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(CNBC)   Paul Krugman doesn't want Latvia to succeed if it proves him wrong   (cnbc.com) divider line 96
    More: Obvious, fiscal adjustment, EU summit, Paul Krugman  
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3532 clicks; posted to Business » on 15 Mar 2013 at 6:21 PM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-03-15 05:40:58 PM
I'm no economist, but doesn't having your GDP drop 20% before rebounding with 5% growth sound like a much worse outcome than slow consistent GDP growth of ~2% until your economy recovers?
 
2013-03-15 05:45:10 PM
www.latelatebreakfastshow.com

Don't be ridiculous!
 
2013-03-15 05:58:05 PM
Doom would not allow this outrage!
 
2013-03-15 06:00:21 PM
"We're looking at a Depression-level slump, and 5 years later only a partial bounceback; unemployment is down but still very high, and the decline has a lot to do with emigration. It's not what you'd call a triumphant success story," he continued.

Leaving the country to find a job is a sign that austerity measures work. Got it.
 
2013-03-15 06:04:55 PM
Subby must be another of those magic republicans than can tell what a liberal or Democrat is thinking.
 
2013-03-15 06:05:11 PM
a 24% GDP drop is farkING CATASTROPHIC, it is factors higher than the US recession.

There'll always be a bounceback after a drop like that and at only 5% it's not yet anywhere close to the size it was pre recession yet.

But I'm glad the econofarkwits are looking at data now. It's a good start. Maybe you could explain the impact of austerity on Greece, Portugal, the UK and Spain.
 
vpb [TotalFark]
2013-03-15 06:24:52 PM
So this is the best that anyone can come up with?  Has anyone actually looked at Latvia's economy?  The IMF and EU bailout, and the internal devaluation?  Someone want's to emulate that?

If it wasn't for the fact that Ireland was the previous attempt to find an example of GOP style economic policy that worked I would be amazed.
 
2013-03-15 06:26:55 PM

nmrsnr: I'm no economist, but doesn't having your GDP drop 20% before rebounding with 5% growth sound like a much worse outcome than slow consistent GDP growth of ~2% until your economy recovers?


Would you as a lobster like to be cooked alive in serious pain or do you prefer being dropped in already boiling water that will end it all quick?
 
2013-03-15 06:30:44 PM
So how does this relate to the Coconut Island economy?
 
2013-03-15 06:31:48 PM
www.samruby.com
KRUGMAAAAAN!!!
 
2013-03-15 06:32:43 PM
Hurray, an autoplay video.  CNBC you are off my whitelist.
 
vpb [TotalFark]
2013-03-15 06:51:40 PM

nmrsnr: I'm no economist, but doesn't having your GDP drop 20% before rebounding with 5% growth sound like a much worse outcome than slow consistent GDP growth of ~2% until your economy recovers?


You aren't looking at it properly.  You just look at the growth and ignore the catastrophic depression.
 
2013-03-15 06:57:52 PM
5% economic growth coming off from a depression isn't exemplary, it's normal.  There's no evidence that austerity fixed everything.  And last I checked, Estonia's GDP was still at 90% pre-crash levels.
 
2013-03-15 07:02:53 PM

GAT_00: And last I checked, Estonia's GDP was still at 90% pre-crash levels.


Let's stick to bashing Latvia.  Estonia has some incredibly hot women and shouldn't have to suffer a Krugman thread.
 
jbc [TotalFark]
2013-03-15 07:03:54 PM
How is that any different than the current crop of Republicans not wanting this country to succeed?
 
2013-03-15 07:10:49 PM
Any policy that requires your young educated citizens to flee in droves is not a success story.
 
2013-03-15 07:10:57 PM
Basic rule:  Look for austerity measures to take during a boom, not during a recession.  Duh.
 
2013-03-15 07:14:24 PM
"We're looking at a Depression-level slump, and 5 years later only a partial bounceback; unemployment is down but still very high, and the decline has a lot to do with emigration. It's not what you'd call a triumphant success story,"

Sounds a lot like the US "recovery".
 
2013-03-15 07:19:43 PM

Soup4Bonnie: GAT_00: And last I checked, Estonia's GDP was still at 90% pre-crash levels.

Let's stick to bashing Latvia.  Estonia has some incredibly hot women and shouldn't have to suffer a Krugman thread.


F*ck.  I read the article, and since they suddenly switched to Estonia from Latvia, that stuck in my head as the topic.
 
2013-03-15 07:43:46 PM
/watches video

That doesn't look like Doctor Doom...
 
2013-03-15 07:53:01 PM
Yeh guys.  Let's idolize... Latvia.
 
2013-03-15 07:55:13 PM

Soup4Bonnie: Let's stick to bashing Latvia.  Estonia has some incredibly hot women and shouldn't have to suffer a Krugman thread.


Latvia also has some amazing women!  All three of the Baltic States are really great places to visit.
 
