The Ultimate Krugman Take-Down

Tyler Durden's picture

Forget Ali - Frazier; ignore Santelli - Liesman; dismiss Yankees - Red Sox; never mind Silva - Sonnen; the new undisputed standard by which all showdowns will be judged happened in Spain over the weekend. During a debate on Europe's crisis, Pedro Schwartz (a mild-mannered Spanish 'Austrian' economics professor) took on the heavyweight Paul 'I coulda been a Fed Chair contender' Krugman, and - in our humble opinion - wiped the floor with his Keynesian philosophy. From the medicinal use of more debt to fix too much debt, to the Japanization of world economies and the demand-side bias of every- and any-thing - interested only in the short-term economic growth; the gentlemanly Spaniard notes, with regard to the European crisis, the fact that "Keynesians got us into this mess and now we have to sacrifice our principals so that they can get us out of this mess". Humble and generous in his praise - though definitively serious with his criticism - Schwartz opines: "Often Nobel prize winners are tempted to pontificate on matters that are outside the specialty in which they have excelled," noting "the mantle of authority whereby what ever they say - whether sensible or not - is accepted with resignation from some and enthusiasm by others." Krugman's red-faced anger is evident at the conclusion as he even refused to shake Schwartz's hand after the debate.

For 15 minutes of both education and entertainment - this is as good as it gets...

  • Starting from around 35:00 the Spanish professor praises and criticizes in a thoughtful and gentle tone
  • At around 39:00, he addresses the demand-side description of the world
  • Krugman's less-than-happy response (which sparks quite a rowdy argument) begins around 48:20


(h/t Jean Luis Martin of the Truman Factor)

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AnAnonymous's picture

Krugman is the personification of one of my favorite phrases... "He can dish it out, but he can't take it."

Krugman is a US citizen and therefore behaves like a US citizen.

US citizens can dish it out but cant take it when their US citizenism is questioned. They have to run away in a fantasy/propaganda land to avoid facing the reality of US citizenism.

post turtle saver's picture

If the US wants your opinion we'll give you one then bomb it out of you.

destroyer of moonbats's picture

i phukin hate krugman.

Freddie's picture

Paul Krugman - so bad he makes Geithner look good.

FleaMarketPete's picture

Well-fed Krugman seemed to be a ZH deer in headlights and didn’t know whether to cut rates to -5.0%, promote his book, or declare WWIII on hard working northern Europeans.  Back to the ZH theme of dangerous “economists”, listen to all of the Obama/Krugman supporters for endless spending and authoritarianism next time he’s on CSPAN and it will scare the shit out of you.

Professor Schwartz was very respectful and concise; Krugman’s Kool-Aid is not just impalpable but poisonous and extremely dangerous. These “experts” are killing people.

devo's picture

Moral of the story: they gave a Nobel Prize to a guy who doesn't understand velocity or bonds.

Seer's picture

Policiticans are fucked up.  Economists are fucked up.  And the captains of industry are fucked up (from

A quarter of Wall Street executives see wrongdoing as a key to success, according to a survey by whistleblower law firm Labaton Sucharow released on Tuesday.


In a survey of 500 senior executives in the United States and the UK, 26 percent of respondents said they had observed or had firsthand knowledge of wrongdoing in the workplace, while 24 percent said they believed financial services professionals may need to engage in unethical or illegal conduct to be successful.


Power corrupts.  Who would have known! </sarc>

Escapeclaws's picture

Interesting point you make. The role of corruption in this crisis was not addressed by anyone. It is as if they side-step the central issue. To quote Krugman, "The dog that did not bark..."  Indeed. Economics is "but a clanging cymbal" because it complety ignores the take-over of the state by the Wall St mafia "cymbalized" by Mr. Jaime Dimon with his presidential cufflinks.


Peter K's picture

Krugman's responce is classic: Correlation=Coincidence=Causality.

But Keynes must always be right. So said the Lord :)

OldPhart's picture

shit, my spanish is white guy getto, these fluent fast-talkers have me picking out words and phrases.  I could swear however, I heard the third speaker mention capitol hill, krugman and al capone in the same phrase.

Wish this had a translator or subtitle to what he rattled off.

gorillaonyourback's picture

Goddamit where is the translation

DavidC's picture

What, from the English to the English? get to right point in the video and it's in English!


