I can be very brief because I see very much eye to eye with Professor Fellner. Let me start by saying that I too have some misgivings about what we call the hard-line version of the rational expectations proposition. By the hard-line version I mean the version that says flatly that macroeconomic policies or, more precisely, systematic macroeconomic policies are ineffective; they do not affect the real economy but only prices. In Professor McCallum's paper the hard line has been softened considerably. Let me mention a few of the qualifications. He speaks now of a transition period. When the systematic policies are adopted, it takes a while until the postulated results emerge. Of course, the ineffectiveness applies only to the "systematic," not to the "unsystematic" part of macroeconomic policies. But here I have difficulties. To me it seems a little artificial to distinguish sharply between fully systematic and predictable policies, on the one hand, and entirely unsystematic and unpredictable policies on the other. Actually, policies are almost always somewhere in betweenit is a matter of more or less, not either-or. You cannot classify policies in two watertight compartments. And related to this is that not all agents in the market appraise macroeconomic policies the same way. The hard-line version of the theory assumes that everybody is a monetarist and draws the same monetarist conclusions from the same premises. It is now conceded that there may be differences, but the differences will average out; the more optimistic predictions and the less optimistic expectations will average out and compensate each other. But if you assume, as I believe you have to, that different agents in the market react differently (have different expectations), then it seems to me that you cannot simply assume that the average will be the right monetarist one. What I propose to do is to confront or compare the rational expectations theory with what I call the post-Keynesian consensus. (See my paper "Notes on Rational and Irrational Expectations" in Wandlungen in Wirtschaft und Gesellschaft, Festschrift fur Walter Adolf Johr, edited by Emil Kung [Eubingen: J. C. B. Mohr (Paul Siebeck), 1980], available as an American Enterprise Institute reprint.) By "postKeynesian consensus" I mean largely the moderate monetarist position and Fellner's