Researchers Finally Replicated Reinhart-Rogoff, and There Are Serious Problems

One of the mistakes is thinking that Economics is in a fact a science. It is not.

Second, I think it is only right that economic decisions that influenced the lives of millions should be based on political principles, and not technical ones. The latter only give you things like the long-term suicidal one-child policy, and you also don't get anyone to blame, while the first at least give you the chance to change course mid-way and a sort of feedback mechanism.

Also, using 50-year cycles in order to determine long term economic "truths" is a joke.

This paper wasn't even peer reviewed so I don't understand why it was considered gospel in the first place.

Sometimes people will distinguish between "replicating a result" and "reproducing an experiment" – with the differences more prominent when you are dealing with straight data. Replicating a result simply means you confirm that the results aren't made up – you start with what they say they started with, you get the result they say. Reproducing an experiment might mean working from their conclusions, not trying to repeat every detail, and seeing if you come up with the same result – you might not if you mess up the experiment, but you might also confirm the interpretation of the result because you've eliminated aspects that the theory considers insignificant.

With results derived strictly from data this is a clearer line, as repeating the process exactly is quite possible (the spreadsheet in this case is the "process"). This might seem trivial, but it's pretty common that even repeating the purported process is very hard.

From a techy point of view this post helped me see the distinction: http://ivory.idyll.org/blog/replication-i.html

Yea, I was quite confused by the word replicate here. I thought it specifically meant the results in the original were valid.

It is news. The three criticisms the article raises are new and depend on their having gotten access to the spreadsheet.

Even though the author implies at the end that the Excel error is the least of the three, it's the perfect soundbite for a debate which, as you say, is political. Anyone can understand it (hey! I've made a mistake like that, those guys are as dumb as me) and in the symbolic language that governs such battles it's far more lethal than any substantive criticism could be [1]. Political hammer for a political nail.

[1] Such as Dean Baker in 2010 pointing out Rogoff and Reinhart's refusal to share their data: http://www.cepr.net/index.php/blogs/beat-the-press/not-follo....

You don't know it was intentional.

Money is being printed depending upon your definition of money. When the treasury spends in excess of tax revenues which is essentially all the time, by law they must issue a treasury security and "sell" it. This security gets sold to the primary dealer ( think big Wall Street firms). Treasury then gets account credited at Fed in the amount of security sale. Treasury then spends the money back into the economy. This "money" is called reserve balance ( federal funds/vertical money/high powered money). Since the Fed's job is to execute monetary policy ( i.e. price of money) by directly manipulating the federal funds rate, they often buy back that treasury bond from the primary dealer and remove the excess reserves else they lose grasp of the federal funds rate. Would be nice to get rid of this obfuscated gymnastics between Fed, Treasury, and Wall Street, and simply have direct printing of money as per congressional budgets passed by Congress. The current system causes mucho confusion and the illusion that the government is self funded. How can issuer of a fiat currency be involuntarily insolvent?

edit: With direct printing, the fed funds rate would go to zero. No need for Treasury Bonds or "borrowing" per se.