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March 08, 2010



Well you have a point. Regulations are fine, but people are naturally greedy and corrupt, so the regulations might not be applied so well. Look at all those child molestor laws they passed the last few years. We have so many tough sentencing laws now and they are STILL not being applied because the prosecutors don't want to deal.

Hmmm. So what to do. Well ideally, we could come up with some regulations to smooth out the business cycle. But if we can't, a good strong recession will take care of it for us.


"Splunge, and I'm not being indecisive"


But here's a thought. Free market fundie ideas are fine. But have we come to a point in society where they will not work any more?

To have free market fundie, you need to have choice and options and competition and knowledge. Are we getting to a point with large global businesses and complicated financial structures where there is little knowledge and choice any more. Just something to ponder.


To expand on my thoughts, most of the financial crises are being done in shady derivative markets, in huge amounts, crossing global lines by banks and executives most people have no idea about. And as we've seen, this shady and huge financial market is rife for disaster.

So times are different now. Maybe because this is thanks to the internet now, although we've had it for a while, high speed is pretty new, also the apps for internet commerce took a while to develop. So I think we need to try for more regulations. They might not always work, but at least we can try.


"It was largely thanks to this ideology that regulators ignored the mounting risks."

Yes I think Krugman has a point. It was a leftover from Reagan. But I think it was a combination of the things Krugman listed. Reagan ideaology. New internet tech to facilitate globalizations and speed of transfer. My own theory on a leftover from the sexual revolutuion, which led to more single households and the sudden increase in demand for more housing, which was basically temporary in nature, especially now that the population increase is slowing.

So either we think up better free market ways to guard against this, or we come up with more regs, imperfect though they may be.


Whenever the topic is Krugman, only one kind of pipe should call. Do you do drugs, Danny? Every day.

Rob Crawford

What does it take for a leftist to be drummed out of public life?

Krugman gushed about Enron; he backed Barney Frank et.al. when they blocked the Bush administration's attempt to reign in Fannie Mae/Freddie Mac; he's all for the nationalization of the health care industry; he's contradicted his scholarly work multiple times. He's a joke, a cruel joke, and the audience for his scribblings should be reduced to the nice guys who scrub the crayon off the wall once a week.

Frankly, I'm beginning to think that giving someone a regular spot in the NYT editorials page should be taken as a signal to ignore everything they say; the pundit equivalent to donning a red nose, clown shoes, codpiece and nothing else. Our national discourse would be vastly improved without Krugman, Friedman, Brooks, Dowd, etc.

W. R.

What really mattered was free-market fundamentalism. This is what led Ronald Reagan to declare that deregulation would solve the problems of thrift institutions — the actual result was huge losses, followed by a gigantic taxpayer bailout —

Like all Keynsian economics this is half right. As interest rates skyrocketed in the 80s, thrifts could not compete for deposites while restricted to safer investments, so restrictions were relaxed. The Government, through FDIC, still insured those deposites. Bankers ran wild making risking investments that were, in fact, low risk since the money used was insured from loss by the Fed: (limit on insured deposites was increased in 80s from $25K to $100K, just to make it worse).

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