Kint

Why Krugman's Analysis of Economists Is Wrong

I'm not sure you understand Krugman's argument - what Krugman is arguing is, monetarists economists are the ones who live in a bubble. Their theory is based on numbers and math, and that capitalism is a perfect system. Krugman says monetarists argue that stock prices reflect all available information - the system balances itself, so very little regulation is required. The non-Keynesian view was there couldn't be a housing bubble, because markets are perfectly efficient - and only behaviorists and Keynesians saw the crisis coming. As we've seen in the CDS market, the one system with no regulation is the one that brought down the whole system. If you accept Krugman's premise, then his argument is perfectly valid.

When to Be a Contrarian

Good post..it takes a strong stomach to do what you say, but it pays off.

Four Reasons We're Headed Even Higher

Good article.. also, good job on your stock picks.

Japan's Past = Our Future?

Agree with Andrew.. we have different social contracts.. actually, what Japan is experiencing now is what we experienced in the late 60s.

Coming Soon: Banking Crisis of Historic Proportions

This article is wrong.. where was this biting analysis *before* it happened? Your error is that you're plotting the future based on past trajectory, which is what people did before the subprime meltdown (home prices will never go down!).. you're making the error on the other side now.

Europe Is Recovering More Quickly than U.S. - Why?

Chap08 got it right.. also, b/c of the social contract the Europeans have, they almost have a built-in recession, so it wasn't much of a shock to their economies b/c it wasn't high to begin with. Unemployment rates in France and post-unification Germany have generally been around 8-9%.. so what we call high unemployment, they call "unemployment."

Economists' Views on Trade Deficit Increase

Wait - you mean free markets actually work? Who would've thunk it..

Case-Shiller Home Prices Rise in May, But Don't Read Too Much into This

That chart is hard to read.. the only easy city to see is New York. How about a chart where if you mouse over the city, the line comes to the forefront?

A Reality Check on U.S. 'Economic Recovery'

On Jul 30 03:07 PM thiazole wrote:
> If you believe that, then how do you know that it wasn't lies and
> fabrications that sank the market in the first place? If I were
> ever to subscribe to a conspiracy theory (which I won't), it would

Agreed - and also, how do you know that the market doesn't know about those bank properties being kept off the market, and as the old cliche goes, the information has already been built-in to the prices?

Bad Unemployment News for the Unskilled

Makes sense.. we need more college graduates anyway, if we're to compete with the likes of China, Japan, Germany, etc..

The Government's Role in the Housing Bubble

When a bubble situation starts, it becomes a self-feeding cycle.. I'm not sure if I buy the low interest argument, but when people start seeing home prices rise and the bubble mentality takes hold, all rational thought goes out the window.

Efficient Markets vs. CAPM

Bogle is a visionary, but props also need to be given to Malkiel for popularizing the idea of index funds..

I Was Wrong About GM Bankruptcy

Good to see someone own up to their predictions.. unlike some talking heads.. <cough> Cramer </cough>

Why CRA Loans Weren't Toxic Subprime Loans

Remember, there was demand for CDOs at the height of the bubble - and the ratings agencies, banks, Wall St. investment firms all willingly played a huge part. More than anyone, they are to blame.

The Coming Economic Collapse, Part 2

It's pretty clear that many of you don't understand the mechanics of free markets wrt outsourcing. Many of you view it through the prism of "all our good jobs are going, and it's threatening our way of life," which isn't true. In free markets, you can't get something for nothing. If wages are low in India or China, it's because that's how much they're worth, whether it's poor roads and other infrastructure in India, or corruption, the lack of the rule of law, or poor quality in China. If China produces a product as good as one made here, it's not possible for them to sustain low wages, just based on common sense - there is a small window of opportunity, but that window is very small. When that window does occur, though, it benefits countries on the higher food chain, because it frees them to do other more productive things - note the largest sustained period of the economic growth in American history in the 90s, when outsourcing started happening in earnest. But this window closes quickly - there are many articles, like a recent one in Businessweek, that notes that China no longer can compete on price alone (that goes to Mexico now). And if the claim is China is manipulating their currency, China is paying the price - it creates inflation internally. Again, this is not sustainable for China. It's not possible to outsource significant chunks of our economy - nothing that people like Lou Dobbs have predicted have come to pass. And really, nothing people like him say stand up to reason. Pick up an economics book - learn to reason, and think through things..