"ROUBINI: We Just Saw A 'Mini Perfect Storm'"

[applegrove]

ROUBINI: We Just Saw A 'Mini Perfect Storm'

by Joe Weisenthal at Business Insider

http://www.businessinsider.com/nouriel-roubini-mini-perfect-storm-2014-1

"SNIP..................................



What do policy makers need to address going forward?

They need to have polices that restore stronger growth. There is a risk that if people are unemployed long enough they atrophy, they lose skills, so I think we have not done enough on boosting aggregate demand by using appropriate monetary and fiscal policies or even credit easing.

I think the long-term issues that the tech gurus here all excited about — innovation from IT to energy technology to biotech to new manufacturing technology like robots automation, and so on — the problem with all these great innovations is that they tend to be capital intensive, skill biased, and result in labor savings. We have a structural problem with job creation, so I would think about changing the taxation of labor versus capital, how we invest in better educational systems, vocational schools, and reducing payroll taxes as a way to increase demand for labor. Otherwise you have vicious cycle of little job creation, a rise in the share of profits and GDP, redistributing form those spending to those saving, that further reduces aggregate demand.

So inequality was also a theme. You have here not just the top 1% but the top 0.01%, So between technology, globalization, trade, the winner-take-all superstar effect, inequality is rising. This is not just a "moral" issue but also an issue of too little consumption too little savings that is bad for global growth.

So it becomes vicious cycle. It's a bit like the old Marxist idea that if profits grow too much compared to wages, there's not going to be enough consumption, and capitalism is going to self destruct. So I think that insight of Karl Marx is as useful today as it was 100 years ago.



..................................SNIP"

[elleng]

1. Yes, and the repugs WON'T allow long-term, positive responses:

Can't have successful Dem administrations, after all.

[Fridays Child]

2. The one percent is completely blinded by greed.

When they're done wringing every last bit of productivity out the rest of us, everything will collapse. They will not be able to hide from the total destruction and havoc they're wreaking.

[applegrove]

3. The Daily Show did a bit on those elites in Davos (priviledged) discussing inequality and

"if those poor people really cared they would have showed up at Davos".

[randome]

4. Governments are the enablers.

The one percent are only behaving according to rote.
[hr][font color="blue"][center]“If you're not committed to anything, you're just taking up space.”
Gregory Peck, Mirage (1965)[/center][/font][hr]