"We have averted utter catastrophe, but how do we get real recovery? "I would not be surprised to see flat to positive GDP growth in the United States, and maybe even in Europe, in the second half of the year."Run on sentence. ::)
Translation: "We have used the power of positive suggestion and pumped trillions of dollars into a doomed system and so far the lemmings have bought into it but how long untill reality casts a light onto how fucked we really are? I'm not too sure... maybe 5 months."
World economy stabilizing: Krugman
Mon May 25, 2009
ABU DHABI (Reuters) - The world economy has avoided "utter catastrophe" and industrialized countries could register growth this year, Nobel Prize-winning economist Paul Krugman said on Monday.
"I will not be surprised to see world trade stabilize, world industrial production stabilize and start to grow two months from now," Krugman told a seminar.
"I would not be surprised to see flat to positive GDP growth in the United States, and maybe even in Europe, in the second half of the year."
The Princeton professor and New York Times columnist has said he fears a decade-long slump like that experienced by Japan in the 1990s.
He has criticized the U.S. administration's bailout plan to persuade investors to help rid banks of up to $1 trillion in toxic assets as amounting to subsidized purchases of bad assets.
Speaking in UAE, the world's third-largest oil exporter, Krugman said Japan's solution of export-led growth would not work because the downturn has been global.
"In some sense we may be past the worst but there is a big difference between stabilizing and actually making up the lost ground," he said.
"We have averted utter catastrophe, but how do we get real recovery?
"We can't all export our way to recovery. There's no other planet to trade with. So the road Japan took is not available to us all," Krugman said.
Global recovery could come about through more investment by major corporations, the emergence of a major technological innovation to match the IT revolution of the 1990s or government moves on climate change.
"Legislation that will establish a capping grade system for greenhouse gases' emissions is moving forward," he said, referring to the U.S. Congress.
"When the Europeans probably follow suit, and the Japanese, and negotiations begin with developing countries to work them into the system, that will provide enormous incentive for businesses to start investing and prepare for the new regime on emissions... But that's a hope, that's not a certainty."
Run on sentence. ::)You are not worthy of "translating" Paul Krugman.
It's Getbig, where everyone is smarter than a MIT educated, Nobel Prize winning economist!!!! ::)LOL
Our two resident google-wizards Bindare and Samson are proof positive of that.
May 14, 2009
Op-Ed Contributor
The Almighty Renminbi?
By NOURIEL ROUBINI
THE 19th century was dominated by the British Empire, the 20th century by the United States. We may now be entering the Asian century, dominated by a rising China and its currency. While the dollar’s status as the major reserve currency will not vanish overnight, we can no longer take it for granted. Sooner than we think, the dollar may be challenged by other currencies, most likely the Chinese renminbi. This would have serious costs for America, as our ability to finance our budget and trade deficits cheaply would disappear.
Traditionally, empires that hold the global reserve currency are also net foreign creditors and net lenders. The British Empire declined — and the pound lost its status as the main global reserve currency — when Britain became a net debtor and a net borrower in World War II. Today, the United States is in a similar position. It is running huge budget and trade deficits, and is relying on the kindness of restless foreign creditors who are starting to feel uneasy about accumulating even more dollar assets. The resulting downfall of the dollar may be only a matter of time.
But what could replace it? The British pound, the Japanese yen and the Swiss franc remain minor reserve currencies, as those countries are not major powers. Gold is still a barbaric relic whose value rises only when inflation is high. The euro is hobbled by concerns about the long-term viability of the European Monetary Union. That leaves the renminbi.
China is a creditor country with large current account surpluses, a small budget deficit, much lower public debt as a share of G.D.P. than the United States, and solid growth. And it is already taking steps toward challenging the supremacy of the dollar. Beijing has called for a new international reserve currency in the form of the International Monetary Fund’s special drawing rights (a basket of dollars, euros, pounds and yen). China will soon want to see its own currency included in the basket, as well as the renminbi used as a means of payment in bilateral trade.
