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Kenneth Duda
Works at Arista Networks, Inc.
Attended Stanford University
Lives in Menlo Park, CA
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Kenneth Duda

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Very nice summary of the Greek crisis.
The true origins of the default crisis, the role of austerity, and the path forward.
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Michael Andresen's profile photoKenneth Duda's profile photoFriedrich Sinofzik's profile photoSergey Vasilyev's profile photo
7 comments
 
1- Yesm they can give them money but they will request grantees that Greece will pay it and will not need it again.
2- Separate currency today?
they don’t have money to pay their debts today that they have some sort of Europe back. Imagine from day to night they separate their money. From where they will find a way to turn their money valuable?
"...
Instead, they devalue their currency to regain export competitiveness.
..."
This is a myth. Print more money to later back this money with some sort of product when the state still  deficient and the industry is a joke just will put them inside the eternal circle of "we pay later"..
Believe me, I'm living in Brazil. I know in my daily life well how this circle works.
we had in 70/80/90 this each 2 years.

"...
What we have today is the monetary straitjacket (the Euro) so no devaluation is possible, along with a lack of fiscal union, so no fiscal transfers will happen either.  Something has to give.  What's left?
..."
What they have today is a populist government that doesn’t know what to do and is afraid of do what need to do. POLITICS.
Grecia is not solvent like argentina... they already have a reasonable internal incoming by they size.
They need to clean the state machine. Stop some crazy laws like "anticipation of retirement".. and turn they industry, tourism, agro business competitive. 

Hoo, but the population will pay the price.
YES, they will. in any way they will.
but better pay a price today and in future they understand that stability come with responsibility than each 2, 5, 10, 20 years the economy hight and low go and come back and they pay the same price each time.

I know it's stupid by comparison but still valid.
Look Germany. Doesn’t have natural resources any more, lives in the middle of Europe almost 100% without sea  trade exists or direct roads for the world.
Still have one or the biggest social cost in Europe and workers ones. Problems with energy all the time. but they are competitive. VERY COMPETITIVE.. How they do it?
Efficiency.

The solution now is the politics start to think in the Greece future nor in their next elections and the citizens understand that the way they live until today is not feasible any more. their problems today under the social and economic side are not result of FOREIGN intervation of CIA or the BIG BANKS from Germany trying to disrrupt them like some crazy people love to create. The condition they have now is exactly the condition of the country . The real wealth/money/production of the country.
Yes, inefficient = be poor

Of course, maybe tomorrow, the international marked change and they start to receive more speculative capital and the government start to print more money and everyone live happy for a time buying new houses, travelling around world, buy BMW, Mercedes, drinking the best from the best and eating just the best food and everyone smiling on street.
Again1 One day the money leaves the country and they will discover that they money doesn’t have the value they lived.. and that they yet need to pay what they buy before by the same value and without money..

Is not complex. The things there is POLITICS... DO THE HOME WORK...
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Kenneth Duda

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I got interviewed on TechTarget, about the programmability of my company's software.  I was pretty happy with how it came out.
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Nice! How "crazy" turned out to be a unique game-changing factor for Arista!
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Kenneth Duda

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Scott seems to like my ideas for things the Fed could actually reasonably do today to improve monetary policy --- modest improvements, but things that should be entirely within today's "Overton window".
A few weeks ago, I published a post discussing the minimum acceptable level of Fed accountability. At a minimum, any institution needs to establish some procedure to evaluate how they are doing their job. The Fed's main job is to use its policy instruments to nudge AD up or down in a way that ...
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Kenneth Duda

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James Bullard, president of the St Louis Fed, endorses NGDP level targeting.  This is kind of a big deal for monetary policy, very much in the right direction in my opinion.
We study optimal monetary policy at the zero lower bound. The macroeconomy we study has considerable income inequality which gives rise to a large private sector credit market. Households participating in this market use non-state contingent nominal contracts (NSCNC).
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Vytautas Vakrina's profile photo
 
Nes gi monetarinė politika puikiai veikia.
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Kenneth Duda

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Funny/insightful.
 
Once more, cracked.com knocks it out of the park. They write really amazing articles on a lot of things.

If you've ever wondered why people are "SJWs", and why people who care about social justice are always picking on white, hetero males even though quite a few of them don't have easy lives either, this would be a good article to read.