2013-03-15 07:57:21 PM

Soup4Bonnie: GAT_00: And last I checked, Estonia's GDP was still at 90% pre-crash levels.

Let's stick to bashing Latvia.  Estonia has some incredibly hot women and shouldn't have to suffer a Krugman thread.


I'd like to bash some Latvia
/if you know what I mean
//and I know you know what I mean

2.bp.blogspot.com
 
2013-03-15 07:59:48 PM

The WindowLicker: Latvia also has some amazing women! All three of the Baltic States are really great places to visit.


And it only costs you $2.
 
2013-03-15 08:00:20 PM

The WindowLicker: Soup4Bonnie: Let's stick to bashing Latvia.  Estonia has some incredibly hot women and shouldn't have to suffer a Krugman thread.

Latvia also has some amazing women!  All three of the Baltic States are really great places to visit.


I'm either highly encouraged or highly discouraged if I knew what this chart meant

mengster.files.wordpress.com
 
2013-03-15 08:02:34 PM
They seem fond of pink and little dogs.

www.hookingupsmart.com
 
2013-03-15 08:05:24 PM

GoodyearPimp: Yeh guys.  Let's idolize... Latvia.


While I can't comment on the other aspects of the story, one interesting aspect is that the Latvian currency (LVL) has been pegged to the Euro for over 7 years now.  They did not inflate it during the 2008 crash.  This provides an interesting contrast for other european union contries that very likely would have inflated their currencies if they had the option.  (I am looking at Greece here).

/these are strictly my personal opinions.
 
2013-03-15 08:11:23 PM

relaxitsjustme: The WindowLicker: Soup4Bonnie: Let's stick to bashing Latvia.  Estonia has some incredibly hot women and shouldn't have to suffer a Krugman thread.

Latvia also has some amazing women!  All three of the Baltic States are really great places to visit.

I'm either highly encouraged or highly discouraged if I knew what this chart meant

[mengster.files.wordpress.com image 398x348]


I think the y axis has to do with sexual openness and the x axis has to do with the number of men to women.
 
2013-03-15 08:11:31 PM
Knock, knock.
Who's there?
Latvian.
Latvian who?
Please open, is cold.
 
2013-03-15 08:12:14 PM

Tigger: a 24% GDP drop is farkING CATASTROPHIC, it is factors higher than the US recession.

There'll always be a bounceback after a drop like that and at only 5% it's not yet anywhere close to the size it was pre recession yet.

But I'm glad the econofarkwits are looking at data now. It's a good start. Maybe you could explain the impact of austerity on Greece, Portugal, the UK and Spain.


Europeans are finally realizing that austerity has gone too far. the outcome of the Italian elections gave the pro-austerity europeans a big kick in the ass.
 
2013-03-15 08:19:09 PM

relaxitsjustme: They seem fond of pink and little dogs.


I am guessing that is the Blond parade.  It is sort of a uniform.  Most of the dogs I have seen around are the german shephard or siberian husky type, but I suppose the little ones appeal to a certain subset.

It is a place where being an American is a definite plus.  Latvia as a whole did not enjoy the 50ish years of soviet occupation.  There is a large percentage of the population that likes us purely because we were opposed to the Soviet Union.  This is demonstrated in some interesting ways.   For example, Latvia has an extremely high operational tempo of deployments in support of OEF.

/personal views only.
 
2013-03-15 08:23:12 PM

GAT_00: I think the y axis has to do with sexual openness and the x axis has to do with the number of men to women.


Well Taiwan has gender imbalance with more males than females, and Japan among others seems to be the example of a country that has less in the way of openness, so I think Relaxitsjustme can be very optimistic.
 
2013-03-15 08:23:28 PM

cman: nmrsnr: I'm no economist, but doesn't having your GDP drop 20% before rebounding with 5% growth sound like a much worse outcome than slow consistent GDP growth of ~2% until your economy recovers?

Would you as a lobster like to be cooked alive in serious pain or do you prefer being dropped in already boiling water that will end it all quick?


Your analogy would be apt if our economy were shrinking at 2% per year, but it's not -- it's growing.  We saved the lobster and allowing it to slowly heal, while Latvia's lobster is crippled for life but is learning to get around surprisingly quickly on its claws.
 
2013-03-15 08:32:58 PM
Of course he doesn't because he's one of the biggest hack economists living.

Oh he has a Nobel Prize you say?

BFD so does Obama.
 
2013-03-15 08:39:25 PM

douchebag/hater: Of course he doesn't because he's one of the biggest hack economists living.

Oh he has a Nobel Prize you say?

BFD so does Obama.


Winners of the Nobel Peace prize and the Nobel science prizes are chosen by two different committees in two different countries. Science prizes are based on actual proven accomplishments. Peace prizes are awarded based on what feels good to the committee.

But perhaps you could get someone intelligent who could explain Krugman's writings to you so you wouldn't have to parrot GOP derp points.

You must hate yourself.
 