At the moment, though, the renminbi is far from ready to achieve reserve currency status. China would first have to ease restrictions on money entering and leaving the country, make its currency fully convertible for such transactions, continue its domestic financial reforms and make its bond markets more liquid. It would take a long time for the renminbi to become a reserve currency, but it could happen. China has already flexed its muscle by setting up currency swaps with several countries (including Argentina, Belarus and Indonesia) and by letting institutions in Hong Kong issue bonds denominated in renminbi, a first step toward creating a deep domestic and international market for its currency.
If China and other countries were to diversify their reserve holdings away from the dollar — and they eventually will — the United States would suffer. We have reaped significant financial benefits from having the dollar as the reserve currency. In particular, the strong market for the dollar allows Americans to borrow at better rates. We have thus been able to finance larger deficits for longer and at lower interest rates, as foreign demand has kept Treasury yields low. We have been able to issue debt in our own currency rather than a foreign one, thus shifting the losses of a fall in the value of the dollar to our creditors. Having commodities priced in dollars has also meant that a fall in the dollar’s value doesn’t lead to a rise in the price of imports.
Now, imagine a world in which China could borrow and lend internationally in its own currency. The renminbi, rather than the dollar, could eventually become a means of payment in trade and a unit of account in pricing imports and exports, as well as a store of value for wealth by international investors. Americans would pay the price. We would have to shell out more for imported goods, and interest rates on both private and public debt would rise. The higher private cost of borrowing could lead to weaker consumption and investment, and slower growth.
This decline of the dollar might take more than a decade, but it could happen even sooner if we do not get our financial house in order. The United States must rein in spending and borrowing, and pursue growth that is not based on asset and credit bubbles. For the last two decades America has been spending more than its income, increasing its foreign liabilities and amassing debts that have become unsustainable. A system where the dollar was the major global currency allowed us to prolong reckless borrowing.
Now that the dollar’s position is no longer so secure, we need to shift our priorities. This will entail investing in our crumbling infrastructure, alternative and renewable resources and productive human capital — rather than in unnecessary housing and toxic financial innovation. This will be the only way to slow down the decline of the dollar, and sustain our influence in global affairs.
Nouriel Roubini is a professor of economics at the New York University Stern School of Business and the chairman of an economic consulting firm.
It's Getbig, where everyone is smarter than a MIT educated, Nobel Prize winning economist!!!! ::)
Our two resident google-wizards Bindare and Samson are proof positive of that.
It's Getbig, where everyone is smarter than a MIT educated, Nobel Prize winning economist!!!! ::)
Our two resident google-wizards Bindare and Samson are proof positive of that.
You actually typed something that didn't have the word Muslim in it. Congratulations, there is hope for you yet.
You actually typed something that didn't have the word Muslim in it. Congratulations, there is hope for you yet.
It wont matter, you will still be unemployed.Speak for yourself, fat man.
Additionally, most "economists" did not see the current recession coming and laughed at people like Schiff & Roubini who called this dead on.Incorrect, as usual. ::)
Speak for yourself, fat man.
Incorrect, as usual. ::)
You actually typed something that didn't have the word Muslim in it. Congratulations, there is hope for you yet.
I am self employed.Sure you are. ::) Having an eBay account doesn't count.
Show me your genius left wing economists who were as accurate as Schiff and Roubini and maybe we can have a decent discussion. Until then, go back to your Obama blow up doll.I am not aware of an Obama "blow up doll," but no doubt your Limbaugh Butt Plug up gets plenty of use.
Sure you are. ::) Having an eBay account doesn't count.
I am not aware of an Obama "blow up doll," but no doubt your Limbaugh Butt Plug up gets plenty of use.
Funny, Roubini is a great economist but he has been wrong on many other predictions before. Even a broken clock is right twice a day.
He may be, but I am more willing to believe those who were accurate before this receission and its cause than those who are late to the game.
I personally think he's too over the top. He's carved his own little niche in the economic world by being Mr. Doom and Gloom about everything.
