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Larry Summers: "Welcome To The Non-Recovery" Or "Fiscal Stimulus Or (Another US) Bust"

Tyler Durden's picture




 

Just under a year ago, we got the tax fraud, and the only remaining member of Obama's economic Titanic, praising the US recovery. His timing top ticked the economy, preceded the Hindenburg Omen by 10 days, and ushered in QE2. Now, we get his sidekick, long since departed after totally failing (we use the more polite F-form of the word) up at his job, writing the follow up, from the cushy confines of academia, warning America that unless there is a major fiscal stimulus (because presumably the monetary stimulus which everyone praised in the form of QE2 has now been proven to only be a boost to the stock market and a bailout of European banks), this once great country which once exhibited the world's reserve currency is on its way to another "lost decade." We wish Summers well: perhaps 3 of those who read the following drivel will take him seriously. Two of them are Krugman and Koo. We are taking bets as to who the third one will be...

From the Financial Times:

How to avoid stumbling into our own lost decade

Even with the 2008-2009 policy effort that successfully prevented financial collapse, the United States is now half way to a lost economic decade. In the past five years, our economy’s growth rate averaged less than one per cent a year, similar to Japan when its bubble burst. At the same time, the fraction of the population working has fallen from 63.1 to 58.4 per cent, reducing the number of those in jobs by more than 10 million. Reports suggest growth is slowing.

Beyond the lack of jobs and incomes, an economy producing below its potential for a prolonged interval sacrifices its future. To an extent once unimaginable, new college graduates are moving back in with their parents. Strapped school districts across the country are cutting out advanced courses in maths and science. Reduced income and tax collections are the most critical cause of unacceptable budget deficits now and in the future.

You cannot prescribe for a malady unless you diagnose it accurately and understand its causes. That the problem in a period of high unemployment, as now, is a lack of business demand for employees not any lack of desire to work is all but self-evident, as shown by three points: the propensity of workers to quit jobs and the level of job openings are at near-record low; rises in non-employment have taken place among all demographic groups; rising rates of profit and falling rates of wage growth suggest employers, not workers, have the power in almost every market.

A sick economy constrained by demand works very differently from a normal one. Measures that usually promote growth and job creation can have little effect, or backfire. When demand is constraining an economy, there is little to be gained from increasing potential supply. In a recession, if more people seek to borrow less or save more there is reduced demand, hence fewer jobs. Training programmes or measures to increase work incentives for those with high and low incomes may affect who gets the jobs, but in a demand-constrained economy will not affect the total number of jobs. Measures that increase productivity and efficiency, if they do not also translate into increased demand, may actually reduce the number of people working as the level of total output remains demand-constrained.

Traditionally, the US economy has recovered robustly from recession as demand has been quickly renewed. Within a couple of years after the only two deep recessions of the post first world war period, the economy grew in the range of 6 per cent or more – that seems inconceivable today. Why?

Inflation dynamics defined the traditional postwar US business cycle. Recoveries continued and sometimes even accelerated until they were murdered by the Federal Reserve with inflation control as the motive. After inflation slowed, rapid recovery propelled by dramatic reductions in interest rates and a backlog of deferred investment, was almost inevitable.

Our current situation is very different. With more prudent monetary policies, expansions are no longer cut short by rising inflation and the Fed hitting the brakes. All three expansions since Paul Volcker as Fed chairman brought inflation back under control in the 1980s have run long. They end after a period of overconfidence drives the prices of capital assets too high and the apparent increases in wealth give rise to excessive borrowing, lending and spending.

After bubbles burst there is no pent-up desire to invest. Instead there is a glut of capital caused by over-investment during the period of confidence – vacant houses, malls without tenants and factories without customers. At the same time consumers discover they have less wealth than they expected, less collateral to borrow against and are under more pressure than they expected from their creditors.

Pressure on private spending is enhanced by structural changes. Take the publishing industry. As local bookstores have given way to megastores, megastores have given way to internet retailers, and internet retailers have given way to e-books, two things have happened. The economy’s productive potential has increased and its ability to generate demand has been compromised as resources have been transferred from middle-class retail and wholesale workers with a high propensity to spend up the scale to those with a much lower propensity to spend.

What, then, is to be done? This is no time for fatalism or for traditional political agendas. The central irony of financial crisis is that while it is caused by too much confidence, borrowing and lending, and spending, it is only resolved by increases in confidence, borrowing and lending, and spending. Unless and until this is done other policies, no matter how apparently appealing or effective in normal times, will be futile at best.

The fiscal debate must accept that the greatest threat to our creditworthiness is a sustained period of slow growth. Discussions about medium-term austerity need to be coupled with a focus on near-term growth. Without the payroll tax cuts and unemployment insurance negotiated last autumn we might now be looking at the possibility of a double dip. Substantial withdrawal of fiscal stimulus at the end of 2011 would be premature. Stimulus should be continued and indeed expanded by providing the payroll tax cut to employers as well as employees. Raising the share of payroll from 2 to 3 per cent is desirable, too. These measures raise the prospect of sizeable improvement in economic performance over the next few years.

At the same time we should recognise that it is a false economy to defer infrastructure maintenance and replacement, and take advantage of a moment when 10 year interest rates are below 3 per cent and construction unemployment approaches 20 per cent to expand infrastructure investment.

It is far too soon for financial policy to shift towards preventing future bubbles and possible inflation, and away from assuring adequate demand. The underlying rate of inflation is still trending downwards and the problems of insufficient borrowing and investing exceed any problems of overconfidence. The Dodd-Frank legislation is a broadly appropriate response to the challenge of preventing any recurrence of the events of 2008. It needs to be vigorously implemented. But under-, not overconfidence is the problem, and needs to be the focus of policy.

