This page has been archived and commenting is disabled.
The Surprising Answer For How To Handle The Next Recession
When economic troubles strike, policymakers are eager to do something (anything) to try to help the citizenry. But, as Prof. Lawrence H. White argues in this brief clip, government doesn't necessarily know how to relieve economic woes, and in fact, often wastes and mismanages resources. Individuals in the market know better what they need in their circumstances, as economist Friedrich Hayek argued during the Great Depression. Critically, he points out, relying on government to fix our economic woes instead of allowing individuals to make decisions for themselves means putting all of our eggs in one basket. Individual decisions in the market won't be mistake-free, but each individual mistake will be smaller and will correct more quickly. The unusually slow and painful recovery that we have seen in this recession surely points to problems with the "government should do something" view.
"Who in his right mind would suggest, 'do nothing'?"... hhmm
»
- 15397 reads
- Printer-friendly version
- Send to friend
- advertisements -
Buy a horse.
Eat a horse.
After Beauty Queen Yellen takes over, there won't be Recessions anymore. Stud Bernanke made sure of that.
Richard Koo: http://finance.yahoo.com/news/richard-koo-cant-anyone-refute-125046383.html
Recessions, no.
Depressions, for sure.
Stagflession.
Lining up for $100 bread while holding a worthless iCrap, hoping for free wi-fi, to read how your government loves you.
God bless Larry White, heartless bastard that he is. I've known Larry through a student of his and have seen him at several meetings. The man actually thinks that people ought to be able to take care of themselves and that people have higher self-esteem when they do. He even believes they make better decisions than a faceless bureaucrat...imagine that! Krugman needs to give Larry a good talking-to.
I don't often agree with Koo's prescriptive work, but his descriptive work is pretty solid.
Your name fits you well.
Be a Horse
In skateboarding, an occasionally used TLA is 'ABD,' for a trick that has 'Already Been Done' at a spot.
So now what I meant to say makes sense: "Kerry got the ABD on that shit forevers ago dawg."
Buy... Eat...hmmm.
BEat a horse.
Ohh BTW...
FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA!
FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA!
FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA!
FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA! FUCK YOU NSA!
Guess who just made their watch list?
Fuck you, NSA.
Unless his name is on one of the servers that blows up and takes the backup farm with it.
Hard to say.
Give the NSA some credit- They are the only Government Agency that really listens to us.
Though Processor, that is hilarious and so not funny at the same time. My favorite kind of comedy. +100
Do nothing? DO NOTHING? Ben's entire academic and proffesional life is based off that doctorate thesis. Why if we just did nothing then that would mean he was wrong, and the Bernanke is never wrong.
"The Surprising Answer For How To Handle The Next Recession"
1. Negative Rates.
2. Devalue the US Dollar even further.
3. Start a war (for real this time).
4. FED Retires UST purchases.
5. Marshall Law.
5. FEMA Camps.
There are a lot more steps available to them.
This shit could go on forever. But soon it won't be called a Democracy anymore (did we ever have one?).
To answer your last question, no, we have a Republic.
Marry a horse
Marry a baboon
Marry a whale
Marry a cow.
Marry a fox.
Buy Gold and Silver.
But, if you're a really smart-n-savvy person, it's much better to put everybody's eggs in one basket when you have access to the basket first.
Too bad none of the semi-autistic economists can tell the dumbasses how to spot the sociopaths who own the egg basket.
Oh well, we're "doomed" to giving the sociopaths all the eggs.
Print another 7 trillion and hand it out to the muppets.
Then, like Shrub, tell eveyone to "go shopping".
LOL
If the 7 trillion was actually going to the muppets, that would be an improvement over the current situation. It would still be the wrong policy, but at least the plebs would be getting paid.
It is because of government "safety nets" that workers don't feel compelled to save and instead rely on UE or disability benefits...rely on welfare...rely on SS, medicare, Obamacare because they fail to save...become utterly reliant on others rather than self sufficient. blah blah blah...we became socialist a while ago and this seems to be what the majority wants / likes. I (we) are the odd men/women out.
