TODAY'S recommended economics writing:
• The Federal Reserve's utter policy failure (Atlantic)
• China in GDP shock (FT Alphaville)
• Hard times lift Greece's anti-immigrant fringe (New York Times)
• Bearish on Brazil (Foreign Affairs)
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Readers' comments
The Economist welcomes your views. Please stay on topic and be respectful of other readers. Review our comments policy.
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Sheila Blair has a rather amusing opinion piece at Washington Post entitled "Fix income inequality with $10 million loans for everyone!"
http://www.washingtonpost.com/opinions/fix-income-inequality-with-10-mil...
The Atlantic:
The American public education system is by many accounts a train wreck. We consistently fail to motivate and educate the poorest third of our children. Poignantly, we even seem to be failing poor children who score highly on aptitude tests when they are very young.
How about a bizarre concept.
How about "self-motivation"?
The writer thinks he can force a horse to drink.
Without developing skills in math
We have plenty of skills in math.
A house cost is free if one whines to the media about not having the mortgage money after paying for cellphones, lattes, cableTV in every room, a computer for every memeber of the house, expensive vacations, Aeropostal (spelling) clothing.
College is free also. Just take on tons of debt, and then whine to the media.
More or our citizens will live in poverty.
No they won't, Mr. Smith and the Fed wants people to live luxuriously by borrowing, spending, and not payiing back. Why else would they leave/want long term rates low?
(Don't worry, the Fed has shown it will buy the worthless debts.)
This is not the fault of fiscal policy. This is not the fault of microeconomic problems like poor education or a crumbling infrastructure. This is not the fault of a private sector that is unwilling to do its part.
What?!
The author starts with a premis that the Fed is the problem, and then twists everything wrong that Americans as individuals do into it being the fault of the Fed.
THIS is what is wrong with our economy.
----
The Federal Reserve knows exactly what it needs to do to remedy this situation: commit to zero interest rates until nominal spending in the US economy is within 2% of its 1990- 2007 trend line.
In 1990 our TOTAL DEBT/GDP was 237.3%
In 2007 our TOTAL DEBT/GDP was 362.6%
That "trend line" was built on an UNSUSTAINABLE GROWTH OF DEBT.
My math shows a 58% increase (362.6/237.3)-1
Give me your credit card Mr. Smith.
I'll go into a small town of 5 businesses and stimulate that town's economy.
Regards
"What?!
The author starts with a premis that the Fed is the problem, and then twists everything wrong that Americans as individuals do into it being the fault of the Fed.
THIS is what is wrong with our economy."
No, THIS is what is wrong with our economy. Thanks to your post we can add reading comprehension to the list of American failings.
The Economist welcomes your views. Please stay on topic and be respectful of other readers.
Regards
Backseat modding, a close substitute for coherent thoughts since 1978.
Do you at least see what you missed? If I had to guess I'd say it was this part: "However, the macro-economy will be steady and the Fed will have done its job."
Steady and job done if the Fed bails people - you?, the author? - out of their debts.
Regards
Sure, why not? We bail out lenders in this country with our FDIC and our newly-ironclad promise of a TARP if anything ever goes bad with a big bank in the future. If bailing out the unemployed also bails out the indebted, I don't see how that's inconsistent with the economic principles we enshrined in law.
Per Nomura, per the FT -
"On the back of these data, we judge that our 2012 GDP growth forecast of 8.2% may be too low. We are currently reviewing this forecast."
To the extent that China's GDP numbers can be believed, its economy is a dang rocket ship.