Policy in other dimensions should be informed by the shortage of demand that is a defining characteristic of our economy. The Obama administration is doing important work in promoting export growth by modernising export controls, promoting US products abroad and reaching and enforcing trade agreements. Much more could be done through changes in visa policy to promote exports of tourism as well as education and health services. Recent presidential directives regarding relaxation of inappropriate regulatory burdens should also be rigorously implemented.

Perhaps the US’ most fundamental strength is its resilience. We averted Depression in 2008/2009 by acting decisively. Now we can avert a lost decade by recognising economic reality.

The writer is Charles W. Eliot University Professor at Harvard and former US Treasury Secretary. He is an FT contributing editor

 

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Sun, 06/12/2011 - 18:09 | 1363559 Noah Vail
Noah Vail's picture

". . . perhaps 3 of those who read the following drivel will take him seriously. Two of them are Krugman and Koo. We are taking bets as to who the third one will be..."

 

Not me, I won't bother to read it. That's what we have you for, Mr. Durden, to wade through the cesspools so we don't have to. LOL

Sun, 06/12/2011 - 18:25 | 1363592 bigdumbnugly
bigdumbnugly's picture

the third one was krugman again.

he reread it one more time it was so riveting.

Sun, 06/12/2011 - 19:31 | 1363691 cosmictrainwreck
cosmictrainwreck's picture

riveting

Mon, 06/13/2011 - 01:11 | 1364108 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The third one was Geithner, and it was so riveting he did not pay his taxes again so he could buy his icloud, because he believed that would stimulate the economy.

Sun, 06/12/2011 - 19:54 | 1363732 drbill
drbill's picture

+3

Laughed so hard I almost dropped my copy of Keynes' "General Theory"!

Sun, 06/12/2011 - 21:06 | 1363818 Hernando
Hernando's picture

As much as I wish to laugh at Summers, I can't help but remember that this clown - traitor - idiot savant along with Greenspan, Paulson, Senator Gramn of Texas, Mozilo and Rubin have destroyed the greatest country in history.

 

This clown along with his fellow traitors deserve a military firing squad to set an example for history.   As things get much worse over the next few years, the cries for justice will become much louder and so will the viability of the firing squad option.

 

 

Sun, 06/12/2011 - 21:20 | 1363827 Ned Zeppelin
Ned Zeppelin's picture

Couldn't have said it better - one can only hope that justice will have its day. 

Sun, 06/12/2011 - 23:37 | 1364001 TruthInSunshine
TruthInSunshine's picture

I'd hate to see Obama being generous to  Wall Street...

Seriously...could they have had it any better?

 

Obama Seeks to Mend Fences and Win Back Wall St. Cash
  • By NICHOLAS CONFESSORE 10:19 PM ET

President Obama has started an aggressive push to win back the allegiance of a vital source of campaign donations in 2008.

 

 

Mon, 06/13/2011 - 01:45 | 1364137 Ben Dover
Ben Dover's picture

Justice is a fiction here. Firing squads and justice will be served upon many, but not upon the most diserving. W0rd.

Sun, 06/12/2011 - 18:09 | 1363564 SpiritBlade
SpiritBlade's picture

Great points,

We are entering into the days when folks are finally bailing off the fence to their respective sides. Some will go towards J. Taggert, others Hank Reardon.

I would certainly hope most of our esteemed collegues side with Mr. Galt on this. Perhaps with a smattering of Ragnar;)

Lets embrace the total collapse as a new beginning

 

III%

 

Sun, 06/12/2011 - 19:05 | 1363639 Dejean Splicer
Dejean Splicer's picture

I'll just embrace my metal, bitchez!

~O~

Sun, 06/12/2011 - 22:21 | 1363915 Freddie
Freddie's picture

Summers was part of it with Hussein.  Funny watching all the little ass boys here on ZH trying to disown their hope & change votes.

Sun, 06/12/2011 - 18:10 | 1363567 SloMoe
SloMoe's picture

My god, he has no shame, conscience or memory...

Sun, 06/12/2011 - 19:29 | 1363681 zaknick
zaknick's picture

My thoughts exactly. My guess is you will get this kind of in your face charlatans until the mob is literally taking control of everything. This fight over cuts in Washington...if I'm correct about the pain headed for a neighborhood near you, lots of people are going to be joining us in constantly saying WTF to the "news".

Good...

Sun, 06/12/2011 - 19:46 | 1363715 macholatte
macholatte's picture

Perhaps Bonzai can do something with this:

http://www.time.com/time/covers/0,16641,19990215,00.html

Sun, 06/12/2011 - 20:06 | 1363745 Problem Is
Problem Is's picture

What a bag of incompetent ass holes...

Fuck ups and fucktards, one and all...

Sun, 06/12/2011 - 23:23 | 1363982 williambanzai7
williambanzai7's picture

Mon, 06/13/2011 - 04:56 | 1364221 macholatte
macholatte's picture

 

   Thanks   :)

Sun, 06/12/2011 - 21:42 | 1363851 ElvisDog
ElvisDog's picture

Totally agree. Does he really believe or think that we believe that the answer to a debt saturated economy is to take on more debt? I also like this comment:

The underlying rate of inflation is still trending downwards

WTF? I suppose the underlying rate of home prices is trending downward. But energy, food,  medical care, education expenses? Not so much. The University of Washington just announced plans for a 20% tuition increase.