You seem butt hurt that no one pays attention to the 12 doom and gloom economics articles you have copy/pasted every day for the last 8 months, none of which have come true. Sorry but your credibility was annihilated when Benny exposed you for a keyboard jockey economist with no grasp of finance.
But feel free to keep insinuating that you're more intelligent than Krugman.
You are a god.
Why is it that you feel the need to go into my profile and respond to every post I've made in the last 12 hours every time I insult you? Move on with your life, you lying shill.
Because you are a bully, kid asshole. If you weren't so malicious there would be no need for it. When you stop, I too shall stop.
I've been attacking you because I'm tired of reading your depression-laced posts. This is an internet forum and nothing more. I'm not "bullying" you. It's a forum that has been polluted recently with your incessant moaning and bitching about how "woe is me" your life is right now. I'm tired of reading about it in every fucking thread. Your "you=samoan=great genetics" posts amount to nothing more than trolling. Much like you spam bombing every thread you don't like with pictures of Mexican food with the intent of derailing the threads.
Go work your thesis you miserable crybaby.
As opposed to the content of your posts, 90% of which are composed of little more than one liners and insults. In contrast to you I occasionally post things with real content and have real discussion. As I said:
You are god
People like you really piss me off. People who don't realize how good they have it. Here you are, a guy who is only 31 years old, college educated and healthy, bitching about how bad you've got it. Even fortunate enough to be able to go back to school to earn a Masters. It's pathetic. There are millions of people out there who would give everything they have to be in your position. Yet the best you can do is spam bomb a forum 300 times a day about how bad you've got it.
"Waaah, I have bad genetics." At least you can walk and work out. Your willpower and lack of confidence is embarrassing.
You make it seem like all that was handed to me for free. I worked 3 years with NO SINGLE VACATION so I could save for my MA. Fortunate? Perhaps, but 100% due to my hard work and whatever extra fortune was added.
As for the genetics...that is merely a factual statement. I have piss poor bbing genetics.
I think the article Deicide quoted is an interesting perspective (and possibility). The decline of power of several countries/great civilizations came about because of economic collapse.
We cannot and should not allow our government to continue its massive deficit spending.
In the mid 20th century there was an interesting theory brought about the stages of civilisation by Carroll Quigley, a prominent historian. He talks about the empire stage and the end stages of the empire stage itself. Many prominent scholars believe the American empire is in its death throes, that is the stage where empires merely lash out and try to take with them what they can. It is no where written in the stars that the American empire continues forever.
http://www.draftymanor.com/bart/h_quigl3.htm
6. Decay
Once it becomes clear that the bulk of a civilization's wealth has been used up, the decline is usually mercifully swift. "Mercifully," because this is a period of great distress.
During this time, as recognition of the civilization's poverty spreads, the standard of living falls quickly. Law and order break down. Civil unrest sparks protests, some of which turn violent. Taxes cannot be collected, and other forms of public service such as military service (and military actions themselves) are resisted. Property cannot be protected except (if at all) by force. Personal violence becomes a daily occurrence. Trade fails, as fraud can no longer be punished. Town life fails; basic survival needs force people into the country where they can grow food, and the "middle class" disappears. Religious revivals sweep the land. The medical technology that sustains life becomes difficult or impossible to obtain, resulting in high rates of infant mortality and shortened lifespans. Finally, literacy itself fails.
There are also many scholars that see US power increasing over the next century.
I'd like to see the writings of scholars that think the US will become more powerful....this does not seem to be the case and prominent economists have warned of the emergence of several economic superpowers battling the US for dominance. Then you have a % of liberals who believe its not right for American to be economically dominant.
You seem butt hurt that no one pays attention to the 12 doom and gloom economics articles you have copy/pasted every day for the last 8 months, none of which have come true. Sorry but your credibility was annihilated when Benny exposed you for a keyboard jockey economist with no grasp of finance.
But feel free to keep insinuating that you're more intelligent than Krugman.