The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."

Monday, January 31, 2011

Uren on RBA Director Warwick McKibbin going thermo-nuclear

Two outstanding articles today by The Australian's David Uren, who is one of our most thoughtful economic commentators. The first is a brilliant piece on the RBA Director Warwick McKibbin, who has now gone public about his desire to serve another term (HT: Stephen Kirchner). I have previously covered this issue on several occasions here over the past few weeks. Reappointment is a must as far as I am concerned. Sure, Warwick is sometimes a little too aggressive in his communications, but that is a super small price to pay for his world-class expertise and highly-valued independence. While the Treasurer would presumably be most irritated by Warwick's criticisms, Warwick is right: we need as much solid public debate on policy as is possible, even if you don't agree with what he says. We also need much more independent economic horse-power on the RBA Board, as I have argued for a long time now. And I have proposed a solution for the Government's Ross Garnaut vs. McKibbin dilemma: appoint Garnaut as a replacement for McGauchie, when he retires in March, and keep McKibbin. That way you get more economic firepower combined with a likely more sympathetic economist in Garnaut. The second piece is a very good summary of the challenges facing the RBA's inflation forecasting models, and leverages off Matty Johnson's recent research.