Which is basically Obama's unofficial 2012 slogan.

Hey, don't get too optimistic. I still need to sell a few copies of "The Return of Depression Economics" before you cheer up.

I came to find out from those on the right why this is bad news. I am sure I won't be disappointed.

"I see a trend line that is now going up. Hooray!"

All Krugman can do is look at data formed into lines and extrapolate. And we all know some of the problems with extrapolation thanks to xkcd. Plus, he can never spot the turn of a trend; when things change he always has to backpedal.

Darth_Lukecash: I guess no one gives a fark about this guys opinion.

And maybee, we shouldn't have an economy based on just one thing.

I like reading this guys opinion at least it isn't the normal, well the only thing we can do to make this economy better is throw more money at the rich, derp I see all the time.

The second part I couldn't agree with more. We actually have two "industries" construction (the production of actual wealth especially when you have a fiat currency) and finance.

Looking at what we produce in America, I know we are in real trouble. The first one is based on inflating home prices and games with our currency and the other is also based on games with our currency.

At some time the music stops and the game ends.

How is it possible the economy is improving if the republican congress has stopped the much-needed next wave of stimulus to increase demand?

Krugman in September - "It just wasn't big enough to do the job.

."

Then what has changed?

I imagine Republicans are thankful for short memories and fail to recall when things were constantly exploding in George Bush's hands, abetted by his "freedom" fries GOP congress. You've been through denial, anger, and are you going to just skip right over bargaining, hit depression and acceptance of the fact that the GOP has run out of road?

aaronx: Will he ever get any credit for being right almost all of the time (and admitting it when he gets something wrong)? How far down the austerity road do we all have to go before anybody currently influential (policy-wise) admits that austerity is the exact opposite of what is needed? Oh, wait; then they'd have to admit that Krugman was right the whole time.

Krugman has invalidated his whole theory by saying things are starting to improve. What has changed in the past year and a half to have an effect on the economy?

For the past 2, 3 years, he's been saying we need a bigger stimulus package not centered on tax cuts. Did that pass in the past year and a half and I missed it?

MugzyBrown: How is it possible the economy is improving if the republican congress has stopped the much-needed next wave of stimulus to increase demand?

Krugman in September - "It just wasn't big enough to do the job.

."

Then what has changed?

This is an election year and a sitting pres has never been elected with unemployement this high. Just something to bouye people's confidence and to get them to overlook our bad in hopes the good is just around the courner.

MugzyBrown: aaronx: Will he ever get any credit for being right almost all of the time (and admitting it when he gets something wrong)? How far down the austerity road do we all have to go before anybody currently influential (policy-wise) admits that austerity is the exact opposite of what is needed? Oh, wait; then they'd have to admit that Krugman was right the whole time.

Krugman has invalidated his whole theory by saying things are starting to improve. What has changed in the past year and a half to have an effect on the economy?

For the past 2, 3 years, he's been saying we need a bigger stimulus package not centered on tax cuts. Did that pass in the past year and a half and I missed it?

Didn't catch any bait with your Boobies so you went and did another with the same principle huh?

The stimulus worked (new window). If it were bigger, it would have worked better.

FTFA:

But things could have been worse; they would have been worse if we had followed the policies demanded by Mr. Obama's opponents. For as I said at the beginning, Republicans have been demanding that the Fed stop trying to bring down interest rates and that federal spending be slashed immediately - which amounts to demanding that we emulate Europe's failure.

And if this year's election brings the wrong ideology to power, America's nascent recovery might well be snuffed out.


Translation:
The economy still sucks, but it's an election year so let's hypothesize that a Republican president would do worse than Obama.

MugzyBrown: How is it possible the economy is improving if the republican congress has stopped the much-needed next wave of stimulus to increase demand?

Krugman in September - "It just wasn't big enough to do the job.

."

Then what has changed?

Congress decided to raise the debt ceiling?

