Damn right. Those mean, nasty Asians, forcing moral, upstanding US citizens to buy houses, cars and holidays they couldn't afford on debt.

/ Can't believe the theory in TFA is respectable. But since Bernanke will be writing your children's economics textbooks, you might as well accept it.

// And black=white

Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people.

I blame it on their small penises.

bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people the people don't let themselves be pushed around just because someone has a fancy title.

Well, they have a point, which is that the current economy is built on wasteful mass consumption.

How to change that, I don't know, but this is the same reason why all the romantic reminiscing about the "Greatest Generation" being uber-thrifty during the Depression and keeping "Victory Gardens" during WW2 might be good for individuals, but would actually break the current system.

bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people.'

Regardless of whether they're "right", it's selfish and arrogant to make such statements. Individuals aren't required to bow to the will of those making billions speculating the market. Frugalness is a good trait, not a bad one. They're bitter because they're losing money from it. If only the world could be as fiscally conservative as those being blamed, then we wouldn't be in the mess created by a bunch of greedy farkwits

Click the first link for the whole story (new window)

itazurakko: How to change that, I don't know

Honestly, the only way to change that is to reduce the industrial capacity. We've become a consumption oriented economy because we have too much industrial capacity. Not just the US, but the world over. We can produce more than we need, but to let capacity lie fallow is wasteful. So we produce wasteful things- the people who own the factories aren't wasting, but they rely on the people buying garbage to waste it for them.

bhcompy: Frugalness is a good trait, not a bad one.

That's what I was wondering. How can one "oversave" and "underconsume"? So long as I consume enough to support myself, and am not starving, I am free to save as much as I like.

//As it is, between my wife and myself, we save over 25% of our income every year.

Well, there is the small matter of the Chinese keeping their currency artificially low, which certainly had adverse effects on American exports and manufacturing.

t3knomanser: //As it is, between my wife and myself, we save over 25% of our income every year.

And I asked myself, can T3knomanser actually get a whole post out without exhibiting his superiority complex.

Turns out, nope.

WhileAmericaBurns: bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people the people don't let themselves be pushed around just because someone has a fancy title.

Yeah... listening to people with more intelligence or education is clearly being pushed around.

Tell us, does it hurt when your knuckles drag on the ground like that? What WAS it like to be an extra in Idiocracy?

Sun Worshiping Dog Launcher: t3knomanser: //As it is, between my wife and myself, we save over 25% of our income every year.

And I asked myself, can T3knomanser actually get a whole post out without exhibiting his superiority complex.

Turns out, nope.

LOL

because it's unsustainable. That be why it bad.

Well. First and foremost that's a gross mischaracterization of what is being claimed.

Second, the main problem is quite true. The Chinese save too much. This is a VERY real problem. It's one significant enough that the Chinese government specifically announced plans to offer national healthcare and a few other social programs so encourage people not to worry about unexpected expenses. The theory is, if they no longer have to worry about paying for illness or retirement, they will spend more and push the economy higher.

Here in the United States, we have the opposite problem. People don't save enough. If the current savings rate had been done for the past 20 years, this current recession would be no where near as bad.

bronyaur1: WhileAmericaBurns: bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people the people don't let themselves be pushed around just because someone has a fancy title.

Yeah... listening to people with more intelligence or education is clearly being pushed around.

Tell us, does it hurt when your knuckles drag on the ground like that? What WAS it like to be an extra in Idiocracy?

You're going WAAAAAAAAYYYYYYYYYYYYYY out on a limb with your assessment of Bernanke and Krugman.

Got nothing to say about the actual topic, other than, "DUH!" That's the problem with bubbles - they burst. Once the bubble bursts, people lose confidence. Without confidence, people don't borrow (and lenders won't lend anyway). Everything slows back down to where it would be if we didn't have such a thing as "credit". The solution to the problem is one of two choices: a) Inflate another bubble (requiring lenders to go apeshiat with loans), or b) Stop the bubble-burst cycle and grow based on what you actually have and produce (requiring massive lifestyle reductions).

