. So you really, if you're going to be an insurer, you can't just insure. You have to have, you know, 150 people on sure looking at them all the time. I mean, it's not easy to do. The only country in the world, really, which can bail out its banking system is Hong Kong. They have enough dollar reserves to bail out everything. But that's the problem with dollarization is that if you're not going to have banks, it's great, but we want to have lending and mortgages and car loans and stuff. And it's very easy to run into trouble.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, you can do it. I mean, it has its costs. The biggest cost is if your banking system runs into trouble, you can't bail them out. So in most countries, the currency that we think of the physical currency is just like a little piece of the animal. A lot of it, you know, you might not think of your checking account or your savings account as dollars, but they are. That's a lot of the money supply. So when you say they're just using real dollars, they don't have real dollars to back those bank accounts. So it can work, but you run into banking crises. You run into debt crises. And then when you're dollarized, it's hard to fight it. So it's doable. It's absolutely doable. But I'm not sure necessarily it's advisable. It depends on the alternative. If the country's been run into the ground for 50 years and you're trying to reclaim”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, it's a pretty desperate measure when you dollarize, and there are different ways to dollarize. When I just came into the International Monetary Fund in 2001, Argentina had dollarized. They had been dollarized for 10 years. And they said, you know, isn't this great?”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“All the time. And it's very sensitive politically. Pakistan's a country that's very, very geopolitically important. So you can't look at the programs there as if you're lending to the UK. It's something very different. And the amounts are small compared to if you're lending to the UK. But frankly, what I have advised on things like Pakistan is just give them aid. Don't give loans. You're never going to collect the loans. You're not seriously meeting their loans. And so it sounds great to say, well, we just lent the money to Pakistan. But I think in general, in money we're giving to developing countries too much of it comes in the form of loans. And it distorts what we do because we don't get them all repaid.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, first of all, if you don't sign off on bailout number 25, they're going to default on bailout number 24. You're rolling over the stebt.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“That's the deep seated problems, the military is very, very powerful in the country. The military is very corrupt, runs a lot of the businesses, has a lot of control. So, I mean, it really runs deep into the institutions in the country. It's not something you can airlift some expert like you or I and just tell them what to do. I mean, believe me, there are a lot of very smart Pakistani economists who know what to do.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“As you may know, I mean, I think my first important paper was showing how hard it was to explain exchange rates. I'm embarrassed to say it's like 45 years ago. And I think the policy conclusions people drew out of that is look at the exchange rate when you're trying to figure out what policy should be. Look at inflation rate. Look at output. I think for some countries, they're so deep into dollar debt. They're so connected with the dollar and trade, they do worry about their exchange rate. So it sort of depends on if you're talking about a big country like the United States, or are you talking about New Zealand or something like that? But I mean, I think generally policymakers need to recognize there's a lot of noise. So trying to target the exchange rate is a fool's game. And if the Trump administration is trying to do it, they might get lucky.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, part of it is if you have floating exchange rates, there's a lot of financial factors that are hard to understand that move it around a lot. We're not able to easily identify those factors, but I think more and more theory empirics is coalesced around things like bank balance sheets. So can banks arbitrage exchange rates and various pricing imperfections? So I think the weight of research the past 10 or 15 years has been that the exchange rate moves a lot, but it's not silly moving around the economy with it. And we thought that for a long time, but I think the general view today, I mean, it isn't always true, but that a lot of the movements have to do with financial frictions and financial factors, not some gnomes controlling the exchange rate, that there's a lot of Lot of random noise.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, they're running a massive surplus to the rest of the world. The total size of their trade bound surplus is only 2% of GDP. It's not like 10% the way it was in 2010, but they've gotten a lot bigger. It's still huge compared to the world. So, I mean, in crude measures of if their exchange rate's overvalued and undervalued, I don't think you come to a simple answer. The dollar is very rich. I mean, so in a sense, everybody seems cheap to the dollar right now. I'm sure you've experienced that with anyone coming from abroad, even from Japan or Switzerland, oh my gosh, it's so expensive here.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean, a logical way to do it would be to do more expansionary fiscal policy, more expansionary monetary policy. We don't really try to deal with producer price inflation through the exchange rate. I mean, exports and imports are important to China, but it's also a very big economy. There's a lot of stuff And other investment that's internal”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“They have a lot of distortions in their economy, but the days when it was very clear cut that they had an overvalued currency. I mean, or far gone.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“And so, you know, that rebalances everything, that brings the cost of their goods back to just a 10% rise. And it makes your exports 10% more expensive because the currency appreciated. So that's definitely an effect. Of course, they're probably going to retaliate. And then that cancels it out.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“I can call wonky with you. Absolutely. Well, you did a 20% tariff on the whole world to a first approximation, your exchange rate goes up 10%, the dollar.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, what you said is exactly right. I mean, so to a first approximation, if we put on a, I don't know, whatever it is, a 20% tariff, it has an effect on our exchange rate of making it go up, which makes our exports more expensive and makes their goods less expensive. And I mean, I don't know, again, wonky, but if you did it on the whole world. You can get wonky.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“They do tell us that at the end of the day, you need to have innovation. If you're just growing by building more machines, by building more roads, you run into diminishing returns and you get less and less with the outfit. That's what happened to Russia. That's what happened to Japan. That's what happened to a lot of Asia. And for some reason, people thought that wouldn't happen to China. But their rate of innovation over the whole economy, I'm not talking about the highest level, has collapsed by many different measures. And the private sector is, of course, the root of all the innovation. They have oppressed the private sector, particularly in the last 10 years. And so, you know, for them to grow again, they need to restore some agency to the private sector.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“And that's for Chinese, where a lot of their wealth is. So I would say it's not a bad idea to try a little bit of that, but they've dug a very deep hole. It's not easy to dig their way out.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“First of all, they subsidize investment like crazy. Of course. I mean, so investment's been 40% of GDP. Consumption, they're different measures. But, you know, 50% of GDP, maybe we're 70% of GDP by comparison. And it's been very imbalanced. It's for a command and control economy. And China's a hybrid economy. The central government plays a big role doing infrastructure investment, subsidizing real estate is easy to do. And they've been doing that for a long time. Their growth has been very imbalanced. So everybody's been telling them for years, why don't you build up your consumption? But it's been hard because they don't have medical care in your old age. They don't have social security in their old age. They had this one child policy for a long time. So, you know, there are a lot of reasons everyone's had to say it. And now their house prices are plummeting.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“So I think the current account deficit, that's a broader measure, the deficit, it's important. And if it's really large, you can probably bet that it might go down. But it's not something to try to wrestle to the ground.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, the trade balance depends a lot on your savings and your investment, these macroeconomic factors. If there's an underlying problem, and to be fair, when your trade deficits really negative, there often is, you know, it could be something. I think in the case of the United States, when it hit a real peak in the 2005 to 2007, I thought there was a problem. I must say I didn't know till very close to the event what was going on. We weren't regulating well. But yeah, I mean, I don't even know what their point is, to be honest. I mean, there's this mercantilist view. I want to collect all the gold in the world. You know, we want to be able to buy things. Back in the day, you used to have to hire an army or navy to help fight off invaders and such. But today, that's not so true.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source
“There's unsustainable debt. There's not particularly unsustainable trade deficit. I mean, there's good things about having a trade deficit, bad things, but it's a result of many factors. So, no, I wouldn't agree with PETS on that.”
2025-04-30 · Conversations with Tyler · Kenneth Rogoff on Monetary Moves, Fiscal Gambits, and Classical Chess · IDENTIFIED FROM THE TRANSCRIPT · source