Sun, 06/12/2011 - 18:12 | 1363571 Conrad Murray
Conrad Murray's picture

The central irony of financial crisis is that while it is caused by too much confidence, borrowing and lending, and spending, it is only resolved by increases in confidence, borrowing and lending, and spending.

Those who can, do. Those who can't, spray shit into the air like Tubgirl.

Sun, 06/12/2011 - 18:47 | 1363619 TheGoodDoctor
TheGoodDoctor's picture

Conrad, have you seen the latest South Park?

Sun, 06/12/2011 - 21:22 | 1363829 Ned Zeppelin
Ned Zeppelin's picture

I remarked how this latest "everything is shit" episode is different from any other, and bit unnerving at that. Even the South Park boys have noticed a turn of events. 

Sun, 06/12/2011 - 19:14 | 1363655 moonstears
moonstears's picture

Everybody knows he's right, more spending and credit will fix it, just as we all know more unprotected sex cures syphilis. :) 

Sun, 06/12/2011 - 18:15 | 1363572 AladdinSaneGirl
AladdinSaneGirl's picture

He's saying to increase government spending on socially-useful tasks such as improving infrastructure, and increasing exports. This sounds a better way to stimulate the economy than printing more money for the banks ... if I've understood it correctly. At least engineering, construction shares would get a boost, presumably also oil and miners ...

Sun, 06/12/2011 - 18:51 | 1363622 docj
docj's picture

Sorry, we already tried that.

http://www.recovery.gov/About/Pages/The_Act.aspx

It failed then. Miserably. And sequels allways suck worse than the original, even when the original, uh, sucks.

Sun, 06/12/2011 - 22:31 | 1363925 Freddie
Freddie's picture

I know a bunch of local towns with brick & paver street sections, sidewalks, solar street lamps and other crap.  Largely with African American labor.   Anyone remember in 2008 where hussein's team said white men would not get any of these inrastructure jobs?  I saw a lot of em in progress and they were all like that.

 

Oh and all these paver streets fall apart fairly quickly.  They can work on a driveway but not on streets.  They crack and crumble.

Sun, 06/12/2011 - 23:54 | 1364034 Prometheus418
Prometheus418's picture

They're working on the highway between my home and work (again.)  While there are white folks on the crews, what I did notice was that while I was driving past, there were fifteen people on the crew.  One was operating a machine, and the other 14 (yes, I counted) were standing there slack-jawed and idle.  

Nor were they doing a long-term job on the highway.  They stripped about two inches off the surface, and were replacing the concrete with asphalt, poorly.  Wavy lines, and poor blending between the lanes.

Hooray for government progress!

Sun, 06/12/2011 - 18:16 | 1363575 lizzy36
lizzy36's picture

Obama promoting exports, by devaluing the USD is the version of winning the future the smartest man in the room subscribes too.

Thanks i will pass.

Btw, has the smartest man in the room ever been right about anything? bueller?

Sun, 06/12/2011 - 20:04 | 1363741 Problem Is
Problem Is's picture

"Fat" Larry knows what's good for lunch...

         "Fat" Larry knows which meeting to sleep through...

Sun, 06/12/2011 - 18:18 | 1363578 Smiddywesson
Smiddywesson's picture

Sorry, I can't read his drivil.  He doesn't deserve a serious read.  

I know these fellas have all the best arguments for xy and z, but they are complete failures, deserving my mute button.

Sun, 06/12/2011 - 19:12 | 1363645 Dejean Splicer
Dejean Splicer's picture

Ignoring will get us nowhere.

Put your spurs on, grab a fistful of mane, and dig your spurs into the loins of the beast.

Sun, 06/12/2011 - 18:18 | 1363579 Wombat
Wombat's picture

I guess European banks were "shovel-ready projects."

Sun, 06/12/2011 - 19:49 | 1363726 macholatte
macholatte's picture

 

           :)

Sun, 06/12/2011 - 20:35 | 1363787 nmewn
nmewn's picture

Winner!

Sun, 06/12/2011 - 18:24 | 1363581 apberusdisvet
apberusdisvet's picture

The man who came close to destroying Harvard's endowment should be consigned to the padded room where he and Timmah can argue over Anthony' s weiner, while Barney gives pointers.

Sun, 06/12/2011 - 20:00 | 1363738 Problem Is
Problem Is's picture

How about that padded room being the cell next to Bernie Madoff...

Sun, 06/12/2011 - 20:01 | 1363739 JustPrintMoreDuh
JustPrintMoreDuh's picture

Bwarny Fwank would more likely provide lip service re: the weiner.

Sun, 06/12/2011 - 18:23 | 1363584 Hedgetard55
Hedgetard55's picture

" Reduced income and tax collections are the most critical cause of unacceptable budget deficits now and in the future."

     Fuck you Larry. Out of control spending is the problem, something a brain dead libtard like you will never admit. You and your University represent everything I despise in this world.

    

Sun, 06/12/2011 - 18:32 | 1363601 Masked Man
Masked Man's picture

Larry Summers is hardly a liberal in his economic and social views. Read up on him.

Sun, 06/12/2011 - 19:24 | 1363667 jo6pac
jo6pac's picture

Yep, pure Shock Doctrine and we've been set up for the great fall.

Sun, 06/12/2011 - 19:33 | 1363684 Spastica Rex
Spastica Rex's picture

Anyone not calling for an end to all government services (except the millitary) is a liberal.

Sun, 06/12/2011 - 20:13 | 1363755 Terminus C
Terminus C's picture

and the military needs to be cut to one third of its current size.

Keep the nukes, fuck the rest.

Mon, 06/13/2011 - 09:27 | 1364547 falak pema
falak pema's picture

how about justice? I mean real justice not GWB type justice...