2013-03-15 08:55:09 PM

douchebag/hater: Of course he doesn't because he's one of the biggest hack economists living.

Oh he has a Nobel Prize you say?

BFD so does Obama.


You know who else had a Nobel Prize?

image.guim.co.uk

/That's right!
 
2013-03-15 09:01:36 PM

The WindowLicker: GoodyearPimp: Yeh guys.  Let's idolize... Latvia.

While I can't comment on the other aspects of the story, one interesting aspect is that the Latvian currency (LVL) has been pegged to the Euro for over 7 years now.  They did not inflate it during the 2008 crash.  This provides an interesting contrast for other european union contries that very likely would have inflated their currencies if they had the option.  (I am looking at Greece here).

/these are strictly my personal opinions.


blogs-images.forbes.com
On the other hand a large portion of the country left. The ones that left were almost exclusively those adults under the age of 30.

A lost generation.

But at least the bankers got all their money.
 
2013-03-15 09:12:10 PM

HempHead: The WindowLicker: GoodyearPimp: Yeh guys.  Let's idolize... Latvia.

While I can't comment on the other aspects of the story, one interesting aspect is that the Latvian currency (LVL) has been pegged to the Euro for over 7 years now.  They did not inflate it during the 2008 crash.  This provides an interesting contrast for other european union contries that very likely would have inflated their currencies if they had the option.  (I am looking at Greece here).

/these are strictly my personal opinions.

[blogs-images.forbes.com image 709x437]
On the other hand a large portion of the country left. The ones that left were almost exclusively those adults under the age of 30.

A lost generation.

But at least the bankers got all their money.


How can a country lose 7% of its population in one year? That's insane. That's as if 25 million Americans left in a single year.
 
2013-03-15 09:16:11 PM
Without getting too political, it does seem the Nordic version of austerity has worked.

http://www.economist.com/news/special-report/21570840-nordic-countri es -are-reinventing-their-model-capitalism-says-adrian
 
2013-03-15 09:21:35 PM

DamnYankees: How can a country lose 7% of its population in one year? That's insane. That's as if 25 million Americans left in a single year.


The rest were trapped.
 
2013-03-15 09:27:14 PM

HempHead: On the other hand a large portion of the country left. The ones that left were almost exclusively those adults under the age of 30.

A lost generation.

But at least the bankers got all their money.


There are some other major factors at work in Latvia that I will not comment on, but your graph hints at them a bit.

Not to imply that youth have not been disproportionately affected by the recession, but the economic situation is only one of many things in play.  Also, you see the same effect in the us, even during times of economic stability.  I grew up in Maine, like most of my generation, I then left the state.  Latvia is very similar to Maine or really any of the other states in the US that are dealing with brain drain.
 
2013-03-15 09:29:12 PM

Krugman is perfectly willing to admit when he's wrong.

Readers sometimes complain about my frequent references to the things my friends and I got right, and others got wrong. But look, it's not ego (or anyway it's not just ego). Predictions are how you judge between models. If the world delivers results that are very much at odds with what your framework says should have happened, you're supposed to reconsider your framework - as I did, for example, after I was wrong about interest rates in 2003.
Problem for conservatives is that he's rarely mistaken.
 
2013-03-15 09:33:32 PM
Why do we take Austrian economists seriously anyways? They're practically the same as Scientologists in that they have nothing to back up their beliefs but they know for sure that what they believe in is right.

Let the flame war begin!
 
2013-03-15 09:37:25 PM

jpo2269: Without getting too political, it does seem the Nordic version of austerity has worked.

http://www.economist.com/news/special-report/21570840-nordic-countri es -are-reinventing-their-model-capitalism-says-adrian


The impression I got when I read that article was that Scandinavian welfare states were bloated beyond all belief and as a result was gradually cut and privatized to make it more lean than it was before.

Unlike here in the US, the Scandinavians actually trust their government to provide basic services instead of treating it like some evil monolith like we do here in the States.

But it is still stronger than the US welfare state even in its lean form.

Feel free to correct me if I read this wrong.
 
2013-03-15 09:37:51 PM
"austerity" means living within your means. Why is that so wrong? They spent money they didn't have and then had to repay it by doing without.

Once the debt is under control they can spend again and the economy will grow.

imagine if instead of spending money on BS stimulus the government had simply borrowed HALF the moneyit borrowed, thinned out government waste and cut all taxes by 50%. as long as the tax savings was invested in america. they could have then phsed the taxes back in after two yearsd  and we would be on top of the world right now.

Krugmans theory only works if the government has cash to spend on infradtucure not if they have no source of revenue.

He is an idiot.
 
2013-03-15 09:50:18 PM

billmarshall: "austerity" means living within your means.


Austerity means no outlays, period.  If you were a family, that means no phone, no cable, no internet (sound reasonable so far?), no gas, no electric, no water (not reasonable to you?), no rent, no mortgage, no car, no house (good luck finding a place to live and a way to work), no insurance of any sort, as little on food and clothing as possible.