/Just started Round 3 of the "Victory Garden"
//Can't wait to eat the next batch.

t3knomanser: Honestly, the only way to change that is to reduce the industrial capacity. We've become a consumption oriented economy because we have too much industrial capacity. Not just the US, but the world over. We can produce more than we need, but to let capacity lie fallow is wasteful. So we produce wasteful things- the people who own the factories aren't wasting, but they rely on the people buying garbage to waste it for them.

Yep. Massive retail glut, too.

Though, it's a legitimate question - when 5% of the people can do all of the work (with automation, etc) - how do we decide who will eat?

Plenty of blame to go around to just blame one or two groups. Seriously. The economic implosion was a clusterfark of epic proportions. Every level of western society had their hands in this mess. All political parties. Blame:

1) Banks and other lenders and ratings firms for intentionally turning blind eyes to obviously bad risk as long as the money kept rolling in in the short term. And for packaging those loans to sell to others as low-risk investments. And to those banks for leveraging themselves to insane amounts such that, when the creditors came calling, they were terribly overextended.

2) Mortgage lenders and the housing industry for feeding the frenzy of never-ending growth, don't get in now and you'll regret it later when prices have doubled. Get rich now! Why waste the equity in your homes! For turning a blind eye to obviously substandard applicants. To the industry as a whole for creating the home-flipping insanity that seemed to be the basis for every other tv show.

3) AIG for woefully underestimating risk as long as the payments for credit-default swaps kept rolling in. And for insuring anything at all as long as the payments kept rolling in, even if the insurer had no economic interest in the entity being insured other than the payout if that entity failed. And giving out so many insurance pacts that they nearly became the crux of the implosion that would have brought everybody else down if the feds hadn't intervened.

4) To consumers for believing the codswallop they were being sold in the media and by brokers and banks. For being morons and leveraging themselves and believing that even a shack in a blighted neighborhood could be worth $800,000. And for signing and not understanding sub-prime, alt-A, and option ARM mortgages and how they'd reset a few years down the road. For thinking that anybody, even making $10/hour, can afford a $500,000 home loaded with big-screen tvs.

5) To government, for turning a blind eye as long as the economy looked good and they could say they created so many jorbs. And for complete lack of regulation over credit swaps and derivatives. And for being in bed with the banking and housing industries.

6) The Fed bank, for encouraging the whole housing boom with stupidly low interest rates for far too long.

7) The media for not seeing the storm coming and sounding warning. All the evidence was there, it was making it into the media at some sites, but the cheerleaders of unlimited expansion drowned it all out with their, well, cheerleading.

I think what we've learned from this mess is that society, even well educated and advanced, is still a herd. That lack of regulation means that the herd will stampede when they get caught up in a market fever. That the herd will intentionally blind themselves to the long term dangers of said stampede and will stampede themselves off of a cliff. That regulations to prevent this kind of thing are made by politicians who just can't be trusted to do it fairly or without making them overly burdening or without corruption.

Yeah, all sorts of FAIL to go around.

There is all kinds of fail in these comments. The Chinese do save too much. Just imagine if everyone saved more than they spent? Imagined it yet? No you haven't because it's not possible. If everyone tried to save as much as the Chinese, the global economy would slow and slow some more and then vanish - it's not possible for everyone to save more than you spend, and doing so is a beggar-thy-neighbor policy. It's time for America to start saving more and China and Germany to start spending more to rebalance the global economy

I did some research on Japanese spending and saving habits awhile back for a professor who was researching financial regulation. One of the interesting flaws in a lot of that data came from the fact that Japan actually has incredibly lax regulation when it comes to consumer loans through *ahem* unofficial channels. Further digging showed me that this was actually common practice in China, too.