Helping to rectify that situation is one of the many, many things you're tasked with due to having been born in a fairly high place in the world. It's not "fair," but that's a meaningless word when referencing things you have no control over. You didn't ask to be born half-way up a mountain, but you were, and I need you to look down and realize that mountain is really a pile of bones.
What I am finding as time goes on is that we are all secretly Billy Joel.
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Kenneth Duda

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JP Koning wrote a really great explanation of how every investment includes a consumption component: liquidity.  You pay for liquidity.  Once you understand that, then you can understand how the US is a net exporter of liquidity, yet this export is not captured in our current account.  That explains how we can sustain a current account deficit year after year after year, which had always previously been a mystery to me.
Measuring liquidity is a pain in the ass. The value of a good, say an apple, is easy to calculate; just look at the market price for apples. Unfortunately, doing the same for liquidity is much more difficult because liquidity...
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Cathy Lachapelle's profile photoKenneth Duda's profile photo
5 comments
 
> Would the mortgage-backed securities invented by banks that caused such
> problems in any sense fall under this sort of ignored "trade" type, that
> you're talking about?

Yes but this is really true of all asset types.  

> So that there's significant liquidity in such an asset, that isn't
> "counted" in the deficit at issue? It sounds like there is always some
> component to such assets that is counted, but that the liquidity aspect
> is not counted, is that right?


No, none of it is counted in the current account.  When a foreigner buys a bond (or an MBS or whatever), that transaction shows up in the capital account, not the current account.  The liquidity the foreigner consumes over the lifetime of the bond doesn't show up anywhere.  Like JP said, it's really hard to measure, so it's not clear how to fix this, but it solves what (for me) was a deep conceptual problem --- how can it be that we run a current account deficit year after year after year, and yet the balance of assets (US assets held by foreigners minus foreign assets held by US residents) is basically equal?  How can that be?  Surely the foreigners have to do something with all those dollars we are using to buy sweaters and cell phones!  Yes, they use them to buy bonds, but we buy foreign assets too, and it's roughly in balance.  The answer is, those dollars come right back to us indirectly, in the form of a yield differential: our foreign investments yield more than their investments in US securities, because they're willing to "pay" (accept lower returns) for liquidity.  

Sorry, this is all a pretty minor point, and probably obvious to any sophisticated international economist, but for me, it clears up a real mystery.

     -Ken
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Kenneth Duda

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I love the Penske-truck metaphor.  Inflation targeting is flawed, and we know how to fix it --- target the NGDP level instead.  Let's make it happen.
You can learn a lot about macroeconomic policy by driving a Penske truck. I did three years ago when I moved from Texas to Tennessee. The trip began with me driving a 26-foot Penske truck and my wife following in our car. I q...
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Kenneth Duda

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If Larry Summers goes from "not quite endorsing NGDP targeting" to endorsing it, he would probably become a prominent supporter. (Summers almost succeeded Bernanke as Fed chair.)
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Heh.  Don't tell Scott, but I used to get them confused :-)  
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Kenneth Duda

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Great rant from Kevin Erdmann about how markets are misunderstood, focusing on housing.
As I have been working on the piece about limits to urban housing supply, I have coincidentally come across several articles and posts about the problem. There was this New Yorker piece, with a very interesting reaction from ...
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I don't get it. The original New York piece, the Krugman response, and the Glasner response, all talk about empty storefronts in high-rent districts. Why are they empty? The articles all seem to posit, and accept, that the owners prefer not to bring down the rent because that would lock down the rent for a contracted period, making it impossible to hit a "jackpot" rent from a big national/multinational. I don't know about that, but I do know that in my own town there are two empty properties that used to be low-cost neighborhood groceries; in both cases, the owners are being paid by the local national chain to stay empty. Personally, I would love to see the owners slapped with monthly "blight" fines, the way residents are slapped with blight fines if they let their properties go empty or unmaintained. The neighbors didn't get a say in the owner's decision, but they do get to suffer lower housing values, the loss of convenience, and higher grocery prices. Why shouldn't the town get that back in fines? And why shouldn't a city faced with vacant storefronts fine the owners, providing an incentive to get the properties rented? It's not like it's easy to create more supply of storefronts in a crowded city, which I agree is one solution--there's the question, if nothing else, of where to put them!
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Kenneth Duda