Mon, 06/13/2011 - 09:59 | 1364610 Urban Redneck
Urban Redneck's picture

Reduced income and tax collections are the most critical cause of unacceptable budget deficits now and in the future.

Well at least he readily admits to the philosophy I have accused him of- 

Increased banker income and tax collections are the most critical cure for unacceptable budget deficits now and in the future.

Sun, 06/12/2011 - 18:27 | 1363586 Sudden Debt
Sudden Debt's picture

Why do you think that they bailed out Europe?

Because the derivative bombs fuse is there.

Which the US created to their benefit but a bust will also be their demise.

They didn't save European banks because Europeans are smarter, better looking...

They saved the banks because the world economy would be destroyed and the reserve currency would go up in flames.

The fact that this was more important then to create jobs and save the US economy just shows the threat.

And it's not over. it keeps on getting worse. So when it implodes it will be worse for the US economy than if they wasted the money on creating US jobs without content. The US industrial base belongs to China, deal with it and move along.

And because the European economy is actually recovering very well, there might well be no QE3 if it holds.

Sorry guys, the FED won't do a QE3 just to save the US economy. It will have to do it on it's own.

So deal with it or move to Europe.

 

Sun, 06/12/2011 - 18:35 | 1363606 Caviar Emptor
Caviar Emptor's picture

The banks on both sides of the Atlantic were complicit. The bankers on both sides lined their pockets by pretending that more securities were needed to insure other securities which insured yet further securities against default. It was a gravy train that made many rich. And now it has stopped and taxpayers on both sides have to deal with the mess.

Sun, 06/12/2011 - 18:24 | 1363588 Masked Man
Masked Man's picture

Reuters.com has been running a banner announcement all weekend long that Larry Summers is going to be writing a column on the "jobs crisis" on Monday. It sounds like it's going to be a regular column as the media is finally (after 3 years) waking up to the unemployment problem.

Larry Summers has spent most of his life in academia. He hasn't worked an honest day in his life. What exactly qualifies him to be writing a column about jobs?

Sun, 06/12/2011 - 18:42 | 1363617 Libertarians fo...
Libertarians for Prosperity's picture

as a man, he has the inherent ability to understand everything.

Sun, 06/12/2011 - 19:24 | 1363669 lynnybee
lynnybee's picture

 " What exactly qualifies him to be writing a column about jobs? "     NOTHING !  ABSOLUTELY NOTHING !   he's an idiot, along with his criminal co-horts Robert Rubin & Alan Greenspan ........ all i see is that TIME MAGAZINE cover of those 3 so-called Masters of the Universe .     As my Dad used to say when confronted with idiots, "what a horses' ass."

 

Sun, 06/12/2011 - 19:55 | 1363729 QQQBall
QQQBall's picture

Writing about US unemployment problems sounds kike a long-term gig for Fat Larry

Sun, 06/12/2011 - 18:28 | 1363590 tamboo
tamboo's picture

this just in: another self chosenite enriched himself and the tribe

by looting various public and private funds. shocking.

Sun, 06/12/2011 - 18:31 | 1363596 plocequ1
plocequ1's picture

Dump your pension. Problem solved.

Sun, 06/12/2011 - 18:33 | 1363591 plocequ1
plocequ1's picture

He's still around? I thought he headed due west  with Paul Voclker and Jeremiah Johnson

Sun, 06/12/2011 - 18:26 | 1363593 AurorusBorealus
AurorusBorealus's picture

I recently drove down a major American interstate.  Nearly 1/3 of the road and every bridge was marked with cones for construction.  There were a few "workers" milling about, but no real work done.  Traffic was at a stand-still for miles as a result of all of this "infrastructure construction."  In fact the situation on the highway was so bad that the public would have been better served had the entire interstate highway simply been closed indefinately, rather than forcing 10s of thousands of motorists to sit stranded and burning gasoline in an enormous traffic jam.  This is the reality of this idiot's proposals.

Sun, 06/12/2011 - 20:10 | 1363753 HungrySeagull
HungrySeagull's picture

Only if a bridge or vital part fails, then there is action. Otherwise the stuff built since the 60's continue to crumble.

 

My area has discovered it's cheaper to shave the concrete plates smooth than it is to tear it all up and rebuild. They have been replacing the highway little by little for years now. It's no better than it was 10 years ago.

 

Finally we said fuck it. No more commutes that a way. We stay in our county for work in peace for much less. That way we don't have to repair or replace our paid for vehicles.

Sun, 06/12/2011 - 20:13 | 1363756 RunningMan
RunningMan's picture

AB - you aren't the only one who has observed this. A couple of others myself included have posted similar comments over the past few months. The irony is that it really is impacting productivity when it keeps workers from being on time. I guess we do need some infrastructure modernized, so it can't be all bad, but seems to be money poorly spent efficiency wise.

Sun, 06/12/2011 - 18:34 | 1363598 r101958
r101958's picture

'The underlying rate of inflation is still trending downwards' ......I guess, if you believe the bogus gov't figures.

Sun, 06/12/2011 - 18:47 | 1363618 bigdumbnugly
bigdumbnugly's picture

i believe he was referring to his man-boobs there, r.

Sun, 06/12/2011 - 18:31 | 1363599 steve from virginia
steve from virginia's picture

Summers beats that dead horse 'growth' like a drum. Just as Bernanke/Greenspan could not tell the diff between inflation and deflation, Summers cannot tell the diff between demand- and supply constrained economies.

