Ironsides Macro

Academic note: I have tried to be serious as a scholar, teacher and colleague since 1980s. In doing so I have constantly searched for productivity hacks — things that enable me to be more effective at being serious. Little things, like finding the right time of day to do research and to do teaching, or seeking ways to absorb needed knowledge like lectures at Great Courses or New York Review of Books or TLS. I moved from Word Perfect to Word, I have tried Palm Pilot, Blackberry, iPhone, I had a luggable portable computer that I traded in for laptop, and I used computer programs to take notes but switched back to notebooks and pen, and now use Kindle Scribe rather than ReMarkable. I try, I experiment, I assess. I read books in physical form, electronic form and audio. I watch YouTube and listen to podcasts all to help with lectures and papers. I used to search physically in libraries now I search online. My point is simple — I have always looked for ways to augment my skills and improve productivity. AI and LLMs are NO different in my experience. They don’t think for me, but they help speed up search and information gathering. I still have to exercise judgment, absorb what I need, and execute in a lecture, in writing, or in meetings with students and colleagues. The best productivity hack in my career is face to face dialogue with PhD students about ideas. These conversations are infinitely more interesting to me than me prompting Chat or Claude about material. Even working with a student on a difficult problem or struggling to understand concepts is more intellectually rewarding. Maybe I am doing it wrong, or maybe everyone else is describing their experience wrong. Modern AI is not the Palm Pilot, nor early versions of Netscape Browser (BTW, Browzine is a good hack for journal article access). But its not like having Kenneth Boulding, James Buchanan or Gordon Tullock as a teacher either! Its not like having been mentored by Don Lavoie and Karen Vaughn, or first inspired by Hans Sennholz, or arguing about economics 24/7 with Dave Prychitko and Steve Horwitz, let alone working closely with Israel Kirzner and Mario Rizzo for almost a decade, or teaching and learning from scores of PhD advisees at GMU. It just isn’t. Don’t buy the false narrative. It is not a substitute, it is a tool. You need to learn how to use the tool effectively to increase YOUR productivity as a scholar, teacher, and colleague. So invest in it, but at the end of the day you will have to be the one who uses the tool effectively or poorly. YOU, not the machine make the final judgement call.

This week, I hosted my annual Daily Dirtnap conference in Nashville. About 140 people were in attendance, with some of the brightest minds in finance as presenters. And a party at Nashville's greatest underground club! Everything about it was perfect. And thanks to all those who helped with the details so I could focus on the content. We'll be doing it again next year. Thanks to speakers: @TgMacro, @EricBalchunas, @barryknapp, @VD718, @Seawolfcap, @JanvanEck3, @CultishCreative, @MebFaber, @cafreiman, @pboockvar, Mark Lapolla, John Burns, and Marcin Zdunek. If you want to come to the best financial conference on earth, you must be a subscriber to The Daily Dirtnap. DM me for details (and a discount).

Debate on cause of rise of the long term bond yields: Two models, both produced by economists affiliated with the Fed: 1) ACM (it’s all real yields/growth/ppl expect Fed to hike) 2) KM (it is term premium) Warsh picked the former interpretation. As did the rest of the FOMC, implied in the SEP More than a year ago, debate on whether tariffs would generate persistent vs transitory inflation: Two models also from Fed affiliated economists: 1) tariffs generate persistent inflation (new research) 2) tariffs deflationary in the long term, and initially a one off price change (from a long standing structural model that proved to be correct in 2018) The FOMC adopted the first interpretation, until facts showed otherwise today. Tell me that economics is not a dismal science. At least the Fed should debate about this, disagree. That is not what the SEP show. Group think is rearing its ugly head inside the Fed again.

If Fed embarks on additional rate hikes, that'd be a 'massive policy mistake': Economist cnb.cx/4iEO8Ta