Global Collapses Are A Systemic Outcome Of Reaganomics-YES REAGANOMICS-Rinse & Repeat

[kpete]

Global collapses are a systemic outcome of Reaganomics: Simon Johnson
by whataretheysmoking
Thu Mar 11, 2010 at 07:19:05 AM PST

Since the '80s, private sector debt to GDP has kept growing. So did the transfer of risk to society as a whole because of our regulatory system. There's nothing to discourage the excessive risk-taking and gambling that the system enables despite attempts at "regulatory oversight". The cycle will repeat itself.

http://www.dailykos.com/storyonly/2010/3/11/845101/-Global-collapses-are-a-systemic-outcome-of-Reaganomics:-Simon-Johnson-

The doomsday cycle

Peter Boone Simon Johnson
22 February 2010

.........................

Over the last three decades, the US financial system has tripled in size, as measured by total credit relative to GDP (see Figure 1). Each time the system runs into problems, the Federal Reserve quickly lowers interest rates to revive it. These crises appear to be getting worse and worse – and their impact is increasingly global. Not only are interest rates near zero around the world, but many countries are on fiscal trajectories that require major changes to avoid eventual financial collapse.



