Paul Krugman On The Economy

Wednesday, 29 October 2008 10:21 Written by The Lone Deranger

If you want to understand the basic facts of the economic crisis facing us today, take 30 minutes to watch this video. Charlie Rose interviewed Paul Krugman on October 23, 2008, shortly after he won the Nobel Prize in Economics. Krugman discusses the causes and outlines several possible solutions.

If institutions need to be rescued like banks, they should be regulated like banks.

Krugman on Charlie Rose

A Panic Like 1873, Not 1929

Wednesday, 15 October 2008 14:07 Written by The Lone Deranger

A lot of comparisons have been made in the press between the current bank liquidity crisis and the Great Depression of the 1930′s. However when you look at the fundamentals there are some stark differences. The contraction of the money supply in 1930-31 was an after-effect of the stock market crash of 1929 and hyper-inflation in Europe. In today’s economy the huge losses in the stock market are the result of a dramatic contraction of the money supply. That’s also what happened in the Panic of 1873, and the result was a four year depression of the economy that dwarfed the depression of the 1930′s.

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The Economic Rescue Package

Monday, 13 October 2008 23:43 Written by The Lone Deranger

Congress gave $700 billion dollars to the Treasury Secretary ten days ago, with instructions to use it to restore liquidity to our banking system. To date nothing has been done. Secretary Paulson seems to be unable to break away from the discredited free market ideological straight-jacket of the Bush administration. The situation worsens with each day that passes. There is only one workable option on the table: the government must buy stock in our banking institutions in quantities sufficient to restore their balance sheets. Only then will the banks be able to resume lending.

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The Roots of Bank Insolvency

Monday, 13 October 2008 20:58 Written by The Lone Deranger

Most people are wondering how the economy got into the mess we’re experiencing today. For those who truly want to understand the situation, Nobel-winning economist Paul Krugman gave a great overview last December. According to him, all hell broke loose in the economy in August of 2007. Since that time the Bush administration has been, in Krugman’s words, “re-arranging the deck chairs on the Titanic.” In the video below, Krugman spoke and took questions on the state of the economy at Google’s headquarters for just over an hour on December 14, 2007. It is the most insightful and direct explanation you’ll ever hear, luckily Krugman is knowledgeable, intelligent and intelligible, a rare combination.

Video: Paul Krugman on Bank Insolvency

@thelonederanger