Krugman is on Fareed's show now on CNN

[sfpcjock]

Topics including: the SP downgrade and market bust, the situation in Britain.

The IMF egghead on with Krugman just said that the US downgrade is "well-earned".

[gateley]

1. Where is Fareed's show? Thanks. nt

[sfpcjock]

2. on CNN now

[gateley]

3. Thank you. nt

[Demoiselle]

4. The EggHead (well named) had me bouncing off the walls in fury..

Saw the early broadcast. Krugman is, as always, right, and that smug bastard was mouthing the usual bullshit. Bullshit with a Smirk. Krugman is always patient, but he was rolling his eyes this time. And, of course, at the end, the Media has offered us "Two Sides" to a story that really only has one correct side...Krugman's. AAAARRRRRRRGHHHHHH!!!!!!!

[Strelnikov_]

5. Shape of earth, opinions differ n/t

[Demoiselle]

12. Nice one! nt

[Strelnikov_]

16. Paul Krugman

http://www.nytimes.com/2005/08/05/opinion/05krugman.html

Even when reporters do know the difference, the conventions of he-said-she-said journalism get in the way of conveying that knowledge to readers. I once joked that if President Bush said that the Earth was flat, the headlines of news articles would read, "Opinions Differ on Shape of the Earth." The headlines on many articles about the intelligent design controversy come pretty close.

[Demoiselle]

17. I should have recognized that.

Thanks. He makes such heroic attempts to tell us the truth. He's a hero of mine.

[sfpcjock]

6. It's good to remember one thing Krugman said:

"The U.S. can borrow money and repay in constant dollars less than it borrowed."

...and since the government is currently the spender of last resort, it is necessary.

The IMF, um... guy compared necessary infrastructure work to "ditch digging/refilling" and "unproductive because it leaves debt". That is pure and unadulterated BS, and I find it stultifying that someone so highly educated would introduce that argument. He is awful. (Ken Rogoff is his name, I believe.)

[jwirr]

7. The IMF guy is talking pure disaster capitalism. Yes, pure BS.

[dkf]

8. That means the US will print money and buying our bonds will mean no gains and maybe even worse

As we pay our other debts by printing money.

So we don't default, we just mooch using our ability to print. That isn't a winning sales pitch for buying our bonds.

In China's eyes this IS a default.

[sfpcjock]

9. I wish you would look at the show carefully...

in case you haven't yet. Even Krugman expressed some qualms about the effect of long-term borrowing, but almost everybody--including 70% of Americans polled--agrees that it's things like long-term value infrastructure work that completely return the investment, if not more than the investment. BTW, it is not the so-called monetary or money-printing solution that the Fed sometimes resorts to in this case. The fiscal solution of borrowing the money to make valuable investments actually allows us to pay it back for less than it cost us to borrow it.

Also, China owns only about 10% of our bond debt. The show even discussed what would happen if China pulled the plug on their share--and why they won't do it. Since all our factories are there now, China needs the ready market to unload the goods. If they dumped U.S. bonds--which are safe in the eyes of the world--everyone would immediately sell dollar currency holdings and the exchange rate would become unfavorable to them selling goods to us.

Finally, when 70% of the crowd in its wisdom says anything... it's probably very true and should be heeded. Right now the GOP is not doing that. They are ignoring the wisdom of the crowd at their own peril.

http://www.CNN.com/video - to see it online

[mmonk]

11. Taxes are preferable but since that avenue was surrendered,

borrowing is the temporary solution to a long term problem without a real job stimulus (creation of work to create salaries which pay for items that increase demand in the economy).

[girl gone mad]

13. No, that isn't what Krugman is saying.

And, no, China would not view monetization as a default.

[JHB]

15. "Ditch digging/refilling" is only unproductive if...

...one already has all the ditches one needs. When it repairs existing infrastructure or creates new systems, it's productive.

Not to mention it employs people, giving them income, which produces demand, which will make it more attractive for businesses to hire to fill that demand, which reduces unemployment, which reduces the need for these stopgap jobs, etc.

I'd think someone from the IMF would be familiar with the concept of "positive feedback loop". :sarcasm:

[sfpcjock]

10. How to Fix the Economy (Parts 1 - 2)-- August 14, 2011

Here you go. Panel starts at about 4:00

http://www.youtube.com/watch?v=KwCuZshDaSg"> How to Fix the Economy (Part 1 of 2)-- August 14, 2011

http://www.youtube.com/watch?v=EoyuDg9ZNKs"> How to Fix the Economy (Part 2 of 2)-- August 14, 2011

[ImOnOne]

14. thanks