The nation no longer values saved capital (delaying wants / desires), banks don't want or need capital from the populace and offer negative real interest (assured losses) on your "savings" as banks get all they need from the money creators...
Corporations spend massive time and effort determining how to game the tax system, create regulatory loop holes only they may use, game the import / export regulations...spend massive time and effort streamlining but spend less and less time on truly innovating, creating, growing.
A whole generation has been taught debt is good, saving unneccessary, greed is good, money (regardless how it's made) validates a person, and that government can do whatever as it's "money" literally comes from nothing.
What some work a lifetime to build and grow or save is literally granted by fiat to others sucking on the teat of the money creators...skimming a percentage of everything for nothing. The disparity of the means is a crushing blow to positive entrepreneurs and dreamers...I guess this is why all the smart young men/women know to go to Wall Street or DC where the "money" literally comes from nothing. The moral hazard that the best way to get ahead is to become part of the minority bilking the majority is so contrary to how this all began.
It isn't the safety nets that cause people to misbehave or otherwise not act in their own best financial interests. Rather, this trait is something inherent in humans... You can look at countries who don't have the safety nets and see the same type of irresponsible behavior. More accurately, the safety nets simply amplify an inherent trait, but they do not create it.
I don't disagree but there is a difference between charity and handouts when it comes to safety nets.
Make a decision for myself? WTF would I want to do that when so many people are willing to do it for me?
Aye...there's the rub.
TPTB don't want individuals to choose.
How else do you charge someone $12 per month for holding their money while keeping them in debt serfdom making lobster bisque and cleaning toilets for you?
I'm wondering how big a crisis has to be until the Fed starts monetizing dildos.
I got news for you - there won't be a next recession. It will be a collapse.
Re cess de press co lapse ri ots War.
How does the fiscal conservative middle and lower class policies go galt?
You don't (as well as anyone else). That only serves to make things worse for everyone else, yourself included.
Recession, LOL.
exactly. its a depression that LOOKS like a recession thanks to 800 billion dollars a year in deficit spending. lets take that 800 billion out of the equation and see where the u.s. stands, eh?
Government is not necessarily the problem -- the problem is a government that has been captured by the oligarchy,
Re: Government is not necessarily the problem
Agree. But the problem is how do you keep the Red and Blue Team true believers - who are the majority - from creating an authoritarian crony-capitalist / crony-socialist society?
The childlike Libertarians and Socialists think you can do with goofy-ass economic moralistic rules - which the sociopaths never follow anyway - which is why we're here.
Surivial of the fittest, bitchz!
How will I handle the next "official" Chalky recession? Easy; I refuse to participate.
http://vegasxau.blogspot.com
That's how it gets worse.
The surprising truth is that we are still in the last recession if you know that all the official inflation rates and hence the official US GDP numbers are fake.
Re: The surprising truth is that we are still in the last recession
Not if you're part of the top 20%. There doesn't have to be ONE economy just because there's one country.
The top 20% are doing really well actually. It's the dumbasses in the bottom 80% that will never recover.
"When economic troubles strike, policymakers are eager to do something (anything) to try to help the citizenry."
really Tyler? come on, you know better...
unless of course by help you mean defraud, rape, oppress, steal from, lie to, deceive, abandon, criminalize, control, spy on and occasionally murder.
well then you would be correct.
OMFG...did i just hear someone using common sense?
someone help me up...
George Mason actually has quite a few economists who make sense. You should hang out there more often.
We never left the fucking depression.
Short memories and short sightedness all around.
We're on a multi-trillion-dollar fiat raft that's on an ocean of shit, and the raft's starting to get soggy.
Stinky too.
This video should be banned. Obama said so.
this guy is missing step 1.
Shake free of the FED!
then the rest would stand a chance.
There's PLENTY the Gov can do and SHOULD do: Either wipe out cartels or keep them on a short leash!