Zombie Butler: Looking at what we produce in America, I know we are in real trouble. The first one is based on inflating home prices and games with our currency and the other is also based on games with our currency.

Still #1 and by a wide margin. Not likely to change anytime real soon.

Didn't catch any bait with your Boobies so you went and did another with the same principle huh?

The stimulus worked (new window). If it were bigger, it would have worked better.

Then why was Krugman stating it wasn't working because it was too small up until now?

Why were defenders of the stimulus saying we needed a second round as the unemployment started ticking up as the money ran out? June '10 - Nov' 10 from 9.4 - 9.8. The Krugmans were saying: See what the GOP is doing?! We need more!

But now things are improving? What's changed?

PowerSlacker: FTFA:

But things could have been worse; they would have been worse if we had followed the policies demanded by Mr. Obama's opponents. For as I said at the beginning, Republicans have been demanding that the Fed stop trying to bring down interest rates and that federal spending be slashed immediately - which amounts to demanding that we emulate Europe's failure.

And if this year's election brings the wrong ideology to power, America's nascent recovery might well be snuffed out.


Translation:
The economy still sucks, but it's an election year so let's hypothesize that a Republican president would do worse than Obama.


Nothing hypothetical about it, the bold text is true.

DarnoKonrad: Nothing hypothetical about it, the bold text is true.

You can't complain about lack of savings when the interest rate in savings accounts is 0.2% and inflation closer to 4%.

I love watching my savings devalue every month.

aaronx: The trend might be towards slow but sustainable improvement. Um, yay?

That might be jumping the gun a little bit. In order to get anything to qualify as sustainable improvement, we better get our debt problem under control. Having some slow and steady growth will help, but if we continue to post trillion dollar deficits every year, it will not stay 'improved' for long.

There is some light, but we are still a long way from crawling out of this hole.

He was great in The Odd Couple, and absolutely brilliant in Quincy M.D., but that doesn't mean we should trust his opinion on the economy. Jus sayin...

Arkanaut: MugzyBrown: How is it possible the economy is improving if the republican congress has stopped the much-needed next wave of stimulus to increase demand?

Krugman in September - "It just wasn't big enough to do the job.

."

Then what has changed?

Congress decided to raise the debt ceiling?

On second thought that wasn't the best answer, since that was passed in early August -- but IMO the economy kinda held its breath between May when the government shutdown fight was happening, and the debt ceiling fight and the S&P downgrade. But since then, even with the euro troubles and the Supercommittee bullshiat, there's been an audible sigh from at least American businesses.

DarnoKonrad: Nothing hypothetical about it, the bold text is true.

But reduced federal spending and a return to normailzed interest rates has to be done at some point. The big question is when. The longer we wait, the bigger our debt problem.

Nobel prize winner?

Big deal. They gave Obama the Peace Prize and he continued to wage war so the committees' judgement is sorely lacking.

Look: Krugman is a hack. And here are just two reasons:

1) He was an Enron 'advisor'
2) In the past 18 months he wrote a column stating that UE benefits do not keep people from looking for work.

The only problem with this is that in his textbook from about 5 years ago he blantantly stated that UE benefits DID keep people from looking for work.

And one more:
He turned off the comments section of his blog because other economists were writting in pointing out his errors.

What a thin-skinned, lying horse's azz.

HeadLever: aaronx: The trend might be towards slow but sustainable improvement. Um, yay?

That might be jumping the gun a little bit. In order to get anything to qualify as sustainable improvement, we better get our debt problem under control. Having some slow and steady growth will help, but if we continue to post trillion dollar deficits every year, it will not stay 'improved' for long.

There is some light, but we are still a long way from crawling out of this hole.

I'm not as concerned about the debt as I am the nature of our economy. We've lost jobs that are not coming back, and has been pointed out, our economy seems to be overly focused on finance and home building. As I've gotten older and watched the stock market, successful and unsuccessful companies and the general trajectory of where our best and brightest go for jobs, we need to start serious inroads into technological innovation and in general, push science and engineering as much as possible in as many areas as we can. The best we seem to be able to do now is support old, outdated business models and the associated companies and industries that refuse to modernize. Farming, energy (oil and gas), telecommunications and entertainment are all areas seem to rely directly on government handouts or government enforcement to support their business models rather than modernize and innovate.