That's not "living within your means", that's insanity.  And if you're still not taking in enough money to be floating after all of that, you're still not "living within your means" anyway.
 
2013-03-15 09:56:52 PM

IlGreven: billmarshall: "austerity" means living within your means.

Austerity means no outlays, period.  If you were a family, that means no phone, no cable, no internet (sound reasonable so far?), no gas, no electric, no water (not reasonable to you?), no rent, no mortgage, no car, no house (good luck finding a place to live and a way to work), no insurance of any sort, as little on food and clothing as possible.

That's not "living within your means", that's insanity.  And if you're still not taking in enough money to be floating after all of that, you're still not "living within your means" anyway.


This is perhaps the most intelligent argument against Austerity I've seen on Fark.

There's "living within your means" and "depriving yourself of everything except the absolute essentials that you need to survive". Austerity worshipers take it to a ridiculous extreme.

And the real scary thing is the people praising Austerity here in the US aren't even considering revenue increases to help pay off the debt faster.

All that cost cutting is practically worthless if you don't increase your revenue.

Do you not get a second job (increase revenue) if you are deep in debt?
 
2013-03-15 10:06:52 PM

billmarshall: "austerity" means living within your means. Why is that so wrong?


It's not, but there's something you need to understand about economies: They depend on money to move through various sectors to be healthy. If money is not moving, then that's bad. The economy crashes when the money slows down or stops moving.

Now, there are all sorts of reasons why the money would stop moving that I won't get into here. But the point is the only way to get the money to start moving again is to pour a whole bunch of it into the economy. And the only way to do that is to borrow and spend.

(there are qualifiers and variable to all this, yadda yadda...mileage varies, etc.. I'm just being really simplified here)

Austerity is the belief that, if the money slows down and the economy goes into the crapper, the only way to pull out of it is to reduce or shrink the various sectors -- in effect, take more money out of the economy. That's bad, because it means there is even less money moving around than before, which makes the economy even worse.
 
2013-03-15 10:06:57 PM

DamnYankees: HempHead: The WindowLicker: GoodyearPimp: Yeh guys.  Let's idolize... Latvia.

While I can't comment on the other aspects of the story, one interesting aspect is that the Latvian currency (LVL) has been pegged to the Euro for over 7 years now.  They did not inflate it during the 2008 crash.  This provides an interesting contrast for other european union contries that very likely would have inflated their currencies if they had the option.  (I am looking at Greece here).

/these are strictly my personal opinions.

[blogs-images.forbes.com image 709x437]
On the other hand a large portion of the country left. The ones that left were almost exclusively those adults under the age of 30.

A lost generation.

But at least the bankers got all their money.

How can a country lose 7% of its population in one year? That's insane. That's as if 25 million Americans left in a single year.




What is amazing is that anyone thinks it is a legitimate economic plan that could work any where else(especially in the US).
 
2013-03-15 10:10:02 PM

billmarshall: "austerity" means living within your means. Why is that so wrong? They spent money they didn't have and then had to repay it by doing without.

Once the debt is under control they can spend again and the economy will grow.

imagine if instead of spending money on BS stimulus the government had simply borrowed HALF the moneyit borrowed, thinned out government waste and cut all taxes by 50%. as long as the tax savings was invested in america. they could have then phsed the taxes back in after two yearsd  and we would be on top of the world right now.

Krugmans theory only works if the government has cash to spend on infradtucure not if they have no source of revenue.

He is an idiot.


Imagine if the government spent $500 million on putting solar power on every house in the US instead of spending $2 trillion dollars invading Iraq/Afghanistan.
 
2013-03-15 11:11:08 PM

jpo2269: Without getting too political, it does seem the Nordic version of austerity has worked.

http://www.economist.com/news/special-report/21570840-nordic-countri es -are-reinventing-their-model-capitalism-says-adrian


I'm sorry, that article reads as a bunch of ideological BS.

Firstly, that huge spike in Spending as a % of GDP has a lot to do with a recession Sweden had at the same time as it was heavily investing in its future.  Government spending as a % of GDP drops when your recession ends, and money you spent very intelligently starts to pay off.  There was no reduction in the "welfare state", if anything there was an expansion of the programs that worked well and generated all the economic activity.

The reason "Nordic Austerity" works is because it isn't austerity, it is spending your money very wisely on social programs with an eye on long-term returns.  That, combined with pragmatic government policy based on reality and not ideology, is what makes the Nordic countries so successful.
 
2013-03-15 11:22:15 PM
Mrtraveler01:

I do not think you are wrong in how you interpreted the article, I too had a similar reaction.  What I would say is this however: 1. the amount of debt the Nordic countries had compared to the US was much less then what we experience today and especially what the future holds minus any significant changes.

You correctly point out that the Nordic public are more willing to accept govt. involvement than us in the States.  However, the article does point out that the Nordic people will accept govt. involvement as long as it works... I would hope we could agree that if our govt. had a track record of successful programs, hopefully more people would "trust" the govt.