QED. Questions? / Here all week. Try the salad. /s
No "either" there. They should have been wiped out 4-5 years ago. Instead, they're writing legislation that "regulates" their business, i.e. keeps competitors from getting big enough to be a threat to them. There is no keeping them on a short leash. Rein them for the time being, and they will only wait until they can reassert their dominance. It is part of their nature, and their nature is insidious. They are slavers of an subtle sort: The sort that convinces us that we are not slaves. As long as they exist, they will keep us bound through usury, seigniorage, regulatory capture and a mistaken belief that we should pay our debts to their unethical and unsustainable system.
They are enemies of liberty.
Re: Instead, they're writing legislation that "regulates" their business, i.e. keeps competitors from getting big enough to be a threat to them.
That's exactly what the railroads did when the railroads created - through their lobbyests - the ICC; which they offically hated but unoffically loved, because they got to "regulate" themselves.
The smart-n-savvy people are pretty smart-n-savvy when it comes to screwing dumbasses.
Never happen. The latest example of "Big Brother" knowing best is the ACA. All these people who thought they could keep their high-deductible health care plans are finding out that they can't. The only plans ALLOWED are ones which offer a certain level of benefits (neither too low nor too high - but JUST RIGHT). Those corporations that offer plans with benefits the bureacrats don't deem "sufficient" are forced to drop them. Those unions that offer plans which the bureaucrats deem "excessive" are forced to drop them as well.
1920-21...
http://www.fee.org/the_freeman/detail/the-depression-youve-never-heard-of-1920-1921#axzz2iZ7Tr9yL
The problem is that "the market" has historically only been able to re-organize itself back into a trajectory of further growth after depressions end. This is what solves the unemployment problems that plague recessions. Now, unfortunately, due to Peak Resources and a few other factors as well, growth will not resume and we will instead see economic contraction; much more than we're currently witnessing as the US trade deficit ends in the near future. This time really is different. Therefore, "the market" will not be able to provide jobs for enough people, and without government assistance they will starve. So this time, the government really does need "to do something". Not that they really know what to do, mind you, since they are as clueless as our economic leadership is.
Re: This time really is different. Therefore, "the market" will not be able to provide jobs for enough people, and without government assistance they will starve.
You've answered you're own question.
History shows that when people starve the follow events take place
1) Sociopaths promise to lead the people to glory
2) The people who have all the loot attempt to bargan with the sociopaths to preserve as much of their loot as possible.
3) There's lots of chaos as the physical energies of #1 and #2 play out, resulting in lots of dead dumbasses.
4) Socialism or Fascism results.
If the top 20% were wise they'd redistribute their loot now to prevent #1, but being smart-n-savvy doesn't NOT mean you are wise.
Your view of history is flawed.
misprint:
"... government doesn't necessarily know how to relieve economic woes, and in fact ..."
should read:
" ... government necessarily doesn't know how to relieve economic woes, so of course ..."
Im tired of hearing this line, individuals know better. Thats not accurate at all. The fact is, government is more likely to commit fraud on behalf of others. Where if the individual screws up, its all on them.
The entire population of the planet is just a collection of individuals. I don't think a person who is in the private sector and has no responsibility towards the general public is more likely to serve the interests of the people than a politician.
Politicians often use the private sector to work on govt projects, often idiots, sometimes referred to as Experts.
Doing nothing = No chow for for the connected snouts in the trough. It'll never happen :)
"The unusually slow and painful recovery that we have seen in this recession surely points to problems with the "government should do something" view."
It does and it has. The economy rebounds all on its own, without any help.
The 1921 recession was deep and sharp, but there was no intervention and the economy rebounded sharply as a result, with in 18 months. The intervention is preventing the market from clearing, and thus is maintaining an abatross around the neck of the economy.
Likewise, when the DOW fell 20% in 1998, Greenspan should have allowed a recession to follow, and clear out excesses, rather than goosing the economy with his 3/4 point rate cut, which added to excesses. In 2001, the economy wasn't allowed to properly correct, either.
Excesses added to excessses, creating an even larger excess to be corrected. The digging a deeper hole theme. They still can't learn to stop digging.