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Tag Archives: stimulus

Ebola Comes to America: Krugman & Stiglitz Must Be Delighted

Paul Krugman is famous for having said essentially that one of the ways the US could pull itself out of the current recession/depression is by mobilizing for an alien invasion. A War of the Worlds would do the trick. Everyone could build space ships and laser guns and whatever to fight the otherworldly menace. Stimulus. Full employment!

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CNBC: Home prices headed for a triple dip

Nothing in housing is fixed. The market is still broken. It might even be worse than before 2008. Government activism (via Fanny and Freddy and most importantly the Federal Reserve) screwed up the market initially and caused the Crash. Yet some in the fever panic thought activist government was the answer to the housing crater caused by government activism.

It wasn’t.

In order for housing to get back to something close to healthy prices needed (need) to crash more. This would have let young buyers in at sustainable levels (even if credit was tight initially) which would have then pushed blood through the real estate sector. Not zombie blood like we have now. But real honest to goodness economic vitality.

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Global Bellwether: Japan’s Social Depression

If you want to see what happens when the Keynesian virus truly takes hold of an economy and a society check out Japan. The once juggernaut of economic power, The Land of the Rising Sun, is now a great example of economic and social zombification as Charles Hugh Smith illustrates below.

It took 1 generation.

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Japan has fallen victim to the Keynesian scam (And so have we)

Japan had “a lost decade.” Then it had another. We are past the halfway mark of the American “lost decade.”

Keynesianism has failed utterly and completely. It’s not that there wasn’t enough stimulus. It’s that the concept of “stimulus” is bunk. It’s real “voodoo economics.” It is a cult. A dream. And as is increasingly obvious even to the Keynesians, a nightmare.

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End the Fed: “We do not need ‘monetary policy’ any more than we need a paintbrush policy, a baseball bat policy, or an automobile policy.”

Indeed we don’t. But we are so conditioned to the idea that the cost of renting money fundamentally should be determined by a central bank that most don’t think anything of monetary policy. When the economy tanks, the Fed’s supposed to ease, when the economy gets too hot it’s supposed to raise rates. This is what we were all taught in our macroeconomics courses. Makes sense…I guess.

Actually not at all. These fluctuations, the business cycle, are created by the world’s central banks.

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