It seems to me that the Nordic people are more concerned with what works, as opposed to playing politics and unfortunately, there are two sides of America that are only concerned with politics regardless of the outcome.
 
2013-03-16 12:04:56 AM

Ishkur: billmarshall: "austerity" means living within your means. Why is that so wrong?

It's not, but there's something you need to understand about economies: They depend on money to move through various sectors to be healthy. If money is not moving, then that's bad. The economy crashes when the money slows down or stops moving.

Now, there are all sorts of reasons why the money would stop moving that I won't get into here. But the point is the only way to get the money to start moving again is to pour a whole bunch of it into the economy. And the only way to do that is to borrow and spend.

(there are qualifiers and variable to all this, yadda yadda...mileage varies, etc.. I'm just being really simplified here)

Austerity is the belief that, if the money slows down and the economy goes into the crapper, the only way to pull out of it is to reduce or shrink the various sectors -- in effect, take more money out of the economy. That's bad, because it means there is even less money moving around than before, which makes the economy even worse.


Then you just utilize some more austerity, libtardo.

Duh.
 
2013-03-16 12:24:08 AM

Mentat: Any policy that requires your young educated citizens to flee in droves is not a success story.


You mean getting rid of hipsters and other worthless Millennials isn't a success?
 
2013-03-16 12:25:30 AM

HempHead: billmarshall: "austerity" means living within your means. Why is that so wrong? They spent money they didn't have and then had to repay it by doing without.

Once the debt is under control they can spend again and the economy will grow.

imagine if instead of spending money on BS stimulus the government had simply borrowed HALF the moneyit borrowed, thinned out government waste and cut all taxes by 50%. as long as the tax savings was invested in america. they could have then phsed the taxes back in after two yearsd  and we would be on top of the world right now.

Krugmans theory only works if the government has cash to spend on infradtucure not if they have no source of revenue.

He is an idiot.

Imagine if the government spent $500 million on putting solar power on every house in the US instead of spending $2 trillion dollars invading Iraq/Afghanistan.


Imagine if the government had spent the QE money paying off people's mortgages instead of just giving the money to the banks and keeping the mortgages on the books....
 
2013-03-16 12:29:47 AM

jpo2269: Without getting too political, it does seem the Nordic version of austerity has worked.

http://www.economist.com/news/special-report/21570840-nordic-countri es -are-reinventing-their-model-capitalism-says-adrian


There's a reason why they are choosing 1993 as the starting point.
Wonder why?
That's when Sweden's Banking Crisis and housing bubble burst.
 
2013-03-16 12:30:51 AM

untaken_name: Mentat: Any policy that requires your young educated citizens to flee in droves is not a success story.

You mean getting rid of hipsters and other worthless Millennials isn't a success?


No, it isn't.
 
2013-03-16 12:35:37 AM
I am a used book dealer...

The average value of a Kurgman book: $0.01

I don't need new crap from this man to know it's crap.
 
2013-03-16 12:48:47 AM

nmrsnr: I'm no economist, but doesn't having your GDP drop 20% before rebounding with 5% growth sound like a much worse outcome than slow consistent GDP growth of ~2% until your economy recovers?


Yeah, but where would they get that slow and steady 2% growth from with their economy collapsing?

I the point of this is that their economy is growing because they fixed their problems.
 
2013-03-16 01:02:53 AM

wildcardjack: I am a used book dealer...

The average value of a Kurgman book: $0.01

I don't need new crap from this man to know it's crap.


Well, I'm convinced.
 
2013-03-16 01:28:09 AM

billmarshall: "austerity" means living within your means. Why is that so wrong? They spent money they didn't have and then had to repay it by doing without.

Once the debt is under control they can spend again and the economy will grow.

imagine if instead of spending money on BS stimulus the government had simply borrowed HALF the moneyit borrowed, thinned out government waste and cut all taxes by 50%. as long as the tax savings was invested in america. they could have then phsed the taxes back in after two yearsd  and we would be on top of the world right now.

Krugmans theory only works if the government has cash to spend on infradtucure not if they have no source of revenue.

He is an idiot.


It also operates on the theory that someone wants to buy your debt indefinately until the economy turns around. Easier for the US, but how long would a country like Latvia be able to do so? Not long. Who wants to buy bonds that payout interest rates that are lower than inflation? He's the new Adam Smith and that worked out so well for the common person.
 
2013-03-16 02:02:38 AM
Greece
 
2013-03-16 02:11:20 AM

Princess Ryans Knickers: Greece


That's the word
 
2013-03-16 02:22:42 AM

zerkalo: Princess Ryans Knickers: Greece

That's the word


And who would keep buying their bonds until they magically spend themselves out their current crisis? They are a solid B-.
 
2013-03-16 02:30:08 AM
Absolutism is stupid.  Krugman needs to chill out.
 
