tag:blogger.com,1999:blog-2761684730989137546.post4572679549624484010..comments2024-03-28T07:50:06.102-04:00Comments on Mike Norman Economics: BIS warns about moral hazard and threat of second leg downmike normanhttp://www.blogger.com/profile/03296006882513340747noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-2761684730989137546.post-33699270673947728562012-06-24T22:38:08.703-04:002012-06-24T22:38:08.703-04:00They cut interest rates so as to encourage more le...<i>They cut interest rates so as to encourage more lending and borrowing. I couldn’t have thought of anything that stupid if I’d tried.</i><br /><br />Yeh, and when they can't goose up the bubble again thereby, the anointed experts throw up their hands and say "We're in a liquidity trap." It sounds so technocratic and value free like when the weatherman says "We're experiencing an inversion cycle."<br /><br />I'm tempted to say to these very smart people that we're not in a "liquidity trap," we're actually in a stupidity trap. But I'm just an economics naif, so what do I know.Davidhttps://www.blogger.com/profile/10929929857098326319noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-57908873100033332012-06-24T21:08:50.370-04:002012-06-24T21:08:50.370-04:00Ralph -
What's causing the inflation in the U...Ralph -<br /><br />What's causing the inflation in the UK?<br /><br />Sounds like biz is hoarding cash over there too. (Supposedly FX fears?)Unforgivennoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-77121147814888202462012-06-24T20:59:18.829-04:002012-06-24T20:59:18.829-04:00We have a credit crunch caused by excessive and ir...We have a credit crunch caused by excessive and irresponsible borrowing, and what do the dimwits in charge of Western economies do? They cut interest rates so as to encourage more lending and borrowing. I couldn’t have thought of anything that stupid if I’d tried.<br /><br />George Osborne, Britain’s finance minister, has told banks to repair their balance sheets, at the same time as telling them to lend more. Next he’ll tell bank CEOs to stand up and lie down at the same time.<br /><br />The lunatics have taken over the asylum. But I’m being negative. Now I’ll be constructive.<br /><br />There’s not much Eurozone countries can be because of the inherent defects of a common currency. Britain is constrained by its relatively high rate of inflation. As to the U.S., all it needs to do is adopt the MMT cure, i.e. create new money and spend it into the economy. But the lunatics in Congress won’t stand for that.<br /><br />So we’re all doomed.Ralph Musgravehttps://www.blogger.com/profile/09443857766263185665noreply@blogger.com