All the ol' fashioned growth nostrums will fail. No productivity b/c peak oil (1998) has machine- derived productivity costlier more than non- machine version. The imbeciles who make up the establishment such as Summers are fixated on machine- derived 'stylishness', not realizing it has been a fad.

I know peeps don't like the non- productivity idea. Sorry kids, net-energy rules, leaving little but back breaking work and having to learn a 'skill'. Peeps will have to 'go back in time' to before 24 electricity, cheap gas, ' easy, easier and easiest' and 'Dial a Mexican'.

We're all Mexicans now ... if we are lucky.

Instead, more flatulent promises of easy jobs, easy money, more and more easy/stupid and plenty of the foolish to believe.

A sucker born every minute, right?

Sun, 06/12/2011 - 18:31 | 1363600 buzzsaw99
buzzsaw99's picture

it's a man baby

Sun, 06/12/2011 - 18:35 | 1363602 azengrcat
azengrcat's picture

You forgot Mr. Summers first name: "The Brilliant" Larry Summers

Sun, 06/12/2011 - 19:29 | 1363685 hbjork1
hbjork1's picture

I thought we had established, quite a long time ago now, that Summers did not really know what he was doing.  I have no doubt that he enjoyed the prestige of the position and enjoyed pontificating from his lofty position. But HE DID HAVE AN EFFECTVE GRASP ON WHAT WAS HAPPENING. 

Money, even gold, only has value if it can be exchanged for something that people need for their own living or production of the means of living for others. 

IMO, fundamentally, Summers was more or less, faking his way through the resolution of the problems, hoping. 

All the folks at the FED are highly educated in finance; in that department we cannot do better.  What we could do that might benefit is give provide an isolated survival training camp where they have to build their own shelter, give them all a million dollars and let them provide for themselves, with only the labor available within their group.  

 

Sun, 06/12/2011 - 20:04 | 1363748 rufusbird
rufusbird's picture

There's something about Larry...

Sun, 06/12/2011 - 18:36 | 1363607 svendthrift
svendthrift's picture

Fuck Summers. When the Elders fall, he'll be tried and appropriately punished for crimes against humanity for his role in the destruction of the Russian economy.

Sun, 06/12/2011 - 18:39 | 1363611 Caviar Emptor
Caviar Emptor's picture

Economics simplified: 

1983: Shop 'till you drop.

2008: We dropped. 

Any questions? 

Sun, 06/12/2011 - 18:52 | 1363625 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

The consumer is dead. And we have killed him. Check.

If the consumer is dead, then from its ashes arises ... gangs of workers with picks and shovels? That would appear to be Summer's vision. Chinese rail workers of the 1800s unite, redux.

I'm not sure how maintaining the empire would fit into that picture. Or the reserve currency.

What I most certainly agree with is that the consumer is dead. Another way must be found.

Sun, 06/12/2011 - 19:02 | 1363634 Caviar Emptor
Caviar Emptor's picture

One suggestion that hasn't been examined enough: Americans need to start acting very picturesque and charmingly simple to start attracting rich tourists from the places in the world where money is being made. Going along with that we need lots of roadside attractions, village festivals, sidewalk cafes and international menus. People should consider dressing in traditional outfits and singing while they walk or drive. There's a lot of merchandising that can go along with that. 

Sun, 06/12/2011 - 19:23 | 1363663 Dejean Splicer
Dejean Splicer's picture

LoL. We're all Amish now.

Sun, 06/12/2011 - 19:41 | 1363704 Amish Hacker
Amish Hacker's picture

Can I interest you in a hand-made chair?

Mon, 06/13/2011 - 01:37 | 1364134 StychoKiller
StychoKiller's picture

How about a PC mouse carved from basswood? :>D

Sun, 06/12/2011 - 19:28 | 1363672 moonstears
moonstears's picture

Been to Chicago? Cool ethnic dress and dialect there, in the "fine Government subsidized apartments". Go before dark if you're too pale, or bring a friend who's got a good tan, trust me!

Sun, 06/12/2011 - 19:46 | 1363705 zaknick
zaknick's picture

After 50 years of raping and pillaging KKK/Zionista bankster empire, I dint think you're gonna have much luck with tourism. In fact, thanks to KKK posing as cops at airports, since 2001 tourism has plummeted.

Let me tell you something else. I don't know if it's because the US economy is doomed or all my emails to newspapers and journalists in both the English and Spanish speaking worlds but the war in drugs fake righteousness thing is coming unglued! Must be the Internet!

Sun, 06/12/2011 - 19:52 | 1363723 Implicit simplicit
Implicit simplicit's picture

How about the seven dwarves whistling song:

"I owe, I owe, so its off to work I go"

Sun, 06/12/2011 - 20:15 | 1363758 HungrySeagull
HungrySeagull's picture

Anyone coming here to USA should experience Mcdonalds, not some butchered hash of what they eat back home.

Sun, 06/12/2011 - 20:34 | 1363782 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Isn't that why they come to New York?

Sun, 06/12/2011 - 18:53 | 1363627 docj
docj's picture

Well played.

Sun, 06/12/2011 - 19:42 | 1363701 moonstears
moonstears's picture

lol, good shit!

Sun, 06/12/2011 - 18:45 | 1363613 ebworthen
ebworthen's picture

 

The same foolish sentiments and hackneyed econometric taffy of those who stumble through the funhouse mirrors at the carnival arcade.

They can babble and bark from the stalls and rings all they want; I am not coming back to the circus and I am pulling all the tent stakes I can.

 

Sun, 06/12/2011 - 18:50 | 1363628 buzzsaw99
buzzsaw99's picture

you won't be able to see abby jo the bearded lady if you don't pay up.