2013-03-16 02:30:54 AM

No doubt we'd all understand Latvia and Estonia better if someone, maybe someone on Fark, could explain this situation with an analogy.  Maybe an analogy involving the trading of coconuts and fish.  Or maybe digging ditches.  Or perhaps via the follies of building bridges.  If only we had someone like that.  On Fark.


www.gridirongenerals.com
 
2013-03-16 02:48:41 AM

KittyGlitterSparkles: zerkalo: Princess Ryans Knickers: Greece

That's the word

And who would keep buying their bonds until they magically spend themselves out their current crisis? They are a solid B-.


That's what you heard
 
2013-03-16 03:21:25 AM

IlGreven: billmarshall: "austerity" means living within your means.

Austerity means no outlays, period.  If you were a family, that means no phone, no cable, no internet (sound reasonable so far?), no gas, no electric, no water (not reasonable to you?), no rent, no mortgage, no car, no house (good luck finding a place to live and a way to work), no insurance of any sort, as little on food and clothing as possible.


Right, and this is why I find all this talk about "austerity" measures in Europe to be laughable, really.

I'll give you an example of true austerity from Ceausescu's Romania.
During the 70s, the West had a relatively positive view of Romania and Ceausescu, mainly because they saw him as a critical voice of Soviet involvement in Europe (see his reaction to the Prague spring etc.). As a result, Romania was able to borrow a sizable amount of cash from the West, which the Communist party promptly squandered away.
As a result, Ceausescu somehow decided that foreign debt is bad, and pretty much ran the country into the ground trying to pay back the entire debt in one decade (the 80s). That was true austerity: a great deal of what Romanians did produce was used to pay off foreign creditors. Meanwhile, food was rationed to the gram and most of the time you couldn't find it in stores anyway. Gas was rationed, electricity was rationed. You get the picture.
In the old hack's defense, by the time we killed him he had actually managed to pay back the entire foreign debt, but at what price?

What's going on in Europe right now is like a family taking a look at its finances, realizing that they're spending way more than they're bringing in, and deciding "okay no more iPhones for a while, I guess some Droids will have to do for now", reduce their deficit by a little bit, use that as "leverage" to get the bank to give them a little more time to pay back what they owe, and call that "austerity".

/ Oh, and someone mentioned that "austerity" measures need to be run during a boom, to pay for the recession. Good luck with that. If you're a politician anywhere in Southern Europe, you've just dynamited any chances you had of getting re-elected.
 
2013-03-16 03:22:44 AM

untaken_name: Mentat: Any policy that requires your young educated citizens to flee in droves is not a success story.

You mean getting rid of hipsters and other worthless Millennials isn't a success?


Even just a couple years ago, eveyone on fark was complaining about the boomer generation. Now they're complaining about "kids these days."

It makes me smile.
 
2013-03-16 03:34:15 AM

wildcardjack: I am a used book dealer...

The average value of a Kurgman book: $0.01

I don't need new crap from this man to know it's crap.


Are there any books about a boy wizard? Maybe a series that turned its author into a squillionaire?

Let's all write!

/Not a writer yet.
//Need a muse.
 
2013-03-16 03:59:13 AM
OMG krugman is a short sided buffoon.   He'd rather a country go bankrupt later than have it be financially stable in the long term while suffering a little in the current moment.
 
2013-03-16 06:43:36 AM
The contraction that everyone is talking about happened during a financial collapse, and Latvia's response was austerity. The Farkers who worship Krugman act as if the initial contraction was caused by the government's austerity measures. Krugman predicted that Latvia's response to the financial crises would lead to continued contraction for the country. It hasn't. Thus Krugman is wrong and the zombie of Brietbart is automatically king of the world.... or something.

Look, Krugman should never have made any predictions about Latvia, or it's economy. It's tiny; with a GDP of 27 billion dollars. Any number of factors can cause huge swings in it's economy. In other words, it's experience doesn't prove anything one way or another.

If Warren Buffet stopped in the country long enough to take a shiat, the GDP would go up by 1 or 2%.
 
2013-03-16 07:18:56 AM

BigBooper: The contraction that everyone is talking about happened during a financial collapse, and Latvia's response was austerity. The Farkers who worship Krugman act as if the initial contraction was caused by the government's austerity measures.


Well no, but if you have a 24% drop in GDP and your country isn't a smoking ruin or something, you're gonna see some improvement. Latvian economic policy could have been to buy everyone in the country a ticket to a Bonnie Tyler concert and they'd have seen that 5% bounce.

BigBooper: Look, Krugman should never have made any predictions about Latvia, or it's economy. It's tiny; with a GDP of 27 billion dollars. Any number of factors can cause huge swings in it's economy. In other words, it's experience doesn't prove anything one way or another.


100% true.
 
2013-03-16 08:06:57 AM

Gunther: BigBooper: The contraction that everyone is talking about happened during a financial collapse, and Latvia's response was austerity. The Farkers who worship Krugman act as if the initial contraction was caused by the government's austerity measures.