So, it's not that consumers in Asia are responsible savers. Their banks tend to be enormously finicky when it comes to giving out loans to individuals. So, instead, people tend to resort to gray market and black market loans. Since it's next to impossible to collect information about those loans, data about Asians being thrifty and saving a lot of money tends to be fairly skewed.

bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people.

Nice troll.

7/10

Maybe I'm missing something. I know that 10% of Fark reads the article, but are we seriously linking to pay subscription websites now?

20 comments. How many of you have a WSJ subscription? And you're still discussing the article.

Sun Worshiping Dog Launcher: And I asked myself, can T3knomanser actually get a whole post out without exhibiting his superiority complex.

In what way does that make me superior? It means I have a lot of extra money, which is useful. But not really superior. Why does that make you feel inferior? It's a simple statement of fact, and it certainly carries with it clear tradeoffs, that most people would think outweigh any of the benefits, why, I do think that most people, looking at my lifestyle, would consider it inferior to their own.

I'm okay with that. Why aren't you?

skinsmaniac: Just imagine if everyone saved more than they spent?

Well, since we have a fractional reserve banking system, pretty much everywhere in the world, it sounds like the banks would use that saved money to invest in real estate and businesses, which would add more money into the economy, and so you'd get a gradual and steady inflation, which is the goal of fractional reserve.

What's the problem?

itazurakko: when 5% of the people can do all of the work (with automation, etc) - how do we decide who will eat?

I think that's going to be a real concern, especially as the means of production become cheaper and easier to automate. People are working on technologies that would allow you to have a small scale factory in your own home- RepRaps would cut the bottom out of the consumer economy as people would instead start consuming raw materials (mostly unfinished plastics, last I checked).

Within a decade, basic widgets will be produced at home. Within two decades, more complex electronics are likely. This will increase the demand for raw materials and decrease the demand for unskilled labor.

Nicholas Urfe: And you're still discussing the article.

There's a google-passthru linked earlier in the thread, y'know. Just a few comments in.

itazurakko: Well, they have a point, which is that the current economy is built on wasteful mass consumption.

How to change that, I don't know, but this is the same reason why all the romantic reminiscing about the "Greatest Generation" being uber-thrifty during the Depression and keeping "Victory Gardens" during WW2 might be good for individuals, but would actually break the current system.

That's the thing. We're already at 10% or more unemployment (any honest count). 10-15% of China is unemployed, too. Yet, the fast food outlets are open and Walmart shelves are stocked.

Cut back dramatically on consumption, good and green as that is, and we could get to 50% unemployment, easily, without much actually missing. Side effect of the advance of science, tech, and automation.

Lawnchair: Side effect of the advance of science, tech, and automation.

But we still don't know how to operate a post-scarcity economy. We don't have a social system in place for that, and nobody has proposed one that's really workable, unless we want to go into a command economy, but there's some serious objections there.

Lawnchair: Cut back dramatically on consumption, good and green as that is, and we could get to 50% unemployment, easily, without much actually missing. Side effect of the advance of science, tech, and automation.

t3knomanser: But we still don't know how to operate a post-scarcity economy. We don't have a social system in place for that, and nobody has proposed one that's really workable, unless we want to go into a command economy, but there's some serious objections there.

Exactly.

Right now we're keeping things afloat by basically pumping valuable petroleum directly into landfills by way of plastic doodads passing through Wal-Mart, but it's not a sane long term plan. It's not the fault of any one person, either, it's just the crazy system doing its thing as everyone tries to keep up.

Transitioning to a truly sustainable economy, one not based on scarcity or requiring a frontier beyond which to dump the trash and send off excess people as emigrants, will be a big challenge.

The Paradox of Thrift:RIP (new window)

They're both Keynesians. What can you expect?

bronyaur1: WhileAmericaBurns: bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people the people don't let themselves be pushed around just because someone has a fancy title.

Yeah... listening to people with more intelligence or education is clearly being pushed around.

Tell us, does it hurt when your knuckles drag on the ground like that? What WAS it like to be an extra in Idiocracy?

