Agree with Dlyons. It is describing the economists as having 'hard heads' (being very sensible/efficient/unemotional) and 'sharp pencils' (implying efficiency/accuracy/precision). The whole image implies that they will ruthlessly calculate what needs to be done to 'avoid the extravagant excesses of the past'.
Agree with Dlyons. It is saying that the economists have hard heads (are unemotional/unafraid and efficient) and sharp pencils (suggesting accuracy, attention to detail, clear sightedness). They will ruthlessly calculate what needs to be done to 'avoid the excesses of the past.'