Coldfire's picture

One can only hope that all right- (that is Austrian-) thinking men in Spain would "sacrifice [their] principals". It's high time for some principal-sacrificing in the EU. Calling Madame DeFarge, calling Madame DeFarge...

Hobbleknee's picture

The Spanish debaters are so well spoken.  Then comes Krugman with his whining rebuttals, and he can't even take his fat ass to the podium.

AnAnonymous's picture

That is their part.

US citizens work in duos.

The US citizen spanish calmly backstabbed Krugman.

And Krugman got infuriated. The free press media circus.

Both sides know that in US citizen economics, going deeper into debt is not done to cut down on debt but to maintain and increase consumption.

In a finite world, this economical approach comes with consequences. Mainly that you commit yourself to never repay the physical debt.

It is big and cant be confessed.

And therefore, none of these US citizens will debate of the efficiency of the current policy in achieving that objective.

Hegelian dialectics.

Hillbillyfreak's picture

What may be of interest and what you are not aware are the words of the gentleman who introduces the kind prof that speaks after krugman.  Being a worldly sole that has been trained to speak many languages, let me translate for you a bit of  his introduction:  "Thank you Mr. Krugman for your very illuminating words, you pompous American ass.  It is because of your economic policies that the Spanish people are about to take it up the butt.  At the hands of the f'ing Germans no less.  With a woman leader.  You friggen a hole krugman.  You will be lucky to get to the airport you bastard.  Now, the Greeks don't care about taking it up the butt, but that is their problem and I am not here to judge.  But, the Spanish are a proud people and we are not going to take your crap.  Don't take my word for it.  I will now introduce the kind prof who also thinks you are a pompous ass and he will put you in your place."  That's my translation and I think its pretty close.  The part about the Greek people may be off a little; the audio went bad right there; but, that's what I heard.   

El Yunque's picture

What a waste of space.

Not a person on the planet actually doing anything PK advocates.

So why does everyone get their knickers in a twist over that shit?

falak pema's picture

"Keynesians got us into this mess and now we have to sacrifice our principals so that they can get us out of this mess". ...

I find this statement difficult to reconcile with reality. It was supply side Reaganonmics and deregulated finance that got us into this mess. Admittedly the laxist Greenspan monetary policy and demand side consumer boom of CLinton/GWB years got the US into mega trade deficits and growing debt, fed on military adventurism and NWO,  as all industry had increasingly been outsourced. But the economic model that was created in the 80s was what accelerated the Friedman model of post BW revoke floating rates USD fiat model and USD crazy print hegemony to recycle petrodollars of the 70s. Demand side died with Reagan-Thatcher and supply side took over in the 80s. It was NOT Keynesian economics from then on. 

Now that we have the supply side fed inordinate financial bubble of R.I.S.K model asset levitation, obviously the SAME banksta clique who created the model have done a U-turn and gone UBER keynesian in their desperate attempt to feed the fiat pump and try get us out of the mess by pressing on the demand side accelerator. All the while exacerbating further the asymmetric first world deficit BRIC world surplus divide, which macroeconomic wise is unsustainable.

In a depression days the whole world becomes Keynesian as nobody wants the pain of attrition to pay for their past sins. 

If what ZH and the Austrian school maintains is the right policy were to be put into practice it would mean the END of the crony politico-oligarchy systen that has been built over thirty years in first world. TPTB will never accept that. That is the bottom line. The rest is theory. This is first and foremost about POWER; like in Kaiser Wilhem/ Pax Britannia/ Romanov pre-first WW days.

Nowhere to run except print to infinity to avoid the inevitable. 

AnAnonymous's picture

If what ZH and the Austrian school maintains is the right policy were to be put into practice it would mean the END of the crony politico-oligarchy systen that has been built over thirty years in first world. TPTB will never accept that.


TPTB? That means the US citizen middle class, right?

Because US citizenism has been about cronyism from the start.

It is funny how US citizens love their fabled past story.

For some the disturbance started 30 years ago when the world started to show its finitude by the way, for others, the disturbance started in 1913 etc

Funny. Because US citizenism has not changed. US citizenism has been a story of cronyism from the start, it has been a story of affirmative action from the start

US citizens lament the loss of something that has not lost: US citizenism.

akak's picture

Toad the wet sprocket and bite the wax tadpole.

Tirpitz's picture

"It was supply side Reaganonmics and deregulated finance that got us into this mess."

