In the long run, outsourcing is another form of trade that benefits the U.S. economy by giving us cheaper ways to do things.

Prospects for growth in the year ahead are solid at the national level, and of course, this can only be good news for the Bay Area and California as well. The U. S. economy has shown remarkable resilience in the face of some severe shocks - in particular, the surge in energy prices that began a couple of years ago and the devastation wrought by the twin hurricanes last summer.

Stores don't order merchandise unless they think they can sell it right away. Manufacturers and builders don't produce unless they have buyers lined up. My business contacts describe this as a paradigm shift and they believe it's permanent.

If it were possible to take interest rates into negative territory I would be voting for that.

My bottom line is that monetary policy should react to rising prices for houses or other assets only insofar as they affect the central bank's goal variables - output, employment, and inflation.

Listening to others, especially those with whom we disagree, tests our own ideas and beliefs. It forces us to recognize, with humility, that we don't have a monopoly on the truth.

It slightly worries me that when people find a problem, they rush to judgment of what to do.