Well no, but if you have a 24% drop in GDP and your country isn't a smoking ruin or something, you're gonna see some improvement. Latvian economic policy could have been to buy everyone in the country a ticket to a Bonnie Tyler concert and they'd have seen that 5% bounce.

BigBooper: Look, Krugman should never have made any predictions about Latvia, or it's economy. It's tiny; with a GDP of 27 billion dollars. Any number of factors can cause huge swings in it's economy. In other words, it's experience doesn't prove anything one way or another.

100% true.


Kruggers put together a new chart showing the level of austerity to GDP.  Basically, there is a linear correlation more or less between austerity and GDP, 1% of austerity relative to GDP leads to a 1% drop in GDP.  Thus, this empirically disproves Paul Ryan and the other austerity pushers policies which claim that austerity leads to growth.  Totally, factually wrong, period.  This is all about how the 1% want to keep their 15% tax rate and push the cost of our debt onto the middle class.  We should have a national referendum to ask voters whether or not to save social security and medicare, to remove the limit on SS contributions, including forms of income (i.e. dividend income must pay the 12% in SS tax).
 
2013-03-16 08:20:08 AM
Oh so NOW it's ok to be like Europe? Farking Latvia?? Godammit, I wish all of you empty headed hypocrites would move there.
 
2013-03-16 08:32:43 AM
Who cares about Latvia either way? I'm not sure many accurate comparisons can be made between our economy and theirs.

The UK, on the other hand, is back into a double-dip recession thanks to Cameron's austerity.

http://www.bbc.co.uk/news/business-17836624
 
2013-03-16 08:46:45 AM

wildcardjack: I am a used book dealer...

The average value of a Kurgman book: $0.01

I don't need new crap from this man to know it's crap.


Perhaps if you stocked Krugman books instead of Kurgman books you might have better results. Assuming you really are a used book dealer. Reason I question it? Take a look at Amazon's Krugman pages, which are somewhat at odds with your valuation:

http://www.amazon.com/s/ref=nb_sb_noss_1?url=search-alias%3Dstripboo ks &field-keywords=paul+krugman

If you're selling them for 1 cent, you have to be the dumbest used book dealer in existence.
 
2013-03-16 08:49:55 AM

Northern: This is all about how the 1% want to keep their 15% tax rate and push the cost of our debt onto the middle class.  We should have a national referendum to ask voters whether or not to save social security and medicare, to remove the limit on SS contributions, including forms of income (i.e. dividend income must pay the 12% in SS tax).


^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ ^ ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

All for it, and it's even against my own interest, since I earn quite a bit in capital gains and dividends each year.
 
2013-03-16 08:57:47 AM
Yes, because an outlier always proves the rule.
 
2013-03-16 09:59:37 AM
Why does Fark hate Latvia?
 
2013-03-16 10:03:50 AM

Phil Moskowitz: Yes, because an outlier always proves the rule.


Just as much as one man's opinion does.
 
2013-03-16 10:54:29 AM

nmrsnr: I'm no economist, but doesn't having your GDP drop 20% before rebounding with 5% growth sound like a much worse outcome than slow consistent GDP growth of ~2% until your economy recovers?


Either way - it's a country the size of a postage stamp, with an economy a fraction of the size of that of the county* I live in. Why anyone thinks this sort of thing is scalable is a mystery to me.

*No, I did not misspell "country".
 
2013-03-16 11:05:26 AM

Zeno-25: Who cares about Latvia either way? I'm not sure many accurate comparisons can be made between our economy and theirs.

The UK, on the other hand, is back into a double-dip recession thanks to Cameron's austerity.

http://www.bbc.co.uk/news/business-17836624


I think the UK is going for the quadruple-lindy-dip recession - an extremely difficult move. It will impress the Austrian judges, however..
 
2013-03-16 11:16:54 AM

untaken_name: HempHead: billmarshall: "austerity" means living within your means. Why is that so wrong? They spent money they didn't have and then had to repay it by doing without.

Once the debt is under control they can spend again and the economy will grow.

imagine if instead of spending money on BS stimulus the government had simply borrowed HALF the moneyit borrowed, thinned out government waste and cut all taxes by 50%. as long as the tax savings was invested in america. they could have then phsed the taxes back in after two yearsd  and we would be on top of the world right now.

Krugmans theory only works if the government has cash to spend on infradtucure not if they have no source of revenue.

He is an idiot.

Imagine if the government spent $500 million on putting solar power on every house in the US instead of spending $2 trillion dollars invading Iraq/Afghanistan.

Imagine if the government had spent the QE money paying off people's mortgages instead of just giving the money to the banks and keeping the mortgages on the books....


So you want to give hand outs?  Instead of loans?  You'd have preferred the Fed make no money over the last few years?  And instead of handing the money to the treasury, (which by the way is not the banks), you'd have let the government not fund anything...

I just realized you have no clue what happens in QE.   I'm going to stop talking at you - I'd get better responses from a wall.
 
