Saturday, September 03, 2011

Krugman: the beatings will continue until morale improves
When the recession officially ended, [government] spending was rising at an annual rate of around $60 billion; now it’s declining at an annual rate of $60 billion. That difference is around 1 percent of GDP, and maybe 1.5 percent once you take the multiplier into account. That makes the turn toward austerity a major factor in our growth slowdown.
Debt, Deleveraging and the Liquidity Trap

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