Newswise — One day the markets are way, way down; the next day they’re back up again. So it has gone for Wall Street, which has seen one of its most volatile periods in years amid mixed signals about the direction of the U.S. economy. Two Florida State University economics professors who are nationally regarded for their expertise in such areas as macroeconomic theory and the economic analysis of public policy issues are available to provide context for the current situation, as well as an informed look toward what might come next. • Milton H. Marquis, professor of economics: (850) 645-1526; [email protected]
Marquis’ principal areas of research are monetary and macroeconomic theory and policy. He has authored two textbooks on monetary theory and policy and the financial markets. In addition to his career in academia, Marquis has worked for the Federal Reserve in Washington (1993-1995) and San Francisco (2000-2003), where he was primarily responsible for monitoring developments in the financial markets and providing briefings to policymakers. He can discuss the concerns leading to market volatility, the possible consequences for the economy, and what, if anything, policymakers should make of it all:
“There is a great deal of uncertainty over how the Western industrialized economies will deleverage their massive indebtedness,” Marquis said. “Banks still have a lot of bad real estate-related debt on the books; consumers have high levels of personal debt, with weakness in their two primary sources of wealth — housing and the stock market — and uncertain job prospects; and many governments have run up against their ability to borrow to provide more fiscal stimulus to their economies, and are actually turning toward fiscal austerity. The monetary authorities are also running low on ‘ammunition’ to fight the slowdown. Reasonable economic forecasts range from a brief ‘double dip’ to a long period of slow growth with unemployment remaining high by historic standards.”
• Randall G. Holcombe, FSU’s DeVoe Moore Professor of Economics: (850) 644-7095; [email protected] (available Aug. 16-Sept. 5, and from Sept. 8 onward)
Holcombe’s areas of specialization are public finance and the economic analysis of public policy issues. He is the author of 12 books and more than 100 articles in academic and professional journals. Holcombe also served as a member of Florida Gov. Jeb Bush’s Council of Economic Advisors from 2000 to 2006:
“The volatility in the stock market reflects uncertainty in the economic outlook, largely as a result of uncertainties in government policy,” Holcombe said. “Everyone can see that our current policies are unsustainable, that we have to get our deficit under control, and that this will require changes to federal government entitlement programs. The problem is, there are no clear policy solutions on the table, and we run the risk of letting things go until we reach the point where Greece is now. But when we do, Germany won’t be there to bail us out.”
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