# A Little Humility, Please, Mr. Summers

1 Opinion November 4, 2015 The Wall Street Journal ![A. Michael Spence](/sites/default/files/styles/246w/public/assets/images/con_032670.jpg?itok=cxjGfIlv) By A. Michael Spence and Kevin Warsh > We suggest an alternative explanation that focuses on the interaction of the new conduct of monetary policy with the level and composition of aggregate demand.

**The former Treasury secretary launches a misguided defense of quantitative easing.**

In a recent op-ed for this newspaper, we proffered an explanation for a phenomenon that most macroeconomic models cannot adequately explain: Why is investment in U.S. financial assets so strong and investment in the real economy so modest?

Former U.S. Treasury secretary and Harvard president Larry Summers took issue with our views on his blog. He was one of the principal architects of the U.S. government’s fiscal and regulatory response, and is among the foremost defenders of the recent conduct of monetary policy. So, Mr. Summers is understandably a fierce defender of the current regime. But his breathless defense of the consequences of extraordinary monetary policy reveals a troubling immodesty.

We would suggest more humility in considering the full consequences that may arise from the new tools and tendencies in the conduct of monetary policy.

Read the full article as published in [The Wall Street Journal](http://www.wsj.com/articles/a-little-humility-please-mr-summers-1446669213?cb=logged0.5612956876710644).

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*A. Michael Spence is a William R. Berkley Professor in Economics & Business.*## Related News

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