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Paul Krugman in 2002 after the moderately severe 2001 US contraction: “To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble”. [...] The misallocation of resources into the disastrously inept US finance sector is chronicled in this Harvard Magazine article. Of 6500 selected Harvard graduates from 1969-1990 22% of those graduating in 1970 were in finance 15 years later. But 38% of those who graduated in 1990 were in finance 15 years later. Similar changes occurred for [...] I am sure that Paul Krugman’s ‘How did economists get it so wrong?’ will get much attention in the blogosphere. Worth a read although I don’t believe that policy-makers were as naive as he suggests. They lacked knowledge and always will. A good read for economic students along with the earlier counter-counter-revolutionary work of Robert Lucas. [...] Here. We are getting glib critiques of economics (and particularly of the EMH) in the wake of the fast-receding GFC. RL sets things straight. Let me take an excerpt from The Economist: [...] A pessimistic, scathing critique of the Geithner plan by James K. Galbraith. In some ways mimics Paul Krugman’s pessimism in the NYT . Here are reservations along similar lines by John Quiggin. HT AlterNet, an excellent site. |
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Copyright © 2012 Harry Clarke - All Rights Reserved |
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