Words of wisdom from Riotstan
8.11.2011 Leave a comment
The Guardian today reports that the aristocrat George Osborne, currently Britain’s Chancellor of the Exchequer, feels optimistic about the future and Britain:
The chancellor used his emergency statement to parliament to say that recent events in the global economy had “vindicated” the government’s deficit reduction programme, putting in a bullish performance after the Bank of England downgraded its UK growth forecasts for the fifth time this year.
George Osborne made the second of two emergency government statements, speaking after nine days of economic upheaval and one day after Bank of England governor Sir Mervyn King warned of more economic “turbulence” ahead, saying “headwinds were becoming stronger by the day”.
In his statement, Osborne acknowledged this squall of bad economic news, saying the FTSE had fared badly in the past month. “The huge overhang of debt means the recovery will be longer and harder than we had hoped,” he said.
“This is the most dangerous time for the global economy since 2008, and we should be clear about that.”
But he sought to turn events to his advantage, telling parliament the UK had become a “safe haven” for stock markets in recent days, with the unpredictability of stocks making an investment in UK bonds more attractive. Referring to recent market turbulence, he said: “The market for our government bonds has benefited.”

Tory Realism
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Finding good sense in the Wall Street Journal
8.8.2011 Leave a comment
Economist Ha-Joon Chang rightly informs his readers that the first phase of the post-2008 recovery had a distinct Keynesian flavor, and included activist government and stimulus spending. Most governments eventually abandoned the Keynesian approach, replacing it with one that reflected neoliberal verities. Ha-Joon Chang believes the neoliberal approach will end in failure. His reasons focus on the false premises embedded in that approach. These premises are:
Succinctly put, Chang’s analysis reflects an approach to modern economies which treats them as demand-constrained, not supply-constrained. I can’t argue with that.
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Filed under Commentary Tagged with Demand Constrained Economy, Ha-Joon Chang, Keynesian economics, Market Fundamentalism, Neoliberalism, Reactionary Economics, Stagnation