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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: JohnM who wrote (104318)2/16/2009 3:54:03 PM
From: Steve Lokness  Read Replies (2) | Respond to of 541941
 
What does Mish have to say about Krugman today;

Message 25416954


Koan with all due respect, economics is not beyond anyone here. You simply refuse to see the obvious as well as what is logically true beyond a shadow of a doubt.

The Obvious
1) You cannot spend your way to prosperity
2) There is no free lunch

That is the obvious.
The reason you are having difficulty is you are listening to clowns like Krugman and Geithner who tell you what you want to hear. ............



To: JohnM who wrote (104318)2/16/2009 4:19:43 PM
From: Steve Lokness  Read Replies (1) | Respond to of 541941
 
John;

I just do not understand Krugman. He says we are in trouble because we borrowed too much, but then goes on to say the way out of our mess is to borrow more - lots more? He is right on about the worth of the American family, but the cause of that is the borrowing from tomorrow for our lifestyle today.

Then reality struck, and it turned out that the worriers had been right all along. The surge in asset values had been an illusion — but the surge in debt had been all too real.

Frankly, I think Krugman is seeing his beliefs go up in smoke and is trying to find some way to salvage his theories. We've been at war the last 7 years under Bush - wouldn't that have made some difference by now? What do we do move into the galaxy to find enough ways to throw money down a rat hole called war?

Perhaps one of the biggest missperceptions Krugman has is where our debt today is placed. In WWII, I suspect most of any debt incurred was from the American's - remember war bonds? Today, our debt, our payments for the interest on the money we borrow, to a large extent goes to our enemies. So Krugman is saying, lets make our enemies and competitors stronger? What possible good can come out of that? Ask Paul for me will you?

steve



To: JohnM who wrote (104318)2/19/2009 5:48:07 PM
From: TimF  Respond to of 541941
 
The bottom line is that there has been basically no wealth creation at all since the turn of the millennium: the net worth of the average American household, adjusted for inflation, is lower now than it was in 2001.

Or put another way, house and stock values have done poorly, when measures from a time period in which prices for both from a time when stocks where at fairly high levels, to a period when we are well in to a recession.

Wow, shocking...


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