We're still doing pretty good, but our increasingly uneducated populace and welfare business culture are going to be our undoing eventually.

douchebag/hater: Krugman is a hack.

I see.

Well, then I guess that we should give more tax cuts to rich people.

HeadLever: DarnoKonrad: Nothing hypothetical about it, the bold text is true.

But reduced federal spending and a return to normailzed interest rates has to be done at some point. The big question is when.

When the economy recovers and unemployment returns to normal rates (around 5-6%), and we have job creation at at least a 200k per month rate.

The longer we wait, the bigger our debt problem.

The flip side is, the stronger the economy is, the smaller the debt problem, since a lot of bondholders are fixated on the debt vs GDP number. In other words, if GDP growth outstrips debt growth then we will have overall debt reduction. IMO the least harmful path would be to focus on job creation first and foremost, and move to gradual debt reduction when the economy is on solid footing.

aaronx: Will he ever get any credit for being right almost all of the time (and admitting it when he gets something wrong)?

I have never had less concern or worry for the possibility of a thing happening.

Arguing that "the stimulus worked" is a simple sleight of hand trick used by all manner of empty fortune tellers.

1. Issue statement: "We need stimulus!"
2. Some stimulus is implemented.
3. If the economy continues to fail, claim: "Wasn't enough stimulus!"
4. If the economy turns around, claim: "Yay! Thank stimulus!"

Bonus: Krugman has managed to work both of these seemingly contradictory claims within the span of recent memory.

I could replace the word "stimulus" with Jesus and it would be a statement with equal predictive ability and economic utility.

MugzyBrown: How is it possible the economy is improving if the republican congress has stopped the much-needed next wave of stimulus to increase demand?

Krugman in September - "It just wasn't big enough to do the job.

."

Then what has changed?

This is the standard Keynesian Stimulus doubletalk method...

Scenario 1:

"Modest" sized stimulus (it almost inevitably is)

Reaction 1: That is never going to be enough! Bigger! BIGGER!

Outcome 1: Economy fails to improve.

Reaction 1 to Outcome 1: Well, I TOLD YOU it wouldn't be big enough...*passive aggressive sarcastic biatch tone*

Scenario 2:

Also, "modest" sized stimulus

Reaction 2: That is never going to be enough! Bigger! BIGGER!

Outcome 2: The economy actually improves markedly.

Reaction 2 to Outcome 2: Well, you should just be thankful we had a stimulus that was as large as it was...still, the recovery would have been SOOOO much faster with a bigger one.

Observational sciences with crappy statistics to work with like economics make the criteria for falsifiability a little, shall we say, lacking.

Also, since he is an ivory tower fink, he can be a little politically naive about how stimulus money is typically "administered" in reality...patronage. Politicians are given a massive pile of money, and you actually expect they wont just channel a lot of that to their friends through various subterfuge methods? Seriously??

All, I know is tax cuts function like vacuum for the richies, since the market place is not competitive enough to force them to reduce their prices too much on goods for the rest of us...and high finance is nearly insulated all together. Stimulus can have some beneficial effects, but the way the politicos end up channeling it usually results in short lived non sustainable practices. All the richies have to do to take advantage of stimulus is to put out their nets and bring in their catch falling from above. Both approaches have their foibles...

Sun Worshiping Dog Launcher: I'm not as concerned about the debt as I am the nature of our economy.

Yes and no. I would definatly say that the ecnonomy is much more of a immediate concern. The problems with the debt are much longer term problems, however, we are getting close to reaching a tipping point here as well. The longer we hold off on doing anthing meaninful to reduce debts, the harder it will be to reign in the problem. These debt problems, if left unchecked, will have a direct impact on the health of the ecnomomy.

