Krugman: World economy stabilizing

[DrToast]

Wait, what? I thought Obama was screwing everything up and we were all doomed because of it?

http://www.reuters.com/article/newsOne/idUSTRE54O20L20090525

[AllentownJake]

1. Stabilization means we've hit the bottom

Doesn't mean we are recovering.

[high density]

23. ??? Krugman said he expects growth within 2 months. NM

[AllentownJake]

27. read the entire article

Growth doesn't mean a recovery.

[izquierdista]

2. But read paragraph 4

It's not so rosy if we have a decade long slump in store for us.

[DrToast]

4. That's not the issue

We would be faced with that even if we nationalized the banks like Krugman wanted.

[denem]

5. The decade long slump is what he has been saying for 4 months.

He's revised the sharp downturn accelerating in 2009 by almost 180 degrees. Who knows what he will think of next?

[joshcryer]

9. BS, he's said for months 2009 should slow it down.

[denem]

11. Nope.

[joshcryer]

12. Yep.

[denem]

25. Nope. He's been warning of catastrophic collapse of credit,

aided rather than alleviated by zombie banks, giving rise to a deflationary spiral and a great depression style jolt.

[joshcryer]

30. His position has been that we'd see growth in 2009.

[denem]

41. Yes he has, since there have been signs of growth.

After the Dow bottomed out in mid March, all sorts of opinion started recovering with it.

[joshcryer]

15. Here's a very quick link since you want to lie and spread disinformation:

http://newsaura.wordpress.com/2009/04/26/krugman-growth-in-the-latter-half-of-this-year/

[denem]

29. Yeah, that's his view late April, try early February if you want some real fun.

Better still, read up on anything he said late 2008.

[joshcryer]

39. Those were definitely fun times, but he's still not backing off of his Japan comparisons.

So from my point of view his position hasn't changed that much. Of course it is bound to as time goes on.

[denem]

43. I agree. After 8 years, nothing's desirable about a 'lost decade'.

[depakid]

60. He's been consistent with his view that he expected a bottom out with possible growth in 4Q

[merh]

7. I think you may want to reread that paragraph and those before it.

"I will not be surprised to see world trade stabilize, world industrial production stabilize and start to grow two months from now," Krugman told a seminar.

"I would not be surprised to see flat to positive GDP growth in the United States, and maybe even in Europe, in the second half of the year."

The Princeton professor and New York Times columnist has said he fears a decade-long slump like that experienced by Japan in the 1990s.

I could be wrong, but the "has said" refers to past statements and his present statements reflect stabilization and grown in the coming months/las half of the year.

[vaberella]

13. So what? Krugman has changed his tune?! n/t

[merh]

31. It appears he sees stabilization and positive GDP growth.

"I will not be surprised to see world trade stabilize, world industrial production stabilize and start to grow two months from now," Krugman told a seminar.

"I would not be surprised to see flat to positive GDP growth in the United States, and maybe even in Europe, in the second half of the year."

[joshcryer]

17. His position has not changed from months ago, except he hopes cap and trade is implemented.

Obama will not implement cap and trade, he doesn't have the political power to do so and it is not in their interests anyway.

[merh]

33. Just posting what it is he said

"I will not be surprised to see world trade stabilize, world industrial production stabilize and start to grow two months from now," Krugman told a seminar.

"I would not be surprised to see flat to positive GDP growth in the United States, and maybe even in Europe, in the second half of the year."

[denem]

3. Flat to positive growth in second half of 2009?

Hell Paul, it looks like someone's being doing something right, or you drunk the kool aid.

[vaberella]

16. Kool aid is high in sugar...it needs to be taxed. ^_^ I don't get Krugman. n/t

[joshcryer]

18. What I find amusing about these replies is that people think this is a new position for Krugman.

:rofl:

[DrToast]

21. What I find amusing is that people are completely missing the point of this article

Krugman has said that Obama's plan wouldn't work unless he took over the banks. He has backed down from that.

[joshcryer]

26. Yeah, he's now on to cap and trade (which would be great, but is essentially politically impossible)

But let's be honest, his position hasn't changed much here. Heck, the bank think was mostly "fears."

[vaberella]

28. Cap and Trade is the shittiest idea I have ever freakin heard and still ruins the damn environment.

I do not support it and I'm surprised anyone does.

[Oregone]

35. What is the better alternative?

And I hope you don't reply "Carbon Tax"

[joshcryer]

36. No it doesn't. It taxes carbon. Al Gore wants it.

Don't be ridiculous. How *they* might implement it can go *horribly* wrong, but it can be done right.

[vaberella]

52. Cap and trade doesn't really tax carbons.

It turns the environment into a marketing tool. Most importantly the cap and trade is basically a way to subsidize larger companies. So larger companies get even more money when they sell their cap emission voucher while they have done improvements to lessen carbon emissions with better equipment. And places that want to pollute more are allowed to do it.

What happens? Places that may need to lessen their carbon emissions won't be doing so. IN any event the point being is that carbon emissions will still be going on and still causing severe damage to the ozone layer. What ever changes happen...it's very little in the long run.

[joshcryer]

57. It depends on your implementation. You have to cap it by taxing it.

Then you create a market feedback where those who *innovate* have extra to spare, and then they can *sell* that extra.

It would be sliding window but the main issue is that carbon must be taxed.

[Oregone]

58. No, you cannot ever cap emisions by taxing them.

Companies will pollute up until the tax makes their production cost-inefficient to produce (or margins are no longer justified). The lack of production will increase the value of their goods until the prices rise to allow them to continue production. A straight tax on emissions sets NO ceiling (or cap) on emissions, but instead creates a "sin" type tax that only regulates insofar as market forces allow it to do so. There is no evidence so far that simply taxing pollution will curb emissions in the long run.