In modern times of shortsightedness, luckily way too many sheeple conveniently tend to forget this root of our economic catastrophe.

post turtle saver's picture

That's funny, I don't recall Glass-Steagall being repealed under Reagan's or Bush Uno's administrations...

<church lady voice>Could it be... CLINTON???</church lady voice>

I think we need to re-enact Glass-Steagall but under a different name... I'd call it "Steven Steagall". You breaka da rules, he breaka you face.

Tirpitz's picture

Turtle, you're so right - I must have overlooked the fact that it was Clinton buddies Phil Gramm and Jim Leech, two beacons of sound Democrite politics, who were the driving force behind pulling Glass-Steagal for good.

As of Reagan vs. Clinton, I keep wondering which of both had inherited a bloated governement system and streamlined it to leave his successor some handy surplus.

That said, I'd have them hanging side by side, as they all are tools of the Trilateral group.

AnAnonymous's picture

This is how US citizenism killed debate.

US citizen Krugman is doomed to fail. Why? Because he cant discuss US citizenism as it is. Showing flanks to cheap shots.

Hence the story of getting deeper into debt to go out of debt.

US citizens do not wish to get deeper into debt to go out of debt.

They want to go deeper into debt to keep consuming as much as possible of a finite world. This is the aim and going deeper into debt works toward this objective.

But US citizens can not state this. That would be self indiction. And self indiction is a big thing in US citizenism.

As US citizens work in duo through hegelian dialect, another US citizen jumps in and provides diversion, by underlining how stupid the idea of getting out of debt by going deeper into debt is.

And the circus is started, with emotional answers.

Both the US citizens have served US citizenism, as the priority is to hide that US citizens are working at depleting the world's resources and that to achieve such an objective, debt is a powerful tool.

You will find the same scheme in many US citizen 'debates'

No matter the level by the way.

On this site, you are provided with countless examples of the same scheme

one US citizen says we have to go deeper into debt.
Another answers that you cant get out of debt by getting deeper into debt.

The fact is that US citizens can not state what they are using debt for: maintaining or increasing consumption.

And this is a US citizen behaviour as shown by both the vid and this site. This is how US citizens congregate and organize to divert the attention from their core objective.

Escapeclaws's picture

You really ought to be seeing someone.

AnAnonymous's picture

I am seeing US citizens.

The depiction of their behaviour is what it is.

akak's picture

And I am seeming one particular and insanely bigoted, one-note Chinese Citizenism citizen.

The depiction of his monolizing of the speeching means and continual conversational blobbing-up is what it is --- the crustiest bit, the definite something.

geno-econ's picture

No discussion at all about role of multinationals in global trade.  Job loss is a direct result of their outsourcing with no national allegence.  Combined with international banks, there is absolutly no regard or sympathy for workers. And they get all the tax havens to boot   Something wrong that will not be rectified by printing fiat

Jus7tme's picture


>>Krugman's red-faced anger is evident at the conclusion as he even refused to shake Schwartz's hand after the debate.

Hogwash. Having a red face is not a sign of anger or anything else. It just means the person has a red face.It is slimy to use this against Krugman.

If you have nothing better on Krugman than complaining that he has red skin in his face, that show exactly how weak your arguments against his views are.


GernB's picture

Ok then, how about his advice in his article Stimulous Math that predicted 5-6% employment given a 600 billion stimulous. We passed one a year after the article that was 787 billion, then built it into the baseline budget every year since. Thats three 700 billion stimulous packages and employment is not comming down. On top of being wrong he lies that he told us the stimulous was too small, when he knows full well they passed one larger than he asked for, and continued it each year as a part of the baseline budget. He's deliberately attempting to decieve.

Jus7tme's picture

Ok then, ..

What, since the  argument in the article are bullshit, you are going to try another one? Okay...

How about his advice in his article Stimulous Math that predicted 5-6% employment given a 600 billion stimulous

What you say just isn't true (meaning it is a LIE): He said the stimulus had to be AT LEAST 600B. And in fact we did not have even a 600B stimulus, because a large portion of the "stimulus" was not stimulus (spending) but tax cuts for the the rich and for corporations.

Krugman was completely right in the debate, and he won it.

Criticizing Krugman for having red skin, or falsely praising Schwartz for his "style" is typical right-wing bullshit.

Krugman should have gone for the jugular, though. He is much too polite with these crooks.