Link (new window)

douchebag/hater: 1) He was an Enron 'advisor'

He worked there for four days in 1999, before anyone knew they were corrupt. This is textbook guilt by association.

douchebag/hater: 2) In the past 18 months he wrote a column stating that UE benefits do not keep people from looking for work.

The only problem with this is that in his textbook from about 5 years ago he blantantly stated that UE benefits DID keep people from looking for work.

Link? I doubt this is as simple as you're making it sound.

douchebag/hater: He turned off the comments section of his blog because other economists were writting in pointing out his errors.

...His blog has a comments section, and it clearly works - there's 327 comments just on this article.

Arkanaut: When the economy recovers and unemployment returns to normal rates (around 5-6%), and we have job creation at at least a 200k per month rate.

I would generally agree, however, waiting for the economy to reach this level may not be the best thing to do. I would place an additional time constraint on this as well.

The flip side is, the stronger the economy is, the smaller the debt problem, since a lot of bondholders are fixated on the debt vs GDP number. In other words, if GDP growth outstrips debt growth then we will have overall debt reduction. IMO the least harmful path would be to focus on job creation first and foremost, and move to gradual debt reduction when the economy is on solid footing.

True in principal, but you need to consider interest on the national debt in this discussion. This interest oblibation directly impacts the ability to control the debt. Last year, this interest obligation on the extended debt ate up about 450 Billion (this is was about 2.9% of GDP). When this interest obligation itself is larger than the typical growth rate of GDP, you start to lose the abillty to control this debt, especially when it is nearly impossible to pass a balanced budget. You basically start a debt spiral as shown in the graph above.

Krugman is a turd. I refuse to read anything written by him. The first ten of his columns where all he said was OMFG@)#$$##KEYNESIAN_ECONOMIX)!)!)!))one! was enough for me.

Broken record on a badly written song.

Let me take a wild guess...some republican(s) and/or republican policy is to blame for the thing Krugman is upset about? (possibly, Bush and/or the Bush admin is still somehow at fault)..if we'd just listen to him/some democrat/obama it would have been fixed by now...?

/DNRTA

Death_Poot: Krugman is a turd


Krugman was the most accurate media person in this study

http://www.hamilton.edu/documents/Analysis-of-Forcast-Accuracy-in-the - Political-Media.pdf

Bob16: Krugman was the most accurate media person in this study

He's a Nobel prize winning economist, it's not actually a surprise that he's very good at his job. Of course, his accuracy pisses of people who would prefer it if Keynesian economics didn't work, so it's not really a surprise to see so much hatred directed at him

Denial
Anger
Bargaining
Depression
Acceptance

Of course it could have been worse. Has anyone seen John McCain lately? How bad would hsi faculties be if he had the stress of being President. Anyway, the economy may be starting to improve slightly. But it is very fragile and susceptible to external shocks that could reverse course and cause a crash. Such as the much desired neo-con war with Iran.

Elzar: If we accept Krugman's opinion that it could have been worse, then we can no longer claim Obama is intent on destroying the US which is one fact that is irrefutable. I mean seriously has he looked out the window lately - the US is utterly destroyed and Max Max style anarchy abounds...

Obama has been taking our jobs, turning us into a Sharia law state and will soon mandate blenderized Arugula enemas to be administered to all citizens fortnightly. Just look at what he has done to the stock markets in this country - utter devastation and he has taken away everyone's guns, interned god-fearing republicans in concentration camps and forced women to have mandatory abortions.

/ god bless the tea party and the usa
// RON PAUL

0/10. The birds perching outside my window right now could do better than that.

Gunther: Bob16: Krugman was the most accurate media person in this study

He's a Nobel prize winning economist, it's not actually a surprise that he's very good at his job. Of course, his accuracy pisses of people who would prefer it if Keynesian economics didn't work, so it's not really a surprise to see so much hatred directed at him

Exactly

HeadLever: Arkanaut: When the economy recovers and unemployment returns to normal rates (around 5-6%), and we have job creation at at least a 200k per month rate.