If Ben Bernanke were in the private sector, your argument would be valid. As a person in government power, though, his primary role is not to impart his wisdom to you and I, but to do as he pleases with our economy. This whole business of treating the Fed Chairman like a wise oracle is bullshiat, the purpose of which is to intimidate the people into accepting his power unquestioningly. It's like he's our Ayatollah, but instead of controlling who gets to be President, he controls the entire monetary system. It's hard to say which role is scarier.

t3knomanser:

skinsmaniac: Just imagine if everyone saved more than they spent?

Well, since we have a fractional reserve banking system, pretty much everywhere in the world, it sounds like the banks would use that saved money to invest in real estate and businesses, which would add more money into the economy, and so you'd get a gradual and steady inflation, which is the goal of fractional reserve.

What's the problem?

There would be no one to lend to if everyone saved more than they spent. You aren't seeing how it's a beggar thy neighbor policy. Obviously it's fine for one person to save more than they earn and another to spend more than they earn, but only if their roles are reversed later to rebalance the economy.

bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people.

Highly educated, I'll grant you, but if you look back at what they've both been saying over the past 3 years, it's pretty obvious they aren't intelligent.

/or they're flat ass lying

t3knomanser: Lawnchair: Side effect of the advance of science, tech, and automation.

But we still don't know how to operate a post-scarcity economy. We don't have a social system in place for that, and nobody has proposed one that's really workable, unless we want to go into a command economy, but there's some serious objections there.

YOu just need to found Starfleet and the rest takes care of itself.

Or spend the extra resources to research this:Ascetic Virtues (new window)

opiumpoopy:

// And black=white

Yes (PPops).

skinsmaniac: There would be no one to lend to if everyone saved more than they spent.

Aside from businesses, that is. Individuals should save, so that business can expand. Businesses can't expand without easy access to capital, which is made possible by fractional reserve banking, which is fueled by individuals saving.

And Americans are learning real quick.

So I was wrong to save and buy my home for cash. I'm sorry America, next time I will use credit. Plz forgive me.

Where does Krugman say anything, or where does anyone assert Krugman agrees with the statement subby put in his mouth?

AmazingRuss: Highly educated, I'll grant you, but if you look back at what they've both been saying over the past 3 years, it's pretty obvious they aren't intelligent.

/or they're flat ass lying

That's exactly it.

The excuses for not seeing the writing on the wall for the financial crisis is the same as the WMD issue in Iraq. The answers are either incompetence or outright lying, neither of which is acceptable.

Renowned transvestite sexologist: Second, the main problem is quite true. The Chinese save too much. This is a VERY real problem. It's one significant enough that the Chinese government specifically announced plans to offer national healthcare and a few other social programs so encourage people not to worry about unexpected expenses. The theory is, if they no longer have to worry about paying for illness or retirement, they will spend more and push the economy higher.

I disagree with the actions the Chinese are doing, but the thing is, they have the money to do what they are doing. They don't have to borrow a dime do enact their social programs.

We DON'T have the money. We virtually have to borrow just to cover out non-discretionary spending.

TaGirl_Keri: So I was wrong to save and buy my home for cash. I'm sorry America, next time I will use credit. Plz forgive me.

Either your living in a tent or you're pretty hard core.
If I saved up to buy my house I would have lost my best performing investment over the last 12 years and have been paying rent instead paying down my mortgage.

PirateFreedom: Very condensed version.
I saved and bought the land, lived with mom for 2 weeks til I arranged for a hired trailer moved on site. Fixed up builder I knew with $100k in advance, I pay for material as needed, rest on completion of house. Builder arranged architect & permits which took 3 months. Meanwhile I had moved into trailer, kept working at my own job of electrician. After builder finished I did all the home electrics, painting, wallpapering etc. There is still a bit to do inside, furniture-wise, and garage is a mess, needs cladding, and the garden looks like Monte Cassino, but that is next year's job.
Happy July 4
heh, hard-core Keri.

