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I agree! His simple-but-not-too-simple model to explain international macro economics is really great, and happens to explain a lot of the dynamics of what we s

I agree! His simple-but-not-too-simple model to explain international macro economics is really great, and happens to explain a lot of the dynamics of what we see these days. It's appealing intellectually; I like small and simple models. I suppose if we see a major dislocation in the Chinese economy in the next 2-3 years, his model will be extra-confirmed. (That's a major point he makes on his blog.)

int_19h 9y ago
Can you recommend a good starting point to read up on this?
- ryandamm 9y ago
  Well, I was introduced to Pettis via Paul Krugman's blog at the NYTimes... but in practice, you just gotta wade in. Be comfortable with being lost the first few tens of thousands of words on his blog, and it will add up. Pettis doesn't really give a primer; he discusses lots of different issues through the same lens, and his target audience appears to be readers with at least an undergraduate understanding of economics and a passing familiarity with balance sheets (I had neither). Frankly, I picked it up via muscle memory (and lots of context-Googling; Wikipedia helps, and StackOverflow has a surprising amount of basic economics info). I think the bottom line is this: if you're willing to devote a few hours (maybe low tens of hours) to slogging through his posts, occasionally re-reading them a few times and searching elsewhere for explanation of terms, you'll start to understand his balance-sheet theory of macro. And it doesn't require much context, to be honest: one of the beauties of his framework is it glosses over so much of the complexity of an economy by dealing with clear and clean abstractions at the national level. (It's only an okay source for understanding the internal dynamics of an economy; the blog really mostly focuses on international macro.) I hope that helps... though acknowledge it might not! (My interest was driven by a burning desire to understand WTF just happened!?! circa 2008; that motivation is probably hard to conjure without context, to be honest.)
- ryandamm 9y ago
  A little late, but Pettis obliged with his latest post. It's more directly answering your question, I think: https://news.ycombinator.com/item?id=14408165 https://news.ycombinator.com/item?id=14408165

int_19h 9y ago

Can you recommend a good starting point to read up on this?

ryandamm 9y ago
Well, I was introduced to Pettis via Paul Krugman's blog at the NYTimes... but in practice, you just gotta wade in. Be comfortable with being lost the first few tens of thousands of words on his blog, and it will add up. Pettis doesn't really give a primer; he discusses lots of different issues through the same lens, and his target audience appears to be readers with at least an undergraduate understanding of economics and a passing familiarity with balance sheets (I had neither). Frankly, I picked it up via muscle memory (and lots of context-Googling; Wikipedia helps, and StackOverflow has a surprising amount of basic economics info). I think the bottom line is this: if you're willing to devote a few hours (maybe low tens of hours) to slogging through his posts, occasionally re-reading them a few times and searching elsewhere for explanation of terms, you'll start to understand his balance-sheet theory of macro. And it doesn't require much context, to be honest: one of the beauties of his framework is it glosses over so much of the complexity of an economy by dealing with clear and clean abstractions at the national level. (It's only an okay source for understanding the internal dynamics of an economy; the blog really mostly focuses on international macro.) I hope that helps... though acknowledge it might not! (My interest was driven by a burning desire to understand WTF just happened!?! circa 2008; that motivation is probably hard to conjure without context, to be honest.)
ryandamm 9y ago
A little late, but Pettis obliged with his latest post. It's more directly answering your question, I think: https://news.ycombinator.com/item?id=14408165 https://news.ycombinator.com/item?id=14408165