Is Europe’s Central Bank Finally Getting Worried About Deflation?

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Brad DeLong notes that Mario Draghi, the head of Europe’s central bank, went off text in his speech at Jackson Hole. Here’s his summary of Draghi’s extended ad-lib:

The speech text says:

  1. The ECB knows that inflation has declined.
  2. The decline in inflation has not led to any decline in expectations of inflation.
  3. THE ECB will, if necessary, within its mandate, use QE and other policies to keep expectations of inflation from declining.

The speech as delivered says:

  1. The ECB knows that inflation has declined.
  2. My usual line is that the decline in inflation is due to temporary factors that will be reversed.
  3. That explanation is now long in the tooth: the longer “temporary” lasts the greater the danger.
  4. In fact, it is too late to “safeguard the firm anchoring of inflation expectations”.
  5. Inflationary expectations have already declined.
  6. We will use all the tools we have to reverse this.

Is this deviation a mere line wobble….Is this deviation an audience effect….Or does it signal a recognition on Draghi’s part that the Eurozone is heading for a triple dip, and that if he doesn’t assemble a coalition to do much more very quickly to boost aggregate demand we will have to change the name “The Great Recession” to something including the D-word, and he will go down in history as the worst central banker since the 1930s?

I would like to know…

I suppose we’d all like to know. The Germans better start taking this stuff seriously pretty soon. They can’t stick their heads in the sand and live in the past forever.

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WHO DOESN’T LOVE A POSITIVE STORY—OR TWO?

“Great journalism really does make a difference in this world: it can even save kids.”

That’s what a civil rights lawyer wrote to Julia Lurie, the day after her major investigation into a psychiatric hospital chain that uses foster children as “cash cows” published, letting her know he was using her findings that same day in a hearing to keep a child out of one of the facilities we investigated.

That’s awesome. As is the fact that Julia, who spent a full year reporting this challenging story, promptly heard from a Senate committee that will use her work in their own investigation of Universal Health Services. There’s no doubt her revelations will continue to have a big impact in the months and years to come.

Like another story about Mother Jones’ real-world impact.

This one, a multiyear investigation, published in 2021, exposed conditions in sugar work camps in the Dominican Republic owned by Central Romana—the conglomerate behind brands like C&H and Domino, whose product ends up in our Hershey bars and other sweets. A year ago, the Biden administration banned sugar imports from Central Romana. And just recently, we learned of a previously undisclosed investigation from the Department of Homeland Security, looking into working conditions at Central Romana. How big of a deal is this?

“This could be the first time a corporation would be held criminally liable for forced labor in their own supply chains,” according to a retired special agent we talked to.

Wow.

And it is only because Mother Jones is funded primarily by donations from readers that we can mount ambitious, yearlong—or more—investigations like these two stories that are making waves.

About that: It’s unfathomably hard in the news business right now, and we came up about $28,000 short during our recent fall fundraising campaign. We simply have to make that up soon to avoid falling further behind than can be made up for, or needing to somehow trim $1 million from our budget, like happened last year.

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