Wrong_Intentions: I blame it on their small penises.

Poor Ben Bernanke and Paul Krugman.

itazurakko: t3knomanser: Honestly, the only way to change that is to reduce the industrial capacity. We've become a consumption oriented economy because we have too much industrial capacity. Not just the US, but the world over. We can produce more than we need, but to let capacity lie fallow is wasteful. So we produce wasteful things- the people who own the factories aren't wasting, but they rely on the people buying garbage to waste it for them.

Yep. Massive retail glut, too.

Though, it's a legitimate question - when 5% of the people can do all of the work (with automation, etc) - how do we decide who will eat?

The agricultural revolutions freed up more people to make stuff like furniture, clothes, buildings, cars, etc. Further automation will free up people to do more stuff like writing books, making movies, music, and many other things that machines won't be able to help much with for the foreseeable future. Plus as things get cheaper, people will tend to work less hours as the don't need as much money as they used to for the same amount of stuff.

How come when I go to the casino, I see it packed full of Chinese betting like no tomorrow? I also find the constant playing in a local resturant of Chinese media showing military advancements in China a bit disturbing too

The phenomenon we're seeing is "frantically flailing to find anyone else to blame a crisis on."

Oh no sir! It wasn't me! Those damn thrifty chinamen! All their fault yessir.

Nevermind that we have no right or jurisdiction to do anything to change the saving or spending practices of China, only to successfully react to what they freely choose to do with their own property. So even if the "savings glut" BS were true, it was our own people who failed to respond to it; "we couldn't help it" is not the sort of excuse anyone should ever tolerate.

But we don't need to look to china to find the source of the problem, it is quite local and hasn't moved for nearly 100 years.

20th Street and Constitution Avenue NW, Washington, DC 20551

skinsmaniac: There is all kinds of fail in these comments. The Chinese do save too much. Just imagine if everyone saved more than they spent? Imagined it yet? No you haven't because it's not possible. If everyone tried to save as much as the Chinese, the global economy would slow and slow some more and then vanish - it's not possible for everyone to save more than you spend, and doing so is a beggar-thy-neighbor policy. It's time for America to start saving more and China and Germany to start spending more to rebalance the global economy

The Chinese save too much because there are no social programs like in the US.

You're fired, no unemployment.

You retire. No pension.

You get really sick. No free health care. You also get fired from your job.

You'd be insane not to save when you're making the money. Absolutely nothing is going to come your way when you don't or can't work.

Wrong_Intentions: I blame it on their small penises.

How do you know how big Bernanke and Krugman's penises are? Actually, scratch that, I don't want to know how you know that.

t3knomanser:
Aside from businesses, that is. Individuals should save, so that business can expand. Businesses can't expand without easy access to capital, which is made possible by fractional reserve banking, which is fueled by individuals saving.

And businesses will sell their goods and services to ...?

Komplex: And businesses will sell their goods and services to ...?

Anyone who will buy? One can still buy and be saving more than they spend, y'know. Plus, most businesses sell, not to individuals, but other businesses.

t3knomanser: Komplex: And businesses will sell their goods and services to ...?

Anyone who will buy? One can still buy and be saving more than they spend, y'know. Plus, most businesses sell, not to individuals, but other businesses.

All demand for goods trickles down to individual demand for goods. Companies cannot take out loans equal to say 54% of the economy and then finance them by selling goods equivalent to 46% of the economy.

t3knomanser: Komplex: And businesses will sell their goods and services to ...?

Anyone who will buy? One can still buy and be saving more than they spend, y'know. Plus, most businesses sell, not to individuals, but other businesses.

Ok, so let me get this straight, we are all supposed to cut back on our consumption to save, the savings will be borrowed by businesses to expand, so the consumers who've cut back on their spending will have to increase their spending.

johnphantom: bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people.

Nice troll.