Mon, 06/13/2011 - 03:23 | 1364187 ebworthen
ebworthen's picture

...you mean Romer, don't you?...

Sun, 06/12/2011 - 18:48 | 1363624 Caviar Emptor
Caviar Emptor's picture

US exports not currently being promoted enough:

-Pole dancers, crotch shot photographers, game show hosts, KFC extra crispy, American beer, shock jocks, droopy shorts, Ashlee Simpson, 

Sun, 06/12/2011 - 18:50 | 1363626 THE DORK OF CORK
THE DORK OF CORK's picture

Fuck this venetian bank shit - lets light this fucking candle.

www.youtube.com/watch?v=wSv5383Dpvs

 

Sun, 06/12/2011 - 18:54 | 1363631 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Pole dancing has become a bonafide sport. I saw it on a talk show. Quite the athlete they presented.

Sun, 06/12/2011 - 19:03 | 1363635 New American Re...
New American Revolution's picture

Oh, BRAVO (clapclapclapclapclap) BRAVO!!!    What pure and unintelligable claptrap, BRAVO!   The author of this piece came just this short of a Teddy Kennedy speech as he was unable to perform a few fragments and run-on's that clearly made no sense whatsoever.    Instead, he has woven a mirage that appears to contain water but would leave a dying man to his thirst.   Certainly, if this fellow hasn't a future in Harvard he's prime material for Corruption DC.   

I am dually depressed.

Sun, 06/12/2011 - 19:06 | 1363642 Eireann go Brach
Eireann go Brach's picture

He is the epitome of the fucking arrogant American bastard that the rest of the world perceives and hates when yanks come into their towns as tourists around the world!

Sun, 06/12/2011 - 19:12 | 1363646 equity_momo
equity_momo's picture

The 3rd will be the American Public once they get a taste of the GREAT Great Depression.

Secure your gold now , GD 2.0 will have the stupid mther fuckers who got into too much debt begging , PRAYING nay PLEADING on their bended fucking knees for the shitnbags in DC to print and print big.   FOODSTAMPS AND QE - thats all the American idiots will vote for.

Sun, 06/12/2011 - 19:13 | 1363649 Everybodys All ...
Everybodys All American's picture

There are so many idiots out there it's hard to just select one who agrees with more stimulus. Robert Reich, Obama, Bernanke, and countless media tards head the list. I am amazed how little brain matter this people play with.

Sun, 06/12/2011 - 19:19 | 1363661 IdioTsincracY
IdioTsincracY's picture

There are better ways to stimulate the economy:

"When Henry Ford announced Five-Dollar Day in 1914, it created a sensation. Overnight, the Ford Motor Co. would double the standard wage of automobile workers. That came on top of a series of innovations since the company’s inception, including a bonus system and medical department. By the 1910s, the company already had added the Ford Motor Band for its musical employees, a company newspaper to advance camaraderie, and a 20-acre park with sports fields, playgrounds and a bandstand.

Why did Ford — remembered for assembly-line automation, not employee empathy — create a new wage standard?

Two basic reasons:

  1. Productivity. Baffled about why workers’ output had increased so little, Ford hired a researcher who discovered that, despite its technological advances, the company was being dragged down by absenteeism, shoddy work and a 370 percent turnover rate. All stemmed from long hours of monotonous tasks, combined with low wages, poor housing and working conditions, and foremen’s arbitrary management.

    By doubling wages, Ford figured he could increase efficiency, raise morale and retain the best workers.

  2. Fairness. Simply put, Ford initiated an early version of profit-sharing. His announcement thrilled working stiffs and infuriated Wall Street. Within Ford Motor Co., it neutralized acidic relations between employees and managers.

    Muckraking journalist Ida Tarbell became convinced that Ford was giving factory workers “a chance for … a good life.”

    “I believe it is a disgrace for a man to die rich,” Ford declared. “Good will is about the only fact there is in life.”

—Adapted from The People’s Tycoon: Henry Ford and the American Century, Steven Watts, Alfred A. Knopf.

Sun, 06/12/2011 - 19:28 | 1363679 Dejean Splicer
Dejean Splicer's picture

Old Henry was correct about a lot of things. Especially his views about the lizard people....

An early warning, mostly ignored.

Sun, 06/12/2011 - 20:13 | 1363760 Spastica Rex
Spastica Rex's picture

Bravo!

Sun, 06/12/2011 - 19:16 | 1363659 anynonmous
anynonmous's picture

perhaps a metaphor for the 'recovery'

major crash at LeMans Saturday (driver okay)

http://www.youtube.com/watch?v=4jnibRyrK-o

Sun, 06/12/2011 - 19:24 | 1363675 jo6pac
jo6pac's picture

The Amerikan Ferrari team should be banned from racing, they drove me nuts last yr in the US series. Did catch F1 today?

Sun, 06/12/2011 - 19:16 | 1363660 IdioTsincracY
IdioTsincracY's picture

The truth shall prevail!

The sheeple hold the keys to the Kingdom. Consumer demand is the King!!

So I say ... fuck'em all ... 

What we DEMAND is banksters and their bitchez (i.e. politicians) be thrown in jail!!

Sun, 06/12/2011 - 19:20 | 1363665 sabra1
sabra1's picture

OT:

Ireland Seizes $7 Billion From Its Pension Fund To Boost Employment

Sun, 06/12/2011 - 19:20 | 1363666 BlackholeDivestment
BlackholeDivestment's picture

...Hey Larrry! Brooksley Brooksley Brooksley ...BORNnnnnun nun nunn nnn...

http://www.youtube.com/watch?v=gja3OwyCjXE&feature=related

Sun, 06/12/2011 - 19:53 | 1363727 Problem Is
Problem Is's picture

Hilarious...
Dennis Eckersley said heckling fans would yell "Kirk Gibson!" at him... When they weren't yelling at him to get a haircut...