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For those interested in monetary economics, this is a very important post.  Separating out changes in the level (of economic activity, of NGDP, CPI) from growth rates (NGDP growth, inflation rate or change in CPI) helps resolve one of the main disagreements in monetary economics.
I've done recent posts on Neo-Fisherism, and the problem of identifying the stance of monetary policy. I've also pointed out that if we can't identify the stance of monetary policy, we can't identify monetary shocks. This is going to be a highly ambitious post that tries to bring together ...
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Kenneth Duda

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Cathy, you might want to check this out.  Kevin is a very smart finance guy, who is by no means arguing positions to line his pockets.  His point is that out attempts to "tame" the markets can sometimes expose very severe disorder, particularly in housing.  He also touches on education.  I certainly don't expect you to agree with him, but I think there is a lot of wisdom in the high-level notion that we should be skeptical of people who think they know better than the markets, a sin committed on both the left and the right.  For example, Alan Greenspan wrote in an op-ed that it was regrettable that the markets were failing to punish us for running high deficits.  Yes, the markets are smarter than Greenspan too.  http://delong.typepad.com/sdj/2010/06/alan-greenspan-it-is-very-regrettable-that-my-model-of-the-world-is-wrong--and-the-world-needs-to-shape-up.html
JOLTS data continues to look strong.  Growth in the major categories continues to be strong (the slopes of the weighted moving averages), and the rates are basically at full employment levels.  Because a labor force that skew...
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5 comments
 
> would there be another human system in there to keep an eye on it as we
> work out the kinks in the new system?

Oh of course, any transition to market monetarism would happen under the oversight of the existing federal reserve structure. It would happen in steps: get a prediction market going; actually use the prediction market for something; make public comments on what we're learning from the prediction market; comment on trend NGDP growth; announce a range of "desirable" levels of NGDP; etc.  Getting to full market monetarism could take 30 years, like it took us to get off the gold standard (1937 to 1971).

> I think I'm particularly sore about economists in general because I've
> heard so many snarky comments about how they do "real" science

Okay, that's just funny, because the economists are always complaining about how the physicists make snarky comments about how physics is a real science and economics is not because if the inability to perform a controlled experiment.

Though here's kind of a funny post by Noah Smith (a great economist) who wonders why people take economists as seriously as they do:

http://noahpinionblog.blogspot.com/2015/05/economists-as-all-purpose-sages-case-of.html

and another funny one by my favorite monetary economist (the leader of market monetarism) complaining how while economists are frequently called on to explain things that they don't really understand, like recessions, they aren't called on enough to explain things they do understand, like water shortages in California:

http://www.themoneyillusion.com/?p=29171

Great line: "That makes about as much sense as the Times asking a Christian fundamentalist preacher whether dinosaurs were warm-blooded."

LOL

    -Ken
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Kenneth Duda

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John Oliver, awesome as always.  Standardized tests, oy.
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I thought he did a pretty decent job explaining it... and it's not at all easy to explain.
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Education
  • Stanford University
    Ph.D., Computer Science, 1993 - 2001
  • Massachusetts Institute of Technology
    BS, MS, Computer ScienceComputer Science, 1988 - 1993
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Introduction
I love programming, especially systems programming of the Linux/C++/kernel/networking flavor.  I run the software team at Arista Networks.  I am deeply concerned about the state of the US economy and what we should be doing to improve monetary policy.  I'm married to Jennifer Duda and have two kids, Molly and Sophie.

Contact me at kjd@duda.org.


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  • Arista Networks, Inc.
    CTO, SVP Software, 2004 - present
  • There, Inc.
    CTO, 1999 - 2004
  • Cisco Systems, Inc.
    Software Engineer, 1995 - 1999
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Cambridge, MA
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Kenneth Duda's +1's are the things they like, agree with, or want to recommend.
The Penske View of Macroeconomic Policy
macromarketmusings.blogspot.com

You can learn a lot about macroeconomic policy by driving a Penske truck. I did three years ago when I moved from Texas to Tennessee. The tr

Housing Tax Policy, A Series: Part 36 - We are the 100%, Housing Edition
idiosyncraticwhisk.blogspot.com

As I have been working on the piece about limits to urban housing supply, I have coincidentally come across several articles and posts about

Full steam ahead on 3 cylinders
idiosyncraticwhisk.blogspot.com

JOLTS data continues to look strong. Growth in the major categories continues to be strong (the slopes of the weighted moving averages), and

No Eureka moment when it comes to measuring liquidity
jpkoning.blogspot.com

Measuring liquidity is a pain in the ass. The value of a good, say an apple, is easy to calculate; just look at the market price for apples.