Capping is different. What it does is creates a new commodity, which is, the ability to pollute. There is a limited amount of this commodity, so there is a limited amount of emission under ANY circumstances. The cap can never be exceeded. It then allows market forces to determine the price of this new commodity, and, being that it is vital for production, it should behave in trading as any normal commodity (gold/copper/etc) would. That is in secondary to its primary function of actually capping the emissions with a finite number.

[QC]

6. Krugman is an enemy of the people, n/t

[denem]

10. Put two economists in a room and you get three opinions.

To quote Joan Robinson "You study economics so you don't get fooled by economists", or as Dr. Benway would say: "Science, pure Science!"

[joshcryer]

20. I hate economics, but I listen to Krugman. Yes he's wrong a lot of times.

But more often than not, in my experience, he knows what he's talking about. Cap and trade could be extremely good for the economy (and the world), but it ain't happening.

[denem]

37. I think HMS Climate Change has gone belly up,

and all we can do is redouble our efforts. So,yeah, I favor a ferociously tight cap and trade.

[joshcryer]

40. The innovation from cap and trade would be an incredible boon, Obama even discussed it on the...

...first recovery panel. But there was a lot of posturing about it and it's highly unlikely it would ever be implemented to any significant extent.

[TankLV]

55. Nevermind - I didn't fully read your post

[safeinOhio]

32. dupe

[safeinOhio]

34. No, Milton Friedman was.

[Cha]

49. Krugman is a vulture who

takes pot shots.

[denem]

51. That's not worthy of you.

He is a man of very strong opinions, but, like all reasonable economists, adjusts his views as new empirical evidence comes to light.

[QC]

54. He must be placed in preventive detention for the safety of the people. n/t

[leftofthedial]

8. screwed is not the same as doomed.

[denem]

14. Doom is all around us,

it's called climate.

[vaberella]

19. Now all I have to do is wait for Turley to come around & we're good. n/t

[joshcryer]

22. Haha

:rofl:

(PS Krugman has had this position for some time now.)

[DrToast]

24. Stop distorting the issue

http://krugman.blogs.nytimes.com/2009/03/21/more-on-the-bank-plan/

[joshcryer]

42. What issue? He talks about potential fears.

I don't know what the controversey is. Krugman saw growth in 2009 as far back as a month ago.

And this is "news" now? Other than to start another Krugman bashing thread, I mean.

[denem]

47. *** What few noticed is there's been an whole $1.2 trillion TARP II ***

financed entirely by the Fed's "quantitative operation". No, I correct myself, the FOREX markets have noticed, and how, so much so that privateer whores, like Moody's are talking about downgrading US treasuries.

[MarjorieG]

38. He wanted a more aggressive fix, but we didn't have the money, and would really de-stabilize more.

[Oregone]

45. Didn't have the money?!?

We don't have the money for any of this. That isn't actually a dealbreaker. Rather, we didn't have the political leadership.

[vaberella]

53. Who's political leadership didn't we have? n/t

[Oregone]

56. The leadership that was absent of delivering a more efective stimulus...

A stimulus that was more than twice the size and not loaded with ineffective tax cuts. The only "leadership" displayed during the process was Obama's call for a bipartisanship clusterfuck (which just water-downed the bill).

I guess, yes, there was leadership, but I would hardly call it bold and effective. But again, was it leadership, pandering, or political positioning? Regardless, what was needed were bold leaders who not only called for a reinvestment in America, but stuck to their guns and demanded a stimulus that matched their rhetoric.

This is all borrowed money. At least there should be leaders that insist we borrow in a manner that effectively helps.

[Uzybone]

44. Eh, like other commentators Krugman is up and down

too bad he doesnt have the temperment to step up and work in the government.

[joshcryer]

46. Krugman: "We have averted utter catastrophe."

I hope the bashers can at least see Krugman concede this. He did express a lot of fears, whether they were warrented or not can be the cause of many debates. But he's at least admitting it wasn't as bad as he was saying it could get.

Now let's hope we're not on the path to become Japan 2.0.

[denem]

48. I would add, no one rules out the possibility of a double dip recession,

including Krugman.

[OHdem10]

50. Is he referring to the Stock Market Economy???? We have to be

distinguish between the Markets and the "Main Street Economy"/

[depakid]

59. Are you really THAT shallow and ethnocentric?

I know, with a lot of Americans, that's a rhetorical question.

We see evidence of it every single day on these boards.

[backscatter712]

61. IIRC from one of Krugman's articles.

Krugman was disappointed Obama chose to muddle through this economic crisis by using bailouts, but at the same time, recognized that this strategy may actually work.

I think that's what's happening. Obama made the strategic decision not to blow political capital on more drastic measures such as nationalizing banks, and to muddle through this crisis with messy bailouts, but at the same time, had some number crunchers that told him that muddling through would actually work, just as long as he stood prepared with new measures if the economy started crapping itself again.

I am personally seeing a few more signs of life in the economy - the job market's not quite as bleak as before, and I'm seeing more new construction, though it will take a while before unemployment actually comes down.

[Old Hank]

62. According to the OP, Krugman said Obama was "screwing "everything" up

I'd love to read that passage, where Krugman allegedly said Obama was screwing the world economoy up, since your article is about the world economy. Please link to it.

[keep_it_real]

63. If you have not read "Web of Debt" you will NEVER know what is going on

And dudes like Krugman will just continue to jerk your chain.

Get the facts; find out what is really going on that the establish like Krugman will not tell you.

When you read "Web of Debt" you will see Krugman as he is: someone who will NOT tell you the real truth.

Buy this book it is worth every penny and you will not EVER need to read another book on the subject.

http://www.webofdebt.com/