So if I see Fat Larry at a book signing or something, I will heckle him like a ball player...

"Hey Fat Larry! Lose some weight! Brooksley Born! Brooksley Born! Hey Fat Larry! You're washed up!"

Sun, 06/12/2011 - 19:27 | 1363682 IdioTsincracY
IdioTsincracY's picture

.........In 1982, while still a graduate student at Harvard, Summers was brought to Washington by his dissertation advisor Martin Feldstein, the supply-side economist, to serve on Ronald Reagan's Council of Economic Advisors. Those first years in the Reagan administration were crucial in the right-wing war against New Deal regulation of the banking system and financial markets--a war that Reagan's team won, and that we're all paying for today.

After his stint in the Reaganomics brain trust........ In 1990, Lithuania, a restive Soviet republic seeking independence, hired Summers to advise on that country's economic transformation. Poor Lithuania had no idea what it got itself into. This was Summers's first opportunity to tackle a country in economic crisis and put his wunderkind theories into practice. The results were literally suicidal: in 1990, when Summers first arrived, Lithuania's suicide rate was 26.1 per 100,000 and falling.

Just five years after Summers got his hands on Lithuania's economy, life became so unbearable under the economic transition that the suicide rate nearly doubled to 45.6 per 100,000, worse than any other ex-Soviet republic in transition. In fact, it was the highest suicide rate in the world, suggesting something particularly harsh and brutal about the economic transition in that country as opposed to the others, where suffering and pain were common.

Things got so bad that in 1992, after just two years of Summers-nomics, the traumatized Lithuanians voted the communist party back into power, the first East European nation to do so--even though just a year earlier Lithuanians actually died on the streets fighting communism.

Fresh off his success in Lithuania, Summers moved to the World Bank, where he was named the chief economist in 1991, the year he issued his famous let's-pollute-Africa memo.

(Summers said developed nations should ship their carcinogenic toxic waste to poor African nations because those nations' citizens' low life expectancies----due to poverty----meant they would be deceased before they ever developed cancer from exposure to the carcinogens)

In light of all of the corruption, cronyism and devastation that have marked his career, Summers' statements about an under-polluted Africa or intellectually-inferior women no longer seem like provocative eccentricities but part and parcel of the Summers shtick. "

Sun, 06/12/2011 - 19:47 | 1363717 jo6pac
jo6pac's picture

Thanks, Amerika will soon join it's Baltic brothers/sisters.

Sun, 06/12/2011 - 19:35 | 1363688 XRAYD
XRAYD's picture

<<The central irony of financial crisis is that while it is caused by too much confidence, borrowing and lending, and spending, it is only resolved by increases in confidence, borrowing and lending, and spending. Unless and until this is done other policies, no matter how apparently appealing or effective in normal times, will be futile at best.>>

 

This is BS. The crisis was caused by Fraud, Trickery, and political manipulation - nothing to do with honest and open free markets. It is precisely because these revolving door operators are in charge, and continue offering more BS as solutions, that people have no CONFIDENCE!

Above all, the most important thing holding a society together without force is JUSTICE!

 

 

Sun, 06/12/2011 - 19:41 | 1363700 IdioTsincracY
IdioTsincracY's picture

All is well! We got our hero to the rescue:

http://www.businessinsider.com/wall-street-responds-to-jamie-dimon-ben-b...

and remeber he is the one who warned us of the upcoming crisis:

http://www.cnbc.com/id/43341962/

 

Jamie Dimon for president!!

Sun, 06/12/2011 - 19:56 | 1363730 Problem Is
Problem Is's picture

Jamie Dimon for president of Bernie Madoff's cell block...

Jamie & Lloyd, Amerika's Criminal Shoe Shine Boys...

Sun, 06/12/2011 - 19:57 | 1363740 dcb
dcb's picture

WONDER WHY THIS APPEARED NOW. PR

Sun, 06/12/2011 - 19:46 | 1363706 XRAYD
XRAYD's picture


The bottom line is that neither taxes nor spending by themselves are the most important government contribution to the investment climate; it’s the budget deficit. Consequently, a reduction in tax revenue which raises the deficit is unlikely to stimulate domestic investment because more money will have to be borrowed from abroad. Conversely, a tax increase dedicated to deficit reduction could well be stimulative, as was the case with the 1982 and 1993 tax increases. Contrary to Republican dogma, rapid growth followed on both occasions.   A big cut in the budget deficit would be destabilizing in the short-run, but a reduction in the long-term deficit would free up more national saving for private investment. But if taxes are cut at the same time, as Republicans insist, then the economic consequences are ambiguous. With federal taxes at a historical low – they are currently just 14.8 percent of GDP versus a postwar average of about 18.5 percent – it’s implausible to argue that further tax cuts will stimulate growth.  http://www.capitalgainsandgames.com/blog/bruce-bartlett/2268/what-really...

Sun, 06/12/2011 - 19:51 | 1363707 Problem Is
Problem Is's picture

"perhaps 3 of those who read the following drivel will take him seriously. Two of them are Krugman and Koo. We are taking bets as to who the third one will be..."

"Fat" Larry Summers
"Fat" Larry always believes "Fat" Larry is "brilliant"...

In crony capitalism, the elite always fail upwards...

The Peter Robert "The Rube" Rubin Principle...

