Saturday, July 2, 2011

John Harvey: "Why You Should Learn to Love the Deficit"


Prof. Harvey corrects the common fallacies heard about why budget deficits are bad.
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5 comments:

Craig Austin said...

why are my comments taking so long to post? I commented 30 min ago on another post and my post has still not displayed. am i being moderated? :-)

July 2, 2011 10:19 PM
Craig Austin said...

what's the deal my last comment posted immediately? it reads at the top "it may take a moment for your comment to appear" not sure if i did something wrong before or what. i posted twice and had the same result - no comment posted

July 2, 2011 10:22 PM
Craig Austin said...

never mind. third time is a charm. it posted immediately

July 2, 2011 10:31 PM
googleheim said...

@ TOM :

I had a flash of sliver of thought about Argentina during the 1990's -

In addition to the pegged currency policy, I am wondering if they were going through some sort of deficit cutting and debt relieving puritanical phase ?

They sold the water, electricity, toll road, and other municipal utilities. They must have done something to attract tons and tons of private investment ( which later cratered ). The monies received lined Menem's pockets and the richest families, but maybe ...

did they "balance the budget" in the domain of Argentine Federal treasury with the proceeds ?

did this present the false confidence in investor attraction to the neoliberal Argentine 1990's ?

By balancing the budget it only moved the bubble firmly into the real economy of Argentina and there was no Federal domain to offset and take the shock when the pop came.

The shock absorber would have been the currency fluctuation as well as government elastic monetary policy - instead they had to default.

Can anyone find out if Argentina balanced their "federal" economy to present false spreadsheets to the world so as to falsely attract investors, etc ???

this could show that deficits would have been better.

July 3, 2011 1:48 AM
Detroit Dan said...

I always like Harvey's stuff. His writing is clear and straightforward...

July 4, 2011 6:22 PM

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