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Overstimulated

By The Daily Dish

Feb 4 2008, 8:07 AM ET

Greg Mankiw on the inflation-protected bond market:

A rise in expected inflation is not consistent with the conventional wisdom that the economy is on the verge of a serious slump driven by inadequate aggregate demand. It is, however, consistent with the hypothesis that policymakers are overreacting to some bad economic news with excessive monetary and fiscal stimulus.



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