Re:Paul Krugman: The austerity delusion
by douglasisshiny on Wednesday April 29, 2015 @02:42PM
(#9460691)
Q1 '15 is being considered a blip for many reasons (weather, west coast port strike, the strong dollar [1], big hits in the energy markets and markets affected by energy, etc.). Many economists expect a bounce back, much like last year.
1. Remember when people, counter to what Krugman said, said the dollar was going to experience hyperinflation?
Re:Paul Krugman: The austerity delusion
by adventured on Wednesday April 29, 2015 @02:27PM
(#9460564)
The 40 to 50 year global experiment in Keynesianism has been a complete disaster. The greater extent a country has put it to work, the bigger the disaster.
All it has done, is give governments an excuse to drastically spend beyond their means to fake growth and well being that isn't real. Then they act so shocked when their economies sink into recession the moment the stimulus programs stop. The US, Europe, China, Japan are all drowning in this fraud, with $60-$80 trillion in new debt over the Keynesian reign, and absolutely nothing to show for it but economic strangulation and upset voters.
I'm seeing the results of Krugman's philosophy on the ground: Asset prices are way up. Housing in my city is almost as expensive as it was before the '08 crash. For those of us that are lucky enough to own stocks and a house -- three cheers for Krugman, 0% interest rates, and QE!
But the asset economy is outpacing the real economy. Wages are not up. Working age labor force participation is down. Q1 GDP was flat. If you're a working person in the U.S. right now, you're not thriving.
And to me this is a sign that Keynesianism is perhaps played out. We're increasing asset prices, making housing more expensive and increasing inequality, without actually growing the economy.