Robots, committees, or markets? | EconLog | Library of Economics and Lib...
econlog.econlib.org

Ben Bernanke has a good post on the Taylor Rule. Let's start at the end, where he argues in favor of decision-making by the FOMC, rather tha

The road to a housing recovery
idiosyncraticwhisk.blogspot.com

Since the mortgage credit market has been stagnant since 2007, changes in US household equity levels have been almost purely a product of ho

The bizarre way economists calculate real income | EconLog | Library of ...
econlog.econlib.org

Over the years I've argued that economists are horribly confused about the concept of

The Eurozone Counterfactual
macromarketmusings.blogspot.com

Imagine the ECB had not raised its interest rate target in 2008 and 2011, but had lowered it. Also imagine the ECB began its open-ended QE p

Housing Tax Policy, A Series: Part 8 - The crisis didn't happen the way ...
idiosyncraticwhisk.blogspot.com

As far as I can tell, just about everyone agrees on the following series of events: 1) House prices driven up by predatory lenders, or publi

TheMoneyIllusion » My new career
www.themoneyillusion.com

I have spent the past 6 years trying to do two jobs at once, my teaching job at Bentley and lots of blogging/writing/speaking on monetary re

What Do John Cochrane, Paul Krugman, and Scott Sumner Have in Common?
macromarketmusings.blogspot.com

What do John Cochrane, Paul Krugman, and Scott Sumner have in common? A lot more than you think. It would be easy to conclude otherwise base

Tribal Reality and Extant Reality
noahpinionblog.blogspot.com

(This is adapted from a rather silly speech I like to give to my finance classes when the slide projector breaks. Warning: includes blatant

Content economics, part 5: news
blogs.reuters.com

The conception of what counts as news is going to get broader. It will include living articles of the kind that Klein is talking about; it w

Best of Interop 2013 Winners Announced - Network Computing
www.networkcomputing.com

The Best of Interop award recognizes innovation in eight tech categories, including networking, cloud, security, mobility and more. Winners

Subway Surfers
market.android.com

DASH as fast as you can! DODGE the oncoming trains! Help Jake, Tricky & Fresh escape from the grumpy Inspector and his dog. ★ Grind trains w

When does fiscal stimulus work?
www.economist.com

RECOVERIES around the world are looking less certain than they did a few months ago, and this has prompted a new round of calls for addition

Mein Unbehagen mit Quasi-Monetarismus / My Discomfort with Quasi-Monetarism
kantooseconomics.com

English Ein Gastbeitrag von Henry Kaspar Regelmäßigen Lesern dieses Blogs wird der Begriff "Quasi-Monetaristen" ein Begriff sein: eine

Searching for a pot of gold
www.economist.com

Readers suggest some alternative economic indicators  A FEW weeks ago The Economist invited readers who enjoy our Big Mac index to invent o

Friendly, good service, short lines, convenient hours, no run arounds... Highly recommend.
Public - a month ago
reviewed a month ago
The food is tasty, the people are nice, and the prices are very reasonable. There's a small outdoor dining patio (no indoor dining area). We had the cheese ravioli with meat sauce, very good.
Public - a year ago
reviewed a year ago
Best data center networking gear on the planet. :-)
Public - 4 years ago
reviewed 4 years ago
5 reviews
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Our whole family loves this school. If your top priority for your child is memorizing multiplication tables at the youngest possible age while avoiding any exposure to dirt, this may not be the school for you. But if want your child to learn about citizenship, being part of a community, taking responsibility and making good choices, all while developing a life-long love of learning, then you've come to the right place. Maybe the shortest convincing testimonial comes from a fellow parent, a teacher at a local high school, who observed that his most engaged, most dynamic, most with-it students came disproportionately from Peninsula School... so that's where he sends his daughter.
• • •
Public - 2 years ago
reviewed 2 years ago
It's a no-hassle experience for sure. Sam Ebrahimi (salesman) drove me home and then back to the dealership, making things easier. Pricing seemed fair and consistent with the modest amount of Internet data I scraped up.
Public - 4 years ago
reviewed 4 years ago