I would generally agree, however, waiting for the economy to reach this level may not be the best thing to do. I would place an additional time constraint on this as well.

Time doesn't mean that much on its own -- you need to react to the actual state of the economy. Perhaps if you were to say that we should cut back when the 10-year treasury rates rose over (let's say) 5%, or if more than 50% of the federal budget was being spent to pay off bond interest, I might agree.


The flip side is, the stronger the economy is, the smaller the debt problem, since a lot of bondholders are fixated on the debt vs GDP number. In other words, if GDP growth outstrips debt growth then we will have overall debt reduction. IMO the least harmful path would be to focus on job creation first and foremost, and move to gradual debt reduction when the economy is on solid footing.

True in principal, but you need to consider interest on the national debt in this discussion. This interest oblibation directly impacts the ability to control the debt. Last year, this interest obligation on the extended debt ate up about 450 Billion (this is was about 2.9% of GDP). When this interest obligation itself is larger than the typical growth rate of GDP, you start to lose the abillty to control this debt, especially when it is nearly impossible to pass a balanced budget. You basically start a debt spiral as shown in the graph above.

2.9% of GDP is certainly a lot of money, but even with all the uncertainty in Europe and governments at both state and federal levels cutting staff and freezing pay, the economy is expanding at 1.8 to 2%. Is it that difficult to imagine it just a point or so higher, if we were to give the poor and middle classes some better support?

Bob16: Gunther: Bob16: Krugman was the most accurate media person in this study

He's a Nobel prize winning economist, it's not actually a surprise that he's very good at his job. Of course, his accuracy pisses of people who would prefer it if Keynesian economics didn't work, so it's not really a surprise to see so much hatred directed at him

Exactly

Reality has a liberal bias, as is well known.

MugzyBrown: You can't complain about lack of savings when the interest rate in savings accounts is 0.2% and inflation closer to 4%.

I love watching my savings devalue every month.

When has your savings account ever paid anything remotely close to the rate of inflation? When in the past 1000 years would the spread have been better?

Why are there no right wingers that seem to understand basic economic principles? It's one thing to have differing opinions on grad school theories, but these guys seem to all have failed Econ 101.

Arkanaut: Time doesn't mean that much on its own -- you need to react to the actual state of the economy. Perhaps if you were to say that we should cut back when the 10-year treasury rates rose over (let's say) 5%, or if more than 50% of the federal budget was being spent to pay off bond interest, I might agree.

That is what I pretty much meant. If left unchecked, there will come a time when interest will start to outstrip our ability to keep up. We don't want to reach that point, no matter what happens. We need to set a time constraint to ensure that does not happen, regardless of what the economy does. (I see my graph did not make it above, so here it is)



2.9% of GDP is certainly a lot of money, but even with all the uncertainty in Europe and governments at both state and federal levels cutting staff and freezing pay, the economy is expanding at 1.8 to 2%. Is it that difficult to imagine it just a point or so higher, if we were to give the poor and middle classes some better support?

Giving support to the poor is not really the point. Nearly all agree that this is a worthy goal. The point will be that we may soon not be able to afford it. That is where the problems come in.

El Pachuco: When has your savings account ever paid anything remotely close to the rate of inflation? When in the past 1000 years would the spread have been better?

The problem is that this is now finding its way into CDs, and bonds. It is not just a problem with savings accounts anymore.

So far, inflation has not been too bad (at least overall), however, things could get very interesting very fast if the economy starts to boom. The conditions are right, it just needs a little jumpstart.

Actually, to get him even to admit some good, is a positive sign.

He's a pessimistic realist and then some.

Now the key is, when it's about to hit the fan this next time...you might want to listen to him.
Not to overreact...but just consider his words.

I think we got lucky this time...it shook itself out, but it took a lot of pain, that a lot of people are still dealing with.