This is the death knell for austerity.
In the wake of the now famous economics paper demonstrating a blunder in Kenneth Rogoff and Carmen Reinhart's study of the effects of debt on growth, titans of finance are now clearly turning against austerity.
Jim O'Neil, chairman of Goldman Sachs Asset Management, basically pronounced austerity dead in his note Monday....
With the IMF, Goldman and Pimco are announcing that austerity has failed, you can bet that the age of austerity is very close to being over.CNBC NetNet
Wall Street Announces the Death of Austerity
John Carney | Senior Editor
Da bomb.
13 comments:
Now if only the politicians get the message. But so far I don't see them backing down from three years of stupidity.
And his CNBC will be right there providing it as much life support as possible...
The coalition in the UK won't be backing down, they've been using this nonsense as an excuse to asset strip, they'll keep going until there's an election, there's far too much public wealth left to hand over to their financial backers.
It's an absolute disgrace what's happening, and I can't see much hope of the damage being reversed either. The Labour party is still embracing the same ideology, and now we have UKIP gaining popularity, and they're another bunch of neo-lib fanatics.
The weird thing is that economists think the politicians actually listen to them. They think the politicians went for austerity because they were impressed by economists' pro-austerity theories, and that since those theories have now been discredited, the politicians will do something else.
But maybe politicians and the people who own them have just been dismantling government and subordinating the global peasantry because they seek power and control?
Like James said.
Look, the nation of Greece is now hocking valuable national assets just to make it from day to day. Why would the plutocracy take their foot off Greece's neck when they can keep the pressure on and get so many great bargains?
Exactly Dan, they're basically playing the role of useful idiots, providing politicians with their alibis. It's really a sad state of affairs, it's not like there's a mainstream media challenging the nonsense, they parrot authority without thinking twice.
If you're right, Dan, then we should see a continued acceleration toward austerity. Time will tell I guess.
The "Age of Austerity" is only over for certain people.
We may see deficits rise and debt hysteria wane a little but all the fruits will still go to very few. We will see none of the following;
1) Debt writedowns for average people on a meaningful scale
2) Jobs focus where a public job is not derided. If an owner doesnt hire you its not really a job and you can still be sneered at.
3) Removals of payroll taxes WITHOUT offsetting cuts somewhere else (cuts that dont affect the 1% directly)
4) Real emphasis on limiting the health care costs on the average family.
There is no doubt that many owners must be starting to see increased affects of all these cuts. Will they have the sense to ask the right questions to see the relationship between "shrinking govt" and shrinking customer base and shrinking economy? We'll see. I do think that a lot of people are going to start feeling more economic pain and start looking. If a lot more start looking a percentage of them will find and attach to MMT or MR. There is a critical mass that must/will be reached that will push this over the edge.
Goldman Sachs may be so satiated that even THEY'VE lost "interest" in even another penny.
Feeling set, they're hypocritically announcing that the peasants should be fed well enough to protect the 1%?
Urp!
They've seen the Monte Python movie, and don't want to blow up, right in their moment of victory. (They've already barfed in their spitting bucket, Congress. Even told the POTUS where to go and what to do there - and his little electorate too.)
Hence, their false modesty still leaves viewers disgusted.
Yet here's Carney, just a few posts prior to this one, where he's the ultimate apologist for Reinhart and Rogoff, saying it's no big deal and "not too many economists are bothered by their error." Read here.
Carney is such a two-faced, corporate suck up wimp. I can't stand him. He's useless.
Thanks Mike.
In my defense, I didn't write that post. It was written by Jeff Cox, my colleague here at CNBC.
I don't have a "party line" at NetNet, so you shouldn't interpret everything there as representing my opinion.
John, I put that up under your name because that is the way it appears at NetNet.
Wall Street Announces the Death of Austerity
Published: Monday, 22 Apr 2013 | 4:07 PM ET
By: John Carney
Senior Editor, CNBC.com
I assumed that you had written it for that reason and also since posts are specifically attributed to Jeff Cox.
It would be clearer at NetNet if you are more specific in the attribution, although it may never be completely clear with your name and picture in the headline.
Many people confuse what is published here by other with Mike, since it is his blog, even though we make it clear who posted it.
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