Krugman: “Growth in the Latter Half of this Year”

Paul Krugman – whose points and comments are valued the most from a vast majority of people, myself included – on his speech at Un. of Cincinnati, said he expected to see recovery from late of 2009. Among other things, Krugman mentioned “there are two kinds of recessions that are bad – those that take place because of financial crises, and those that are synchronized around the world,” he said. “In both cases, the recessions tend to last longer and be deeper. Right now, we’ve got both going on.”

Moreover, he criticized Obama’s recovery plan claiming it only mitigates risk. It will diminish the depth of the slump rather than drive us to actual recovery. He also expressed his concern on the lack of global support (i.e. stimulus plans). This is a synchronized recession and demands co-ordinated action on an even scale.

Finally, on a question “what will it take to pull out of this crisis”, the Nobel Prize winner replied; “this looks like the kind of slump that has all the markings of where normal recovery forces are very, very weak. [..] Almost always the way a country recovers from a financial crisis is with an export boom. The problem is that we have a global crisis this time. So who are we going to export to, unless we find another planet to take our stuff?”

(Would Mars be interested in buying any of these toxic assets?!)

by The Self-Seeker