This news story has 7 comments:

Register or Login to rate comments »
•  
  

  • user344210: 
  • Comments (148)
  At $787 billion (plus interest) that stimulus has to be the most expensive "non-trying" of something in history. How did intellectual discourse get so degraded in the West, that this passes for smart thinking?

  Aug 07 07:37 PM | Link | Reply
•  
  

  • Balderdash: 
  • Comments (61)
  •  • Instablog (2)
  The state of the economics profession in the upper tiers of government and academia is pathetic. A prize winning professor of economics argues for fighting a debt crisis with more debt or taxation, completely ignoring the 'forgotten man' fallacy: that government excessive borrowing crowds out other borrowing, and it is usually spent on non-productive projects. Taking savings from one man (even if he's Chinese) deprives the world of much needed capital. How bailing out state governments or make-work projects add to the asset side of the government balance sheet is beyond me.

  Aug 07 08:01 PM | Link | Reply
•  
  

  • The Geoffster: 
  • Comments (1151)
  The only way Keynesian pump priming works is by stimulating the multiplier effect of M1. With all the cash sitting in the banks' reserve accounts with the Fed, this money will have to find its way into the economy. So far it hasn't. The banks have been using it to shore up their balance sheets. As a result, the stimulus money, all of which is borrowed, hasn't produced results. When it does, it will have to provide enough of a multiplier to service the debt. Stiglitz wants to throw more borrowed money at the problem. If it works, M1 will explode, the economy will roar and the price of hard assets will go through the roof.

  Aug 07 08:09 PM | Link | Reply
•  
  

  • Mr. Ed, Jr.: 
  • Comments (492)
  "Indeed, what is needed now is another dose of fiscal stimulus. If that doesn't happen, we can look forward to an even longer period in which the economy operates below capacity, with high unemployment."
  
  
  Sounds like a threat.
  
  
  "Some worry about America's increasing national debt. But if a new stimulus is well designed, with much of the money spent on assets, the fiscal position and future growth can actually be made stronger."
  
  
  Maybe someone should have thought about a "well designed" stimulus last time. Perhaps, if they had read it...
  
  
  At a time of great financial peril to our nation, we were betrayed. Willfully and intentionally.
  
  In the history of this country, there may not be more clear cut evidence that everyone-- EVERYONE-- who voted for the last stimulus has betrayed the trust of the American people.
  
  And these non-representing representatives knew exactly how serious the crisis was, because after they were briefed by then Treasury Secretary Paulson, a number of them immediately dumped their stocks-- presumably bought by fellow citizens who were not briefed on the impending financial collapse.
  
  Then they wrote a stimulus bill to help themselves get re-elected, rather than help the nation.
  
  They should all apologize to the American people, then immediately resign. Their "services" are no longer needed.

  Aug 07 08:44 PM | Link | Reply
•  
  

  • Whitehawk: 
  • Comments (75)
  •  • StockTalk (1)
  GDP = C+I+G+(Ex-Im)
  
  Increasing G to throttle C will crowd out I. G ~ 2*I when it ought to be the other way around. The Japanese found out the hard way about Keynesian economics - it choked their GDP.

  Aug 07 08:51 PM | Link | Reply
•  
  

  • DrBenway: 
  • Comments (76)
  Amazing. Is this supply side socialism? Deficits don't matter because in the future a Big Benevolent State will magically take care of everyone anyway?
  
  Keynesian Economics has been tried many times and consistently failed for one reason only: it is false.

  Aug 08 02:54 AM | Link | Reply
•  
  

  • Sanjeev Sharma: 
  • Comments (25)
  •  • Instablog (6)
  •  • StockTalk (2)

  • •
  • http://thinking-simple.blogspot.com
  Good to get support for additional stimulus by Prof Stiglitz.
  
  However, Prof Stiglitz would have been more helpful if he had given the 'amount' of additional stimulus required and elaborated on the details of the 'assets' the government should build with the stimulus.

  Aug 08 10:09 AM | Link | Reply