Sun, 06/12/2011 - 19:51 | 1363722 Dejean Splicer
Dejean Splicer's picture

O/T but perfect for a thread about various states of delusion. Fukushima update.

---------------------------------------------------------

Kyodo: Strontium detected in groundwater — Says 240 times max limit was actually found in seawater

http://enenews.com/kyodo-strontium-detected-in-groundwater-says-240-time...

---------------------------------------------------------

6,000 Bq/kg of Cesium-137 found in mushrooms from Bulgaria — EU-wide food safety alert issued

http://enenews.com/6000-bqkg-cesium-137-found-mushrooms-bulgaria-eu-wide...

---------------------------------------------------------
Hot Particles From Japan to Seattle Virtually Undetectable when Inhaled or Swallowed
TEPCO recalculation shows dramatic increases in the release of hot particles

http://www.fairewinds.com/content/hot-particles-japan-seattle-virtually-...

---------------------------------------------------------

Sun, 06/12/2011 - 19:57 | 1363731 dcb
dcb's picture

The writer is Charles W. Eliot University Professor at Harvard and former US Treasury Secretary. He is an FT contributing editor

 

MY STATEMENT: THE WRITER IS A COMPLETE DOUCHE AND OWNED BY SPECIAL INTERESTS. HE IS A MAJOR CAUSE THIS MESS HAS CONTINUED SO LONG BECAUSE HE SOLD OUT THE AMERICAN PEOPLE TO BANKING INTERESTS AND HINDERED THE MUCH NEEDED REFORM OF THE FINANCIAL SYSTEM.

Sun, 06/12/2011 - 20:01 | 1363744 mcarthur
mcarthur's picture

Larry Summers is a fat bastard who obviously has no respect for himself therefore I will not listen to anything this turd has to say.

Sun, 06/12/2011 - 20:28 | 1363773 ILikeBoats
ILikeBoats's picture

PS from Larry Summers: "Get in mah belly!"

Sun, 06/12/2011 - 20:27 | 1363776 Seasmoke
Seasmoke's picture

The man who sold the world.....

Sun, 06/12/2011 - 20:35 | 1363780 bankonzhongguo
bankonzhongguo's picture

blah, blah, blah.

Did guys like this ever have a real J O B?

This is the same guy that parachuted into post-Soviet Russia to invent the Oligarchs.

Nice.

Until these types of assholes are cut down in the streets the dawn of recovery will not break.

Eff Harvard for giving him another fake job and eff FT for giving him a voice to spew more evil nonsense.

Its up to the people that live in the same county as these creeps to take care of business.

Sun, 06/12/2011 - 20:37 | 1363788 Tin .Cup
Tin .Cup's picture

At the same time we should recognise that it is a false economy to defer infrastructure maintenance and replacement, and take advantage of a moment when 10 year interest rates are below 3 per cent and construction unemployment approaches 20 per cent to expand infrastructure investment.

Remember "shovel ready" projects.  Nearly $2T of spending later, Larry keeps a list of completed "shovel ready" projects--- on the back of a business card.


Sun, 06/12/2011 - 20:42 | 1363790 glenlloyd
glenlloyd's picture

that there is one heaping pile of dog doo.

Sun, 06/12/2011 - 20:54 | 1363804 nmewn
nmewn's picture

When you can't cut it in the real world you go into government, when you fail there as well...there's always academia.

And as everyone already knows...government can never over fund education, there's never enough money for it...LOL...its a cosmic truth only educators understand ;-)

Sun, 06/12/2011 - 21:23 | 1363831 bigdumbnugly
bigdumbnugly's picture

peter probably ended up being a college professor and thus was born a well known axiom.

 

Sun, 06/12/2011 - 21:33 | 1363839 VegasBob
VegasBob's picture

In March 2010 I watched that fat lying bastard son-of-a-bitch Larry Summers on the Sunday morning news programs proclaiming "The economy has achieved escape velocity!"

It was horseshit then and his pronouncements now are just more horseshit.  That fat fucking prick should be hanging upside down from the nearest lamppost.

Sun, 06/12/2011 - 22:27 | 1363919 JustACitizen
JustACitizen's picture

Do the PTB want to see some real American confidence?

Do the PTB want to see some real American resilience?

Investigate, prosecute and lock-up every son-of-a-bitch that is guilty from Middle-management on up - involved in the Great Financial Crisis of the 'aughts.

Even if you do not get them all - force them to liquidate their holdings to support a corps of lawyers. All of those below that level will have an object lesson in personal ethics.

No??? Not worth it??? Figures.

Sun, 06/12/2011 - 23:52 | 1364030 sbenard
sbenard's picture

I felt physically sick after reading this! "Drivel" is too kind a word, and I'm too much of a gentleman to write what I'd like to!

Mon, 06/13/2011 - 02:35 | 1364164 nathan1234
nathan1234's picture

With shit like Summers as Advisors no wonder the US has become what it is - bankrupt!!

Mon, 06/13/2011 - 06:14 | 1364247 tradewithdave
tradewithdave's picture

Will the Summer's wash, rinse, repeat plan for the payroll tax cut and curl give your hair that volume and bounce you've been looking for; borrow... lend... spend... repeat? Your hair will look like you've lost decades when you invoke Volker into a fashionable solution to cover the gray.

Sure you use the most expensive confidence in the world... but you're worth it.

http://tradewithdave.com/?p=6929

Dave Harrison
www.tradewithdave.com

Mon, 06/13/2011 - 07:43 | 1364326 PulauHantu29
PulauHantu29's picture

 

"Print, Baby, print!"

Do NOT follow this link or you will be banned from the site!