7/10

Not meant to be a troll. Meant to be an assessment of how ridiculous it is to dismiss brilliant and educated people in favor of ideas that emanate from people who are neither brilliant nor educated on the topic at hand.

When you you have a growth on your body that you can't explain, do you listen to someone with a graduate degree in medicine from a top school, and who has been practicing medicine his entire career? Or do you trust the advice you get on Fark? It is the exact same thing.

WhileAmericaBurns: bronyaur1: WhileAmericaBurns: bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people the people don't let themselves be pushed around just because someone has a fancy title.

Yeah... listening to people with more intelligence or education is clearly being pushed around.

Tell us, does it hurt when your knuckles drag on the ground like that? What WAS it like to be an extra in Idiocracy?

If Ben Bernanke were in the private sector, your argument would be valid. As a person in government power, though, his primary role is not to impart his wisdom to you and I, but to do as he pleases with our economy. This whole business of treating the Fed Chairman like a wise oracle is bullshiat, the purpose of which is to intimidate the people into accepting his power unquestioningly. It's like he's our Ayatollah, but instead of controlling who gets to be President, he controls the entire monetary system. It's hard to say which role is scarier.

So, let me get this right.... you think that someone who got his Phd in economics from MIT, his undergrad in econ summa cum laude in economics from Harvard, who nearly got a perfect score on the SAT, who did his dissertation on uncertainty and business cycles, who is one of the world's foremost experts on economic policy choices during the Great Depression, who has chaired the Princeton Econ dept, and who spent a number of years associated with the Fed is NOT someone whose advice we should consider above nearly all others on the matters at hand?

Suggest someone more qualified and brighter and whose ideas on the real-time practice of monetary and economic policy should be treated with more respect than Ben Bernanke's.

When a developing nation goes for manufacturing the result is that cash builds up faster than they are used to spending it. While their domestic economies ramp up they must export their savings, in this case in part through currency rate manipulations, or the result is their own currency blowing up and stagnating their development. Like all such games this one eventually blows up. Lack of control of risk in the global financial system is a big part of what went wrong, but without all the Asian money sloshing around it would not have been possible to have such a huge bonfire in the first place. There is nothing particularly responsible about using currency rate manipulations to export a savings glut.

bronyaur1: So, let me get this right.... you think that someone who got his Phd in economics from MIT, his undergrad in econ summa cum laude in economics from Harvard, who nearly got a perfect score on the SAT, who did his dissertation on uncertainty and business cycles, who is one of the world's foremost experts on economic policy choices during the Great Depression, who has chaired the Princeton Econ dept, and who spent a number of years associated with the Fed is NOT someone whose advice we should consider above nearly all others on the matters at hand?

Yes, his resume is laudatory and he's very smart. However, this does not mean he is a better predictor any more than the head of the NOAA will make better weather predictions than that amateur forecaster on the local network. Krugman has made a number of failed predictions, and the philosophy he espouses of deficit-spending on anything and everything is already throwing up warning flags (he made hay of the fact that interest rates were so low at the time so we can afford it, but treasuries have already made a serious dive as a result of the printing presses being turned on, pushing interest rates waaaaay up).

Economists are historians and mathematicians at best, and the fact that so many schools of economic theory have been developed and implemented to extremely mixed success lends credence to my theory that predicting what -will- happen is as much art as science, much like predicting weather. Just like you'd be making a mistake if you ignore the 3 local forecasters who are yelling "ice rain" while NOAA is saying "sunny day", you'd also be making a mistake if you trust Krugman at the expense of everyone else. And these aren't all amateurs who are bucking Krugman, either. Even Warren Buffett, no Friedman conservative, is predicting massive inflation as a result of our spending policies.

bronyaur1: words

For a self-proclaimed "expert" on economics, you do an awful lot of name-calling and not much in adding to the debate. From the looks of the crap you've espoused so far in this thread, you've obviously never heard of the "appeal to authority" logical fallacy that you've demonstrated so clearly here.

