Saturday, November 16, 2013

bubbles (updated)

Secular Stagnation, Coalmines, Bubbles, and Larry Summers by Krugman

Bubbles Are Not Funny by Dean Baker

Bubbles, Regulation, and Secular Stagnation by Krugman (Sept. 25, 2013)

Need to increase demand to achieve full employment without bubbles or above moderate inflation. Inflation will help with deleveraging. Increase demand via more exports. Via monetary policy (see Abenomics). Via fiscal policy. State and local governments are now small tailwind. Federal has the sequester but deficit/debt no longer and issue so probably less austerity going forward. Via supply (shorter hours) and organized labor.


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