GernB's picture

No, you are just wrong. The Amreican Investment and Recovery act, passed only a few months after Krugman's prediction:

was 787 billion. It doesn't matter that it was the Bush stimulous he was talking about. It meets the criteria he claimed was needed and the number was in part chosen because of his and other economists urging that it needed to be that big. It didn't do what he said. Yet he continues to claim the stimulous was too small and that's why it didn't work. Apparently he was successful in getting the guillible to belive we never had a 787 billion timuous for "shovel ready jobs." etc.

All Krugman did in the debate is insist he was right. His insitance is based on cherry picked evidence, such as that in his book.

For example, his insistance in the debate that the stimulous spending was one time and pointing to examples of programs that have been cut back, as if that were all programs, is a typical example of his cherry picking examples to make a point that cannot be substantiated by the broad facts. The US outlays the year of the 2009 stimulous were 900 billion more than two years before. Spending in subsequent years has only been about 100 billion less. So the stimuolous has become a part of the baseline budget. 

So do you think Krugman is just ignorant that spending has stayed up since the stimulous, as he claims in this debate, or is he lying. 

Even more damaging is that his claim that the stimlous was too small and that's why it failed is a lie of stupendous proportions, in light of his prediction of the effect of "at least" 600 billion, and the nearly 2 trillion in spending above 2007 levels that have taken place since he made that predicion.

Regardless, I choose to ignore him because a casual investigation into the actual facts is all it takes to systematicaly dismantal 90% of what he claims.


Jus7tme's picture

I'm going to correct myself:

What Krugman said that the stimulus needed to be at least 4% of GDP == 600B for the ONE YEAR of 2008. Krugman himnself explains that here:


>>No, you are just wrong. The Amreican Investment and Recovery act, passed only a few months after Krugman's prediction:

ARRA was a multi-year stimulus of 787B, of which 288B was tax break and not real spending. Hence there was 787-288=499B of stimulus spending, and it has been spread out over over 4 years now. So you cannot truthfull claim "oh they spent 600B but unemployment did not reach the predicted lower level"

>>So do you think Krugman is just ignorant that spending has stayed up since the stimulous, as he claims in this debate, or is he lying.

I'm sure Krugman is not lying. I'm on the fence about whether YOU are lying or just being blinded by the lies of right-wing propagandists. I'm pretty sure that you WANT to believe the right-wing propaganda, though.

BotMightFly's picture

  Lauren Lyster hosted Steven Keen,

You can see his Cambridge Lecture.  Keen's book is called Debunking Economics - presented from a mathmatician's perspective.  Keen clearly demonstrates how Krugman's model omits reality.

Paul Krugman took a nosedive.

pcrs's picture

It must be frustrating for people who go through the trouble of intellectually debunking schills like Krugman, to notice after all this effort their opponents do not lack intellectual rigor but moral integrity. He just represents his masters in government that wants him to say:print, print, print

It is not an intellectual problem: They run a monopoly of the initiation of violence

GernB's picture

Typical Krugman, we havent had three examples of how these theories play out, but dozens: japan, Greece, Spain, The US, all have tried massive stimulous on a scale never seen in history, and we are on the brink of economic ruin. The US has had a stimulous larger than Krugman said was needed, year after year niow because it has become part of the baseline budget, and its making things worse and we are moving towards loosing our reserve currency status.

Even in the examples he gives, hes wrong. Ask spain what interest rates are (because Spanish bond rates cant be rigged by a central bank), look how much gold has risen in value, how about our stock market which inflates witb each new round of QE and the Fed takes credit for the inflation. What kind of crack is Krugman on.

Jus7tme's picture

Pedro Schwartz (a mild-mannered Spanish 'Austrian' economics professor)

Mild-mannered? Pedro Schwarz was rude as hell.

the Spanish professor praises and criticizes in a thoughtful and gentle tone

His tone was rude, and he completely misrepresented Krugman. Nevertheless you claim his tone was "thoughtful and gentle".

But why are you preoccuopied with his supposed "tone" in the first place? Would it not be the substance of what is said that matters? But there was no substance, and the tone was rude, so you are trying to influence the public opinion by claiming that Schwartz had good tone. The tone was bad and the substance was weak.

Krugman (or was it Brad deLong) coined the catchphrase "Liberals are shrill" to describe the phenomenon that right-wingers will accuse liberals of being "shrill" when the liberals are correct and the right-wing cooks have nothing else to argue than to attack the appearance of the liberals. This debate is the perfect example of the "liberals are shrill" tactic.

Lebensphilosoph's picture

Your thought processes would be hilarious to a disinterested observer if they weren't such a sickeningly common example of how the human brain works when it has been programmed according to some bizarre ideology. How you see in your tunnel vision is no different to how the Christian sees when he thinks the creationist has won the debate.

Escapeclaws's picture

You really do seem to be one sandwich short of a picnic. Why don't you enlighten us with your Lebensphilosophie? Evidently you think being Christian is some bizarre ideology. Let's hear you come up with something with positive content (meant as something substantial as opposed to vacuous, not as something pollyannaish) rather than continually putting others down with your warmed-over orthodoxy. What exactly is your take on this debate?

Tirpitz's picture

Good observation! Actually Pedro had a few good arguments (like sound money), just Krugman's were better where it counts, and evidence is on his side (see PIGS contraction as effect of extreme austerity for the masses, but not for the banks). While I have little sympathy for the so-called right-wingers, I do understand that it is hard to argue when being out of intellectual ammo.

Escapeclaws's picture

I don't think Krugman addressed the whole matter of Japan following his advice at all. That, more than anything, gives the lie to his analysis, if it can be called such. Nor did he address the problem of serial bubble-blowing that has bankrupted the US. He did not adequately respond to the question that inflation is theft, and Schwarz correctly zeroed in on the hypocrisy of his answer to the question posed by the Spanish lady.

Tirpitz's picture

So his recommendation to go along with 3% - with which I would disagree - wasn't an acceptable answer? I certainly would have argued differently, but I don't have a noble price to defend either.

Japan's "stimulus" mostly went to save some over-leveraged, well connected banks, and not to create work and income for the citizen. Somehow this sounds familiar, eh?

Escapeclaws's picture

His answer of 3% completely ignores the fact that inflation has decimated the value of the dollar and has wrecked the lives of those living on fixed incomes, such as retired people. They are now getting hit two ways because the price of necessities is inflating while the interest rates are so low that they are forced to invade their principal to survive. This is why I feel Krugman's answer was hypocritical. He just trotted out the unemployed as a cheap way to make a rather bogus point.

Tirpitz's picture

The discussion happened in Spain. Spain's foremost problem might be how to get the 25% print in unemployment lowered.

Getting some overweight retirees a bit back into shape might be a price Krugman is willing to pay. Spain is home to many well-fed euro retirees.

jmcadg's picture

Is there a more deluded person IN THE WHOLE WORLD than Krugman?

Just to para phrase 'I can't hear you, I can't hear you, I'm ALWAYS RIGHT, (then in Krugman's brain a voice says, say it again, say it again) I'm ALWAYS RIGHT.

(there you go, everyone clapped, you're right buddy). WTF.

By the way, to be fair, Schwartz did run Krugman down somewhat, but then so he should because Krugman has eaten off the top table for four years, when he patently only deserves to be looking through the window wishing. Don't worry Schwartz, it was a fantastically insulting put down and very well observed. You can sleep with your conscience.

janus's picture


i had an awesome post almost completed -- then a single misfortunate keystroke and it's gone...just gone.  goddam internet..  i'd dedicated songs and sentiments to all the bitchez on bloomberg.  i blame God; and you should,'s all His fault.

we covet what we see...and janus sees quite a bit of these honies.

maybe i can recall some of it:

okay, i know i dedicated some of these songs to all of you -- some of them are tacky; but give a fuck, janus don't: (let's drink a toast to innocence...try to reach beyond the emptiness...drink a toast to Time...just for a moment i was back in school, felt that ole familiar pain) (sorry for that, janus had to include it...DAC was a huge influence on young janus.  please, for your own good, don't listen to this song nor any others on this album...friend, that ain't no jive)


enough for it's time for each and every one of you:

sara eisen, (just especially fer you!) (don't kill me, darlin...okay, do what you need ta do; janus can take it...just do it.)

awww SNAP!!! (the motion of her tiny hands/ and the quiver of the bones below/ are signs of a girl that loves/ tell ya everything ya need to know/ i can't explain it/ i feel it often/ everytime i see her face)  listen to ALL the lyrics. (do you realize?)


stephanie (rhule),

steph, i saw you get the stuffin kicked outta your boobies last week...i was conflicted.  on the one hand, i wanted to kick that meat-head's ass (janus is, no doubt, a bad-ass, but he's a bad-ass who knows his limits...i may have to hire a hit-man.  do you know any italians?  we're gonna need one of those sweaty/hairy mongoloids to find us an organized crime syndicate...that's where i'm told the hit-men hang out -- amongst the sweaty/hairy italians).  on the other hand, i rather enjoyed that shrill lil noise you made.  here's what we'll do, steph: no hit-men and no dealings with italians...instead, we'll keep gettin after it till you make that sound of curious-terror...only, we'll explore it beneath 450 count egyptian cotton sheets....sweet.

scarlett fu,

you freaked me out at first.  why? well, it's because you have one of those 'brave new world' names (you'd have to read the book to get it).  i'm over it now.  now i just wanna fuck you.  don't worry, your parents will love janus.  daddy won't mind at all.

some may say this is those i'll say that it's a brow above -- top-shelf, ole sport.  why can't i say i want a lil china-girl the best way i know how?  david bowie would approve:


goddam it!!!

i'd love to keep goin...caroline in GB; you, too, linzie janis....i'd love to savage all of you; you know, all gentlemanly-like.  but i'm catchin a bad case of indigestion.  can't focus on lust anymore.

one last parting song:

love me do,








Tirpitz's picture

"... in our humble opinion - wiped the floor with his Keynesian philosophy..."

I respectfully disagree. Having watched the entire two hours, Krugman held up quite well. And his main arguments (see 49:20) still stand after the debate:

- we don't have a supply problem, but rather a lack of demand (shops are fully stocked, while wallets are empty!),

- interest rates are near record lows despite giant expansion of money supply (ZBU near all-time high),

- sharp cuts in public spending in times of contraction won't free any capital for economic growth (as confirmed by Greece, Spain, Italy and more major economies), and

- adjustment through falling wages won't work,

while otherwise excellent Pedro Schwartzo pulled in his horns in the end.

However, in my humble view, Krugman is wrong in his view that the banks need to be rescued. Banks have created too much bad debt, which needs to be destroyed, which has become a drain on the entire society, a cancer in need of being thoroughly removed, to provide the economy with room for breathing. Let them drink what they preach, free market capitalism, and let the chips fall as they may. The governments can always rescue the savers, if the banksters are out of rigged cards to uphold their evil empires any longer.

He explains that the Spanish government cannot borrow money at reasonable rates, but if the Spaniards wouldn't have backstopped the over-leveraged banks, their finances would be in better shapes than over in France or Germany, or Switzerland.

Unfortunately Krugman doesn't address another source of the current economic malaise: the effect of exporting jobs and welcoming economic parasites from countries near and far. Spain is overrun with other Southern Europeans from Morocco and Algeria to Greece and Romania and Poland. If these creatures could be contained, the international corporations might have to forego a bonus payment or two to their executive class, but the local workforce wouldn't have to see their jobs going to undesirable cultural enrichments.

Finally, to bring public finances back into shape, it just cannot be that the weakest members of society - the working class - bears the entire burden of financing the government, while its heaviest beneficiaries can continue to avoid paying their fair share of taxes. Worldwide taxes on international corporations have to be lifted to levels of other persons with comparable incomes. Payments need to be enforced, if necessary with military force. Even if the regime of Cayman Islands loses part of the reason for existing.

Escapeclaws's picture

I have to admit that I detest the idea of bailing out the banks, even if it leads to disaster. What kind of message does it send to the bankers or the public that the taxpayer will backstop their out-and-out fraud. At the very least, these banks should have been nationalized and had their salary and incentive structure completely trashed. The other matter is, why protect the senior bondholders? They are responsible for their own investment decisions and knowingly took the risk on these so-called TBTF banks--that's implicit in being a bondholder. Low risk does not mean no risk. By the way, who invented that idea, TBTF? This slippery concept has never been adequately aired. I have a feeling it was invented by some Psyop in the CIA. How does TBTF argue against nationalisation? Instead of nationalization, we get Bank of America putting their depositors savings at risk. How is that better?

I imagine that in any case the senior bondholders would not have been put at risk under a nationalisation scheme.

Tirpitz's picture

Bondholders should go the way nature chooses for them. If (only) depositors are saved, FDIC-style, which I do promote, bond holders will be paid back according to how prudent they invested. Life ain't fair to all, and we can't make everybody happy.