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Title: Rob Johnson and Tom Ferguson on the Real Meaning of the S&P Downgrade and the Market Reaction
Source:
Naked Capitalism
URL Source: http://www.nakedcapitalism.com/2011 ... e-and-the-market-reaction.html
Published: Aug 14, 2011
Author: Yves Smith
Post Date: 2011-08-14 11:32:43 by lucysmom
Keywords: None
Views: 5379
Comments: 8
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#1. To: Badeye, A K A Stone, hondo68, Fred Mertz, Godwinson, go65, war, no gnu taxes, Skip Intro, ferret mike, jwpegler, brian s, mcgowanjm, Capitalist Eric, Mininggold (#0)
"...all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being." Sandeep Jaitly
"Classic Keynesianism" is how we got into this mess. Giving everyone who's not already on the dole, a government job, isn't going to fix it.
Obama's watch stopped on 24 May 2008, but he's been too busy smoking crack to notice.
Nope. Keynesianism is how we got to the point where we had a surplus in 2000. What got us into this mess was the counter-Keynesian approach by Bush and the GOP who cut taxes and drastically increased spending during an economic expansion. Keynesian theory says to cut spending and deficits during expansion. Had Bush & the GOP maintained or even expanded the surplus, we would have been in a very strong position to deal with the 2008 crisis.
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Go65 is correct.
"...all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being." Sandeep Jaitly
And since December governments have cut spending and jobs, while the federal government has lowered taxes and cut spending relative to GDP. Why aren't we seeing a massive recovery?
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Ummm - let me guess, because it's the wrong thing to do. Corporations and the wealthy don't need more money to create jobs, they're awash in money.
"...all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being." Sandeep Jaitly
No... We had a surplus because: A.) The GOP rammed welfare reformed down Clinton's throat B.) The GOP rammed a capital gains tax cut down Clinton's throat
Complete and utter nonsense. Let's look at the White House Office of Management and Budget numbers again. Federal Spending as a percentage of GDP: 2010: 23.6% 2011 estimate: 25.3% Spending is going up, not down.
#2. To: lucysmom (#1)
"We (government) need to do a lot less, a lot sooner" ~Ron Paul
#3. To: hondo68 (#2)
"Classic Keynesianism" is how we got into this mess.
#4. To: hondo68, go65 (#2)
"Classic Keynesianism" is how we got into this mess. Giving everyone who's not already on the dole, a government job, isn't going to fix it.
#5. To: lucysmom, hondo68 (#4)
#6. To: go65 (#5)
Why aren't we seeing a massive recovery?
#7. To: go65 (#3)
Keynesianism is how we got to the point where we had a surplus in 2000
This small group of terrorists [Tea Party members] have made it impossible to spend any money. -- Mike Doyle (D-PA)
#8. To: go65 (#5)
the federal government has... cut spending relative to GDP.
This small group of terrorists [Tea Party members] have made it impossible to spend any money. -- Mike Doyle (D-PA)
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