How about some good arguments coming from you and fewer fallacies, please?

Except the appeal to authority is only a fallacy when you try to quote someone of recognized expertise's opinion on an area outside of their expertise. Example: quoting Albert Einstein on theology or Stephen Hawking on music.

Quoting either of them to back up an argument about physics is an entirely different ball of wax. See the difference?

m0llusk: When a developing nation goes for manufacturing the result is that cash builds up faster than they are used to spending it. While their domestic economies ramp up they must export their savings, in this case in part through currency rate manipulations, or the result is their own currency blowing up and stagnating their development. Like all such games this one eventually blows up. Lack of control of risk in the global financial system is a big part of what went wrong, but without all the Asian money sloshing around it would not have been possible to have such a huge bonfire in the first place. There is nothing particularly responsible about using currency rate manipulations to export a savings glut.

Well said

CheatCommando: Except the appeal to authority is only a fallacy when you try to quote someone of recognized expertise's opinion on an area outside of their expertise. Example: quoting Albert Einstein on theology or Stephen Hawking on music.

Quoting either of them to back up an argument about physics is an entirely different ball of wax. See the difference?

Couldn't be more wrong. (new window)

bronyaur1: WhileAmericaBurns: bronyaur1: WhileAmericaBurns: bronyaur1: Obviously subby knows far more about economics than Ben Bernanke and Paul Krugman.

Welcome to America, where morons pompously believe that their opinions are as worthwhile as those of highly educated and intelligent people the people don't let themselves be pushed around just because someone has a fancy title.

Yeah... listening to people with more intelligence or education is clearly being pushed around.

Tell us, does it hurt when your knuckles drag on the ground like that? What WAS it like to be an extra in Idiocracy?

If Ben Bernanke were in the private sector, your argument would be valid. As a person in government power, though, his primary role is not to impart his wisdom to you and I, but to do as he pleases with our economy. This whole business of treating the Fed Chairman like a wise oracle is bullshiat, the purpose of which is to intimidate the people into accepting his power unquestioningly. It's like he's our Ayatollah, but instead of controlling who gets to be President, he controls the entire monetary system. It's hard to say which role is scarier.

So, let me get this right.... you think that someone who got his Phd in economics from MIT, his undergrad in econ summa cum laude in economics from Harvard, who nearly got a perfect score on the SAT, who did his dissertation on uncertainty and business cycles, who is one of the world's foremost experts on economic policy choices during the Great Depression, who has chaired the Princeton Econ dept, and who spent a number of years associated with the Fed is NOT someone whose advice we should consider above nearly all others on the matters at hand?

Suggest someone more qualified and brighter and whose ideas on the real-time practice of monetary and economic policy should be treated with more respect than Ben Bernanke's.

You remember that episode of The Simpsons with Stephen Hawking? Watch that again and maybe you'll get what I'm saying.

Ben gave TAX CHEAT Geitner a hug when the Chinese laughed right in his TAX CHEAT face.

@bronyaur1:

Funny thing about famous people. They start believing their own hype. This is a very bad thing, even in scientific fields whose foundations are fairly rigid. Take a field like macroeconomics, where the foundations are constantly shifting, add in someone who's started to believe his own hype, and you get a recipe for a disaster of epic proportions.

Put another way, there is no room for hero worship in any scholarly endeavor. Especially a scholarly endeavor that affects the lives of million people. Put a way the Internet crowd can understand, science should be all "corroborating data or GTFO" and then the scientist should be all "no wai" and the community should be all "ya wai".

From your link:
On the other hand, arguments from authority are an important part of informal logic. Since we cannot have expert knowledge of many subjects, we often rely on the judgments of those who do. There is no fallacy involved in simply arguing that the assertion made by an authority is true...

Two of the worst economists ever--thanks Princeton.

Funny money begets massive imbalances. It shouldn't take an Ivy League degree to know that.