2013-03-16 11:27:29 AM
I find it telling that there are a multitude of reasons that Latvia's solution was a horrible idea, from the 24% contraction of their economy to a gigantic brain drain of younger Latvians, and the response is pretty much word for word "2% growth, Krugman is technically wrong, the best kind of wrong"

Yes, you can recover from shooting yourself in the foot. The idea is not to shoot yourself in the foot in the first place.
 
2013-03-16 11:32:34 AM

KittyGlitterSparkles: Phil Moskowitz: Yes, because an outlier always proves the rule.

Just as much as one man's opinion does.


When that one man has a Nobel Prize in Economics, his opinion carries more weight.
 
2013-03-16 11:36:38 AM
Speaking of austerity:

President Barack Obama told Senate Democrats that they should be open to changes in entitlement programs to achieve a long-term budget deal, according to several lawmakers who attended a meeting with him on Capitol Hill today.

The drive for American austerity is going on right now and our President is leading it.

Mind you, this is only weeks after the Democrats and Republicans worked together to prevent the Bush tax cuts for Billionaires from expiring.
 
2013-03-16 11:39:12 AM

nmrsnr: I'm no economist, but doesn't having your GDP drop 20% before rebounding with 5% growth sound like a much worse outcome than slow consistent GDP growth of ~2% until your economy recovers?


GDP is an indirect metric of an economy's health. It can and has been juiced (China) to give an appearance of a healthier economy.

The cult of the Holy Formulae are the predominant voices in economics though.
 
2013-03-16 11:47:53 AM

giftedmadness: He'd rather a country go bankrupt later than have it be financially stable in the long term while suffering a little in the current moment.


Austerity is not "suffering a little" and anyone who tries to convince you otherwise doesn't know what they're talking about.

Austerity is nothing to take lightly and the people who think that going through Austerity is simple and painless is a fool.
 
2013-03-16 11:49:14 AM
I remember Estonia's president getting in a tiff with Krugman ... so are all these Latvian immigrants helping the Irish economy again?
 
2013-03-16 12:32:57 PM

Speaker2Animals: wildcardjack: I am a used book dealer...

The average value of a Kurgman book: $0.01

I don't need new crap from this man to know it's crap.

Perhaps if you stocked Krugman books instead of Kurgman books you might have better results. Assuming you really are a used book dealer. Reason I question it? Take a look at Amazon's Krugman pages, which are somewhat at odds with your valuation:

http://www.amazon.com/s/ref=nb_sb_noss_1?url=search-alias%3Dstripboo ks &field-keywords=paul+krugman

If you're selling them for 1 cent, you have to be the dumbest used book dealer in existence.


Hey!  You weren't supposed to check him - you were just supposed to take his bare assertion as fact!!!

/It's going to take decades before the right figures out that they can be fact-checked in an instant
//now don't go checking to see if he really is a used book dealer now
 
2013-03-17 04:49:44 AM
So were all the emmigrants the Russian transplans the commies brought in there?
 
2013-03-17 02:40:26 PM

fatalvenom: Why does Fark hate Latvia?


Because they can't find it on the map
 
2013-03-17 06:11:55 PM

Speaker2Animals: If you're selling them for 1 cent, you have to be the dumbest used book dealer in existence.


You beat me to it.  Note in particular the 40 offers for used Econ for $120+ each.  I was going to ask where his store was so I could make a fortune.
 
2013-03-18 11:50:30 AM

MadHatter500: untaken_name: HempHead: billmarshall: "austerity" means living within your means. Why is that so wrong? They spent money they didn't have and then had to repay it by doing without.

Once the debt is under control they can spend again and the economy will grow.

imagine if instead of spending money on BS stimulus the government had simply borrowed HALF the moneyit borrowed, thinned out government waste and cut all taxes by 50%. as long as the tax savings was invested in america. they could have then phsed the taxes back in after two yearsd  and we would be on top of the world right now.

Krugmans theory only works if the government has cash to spend on infradtucure not if they have no source of revenue.

He is an idiot.

Imagine if the government spent $500 million on putting solar power on every house in the US instead of spending $2 trillion dollars invading Iraq/Afghanistan.

Imagine if the government had spent the QE money paying off people's mortgages instead of just giving the money to the banks and keeping the mortgages on the books....

So you want to give hand outs?  Instead of loans?  You'd have preferred the Fed make no money over the last few years?  And instead of handing the money to the treasury, (which by the way is not the banks), you'd have let the government not fund anything...

I just realized you have no clue what happens in QE.   I'm going to stop talking at you - I'd get better responses from a wall.


Yeah trickle down.  Reagan is smiling from his grave.  Does your reply apply to the solar energy give away as well?
 
2013-03-19 07:14:19 AM

JasonOfOrillia: Hurray, an autoplay video.  CNBC you are off my whitelist.


THIS!

fark those things. man i hate that. i dont WANT to listen to some horrible journalist, i want to READ.
 
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