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

To: Katelew who wrote (113522)	6/16/2009 1:36:42 PM
From: Mary Cluney	Read Replies (2) \| Respond to of 541933

<<<Krugman actually wanted the government to create a bubble. It's hard to believe he didn't double-check himself when he saw those words in print.>>> I don't see where Krugman wanted to create a bubble: "The screenplay for that kind of movie always ratchets up the tension. The besieged citadel fends off assault after assault, but again and again rescue is delayed. And so it has played out in practice. Consumers kept spending as the Internet bubble collapsed; they kept spending despite terrorist attacks. Taking advantage of low interest rates, they refinanced their houses and took the proceeds to the shopping malls...... Bear in mind also that government officials have a stake in accentuating the positive. The administration needs a recovery because, with deficits exploding, the only way it can justify that tax cut is by pretending that it was just what the economy needed. Mr. Greenspan needs one to avoid awkward questions about his own role in creating the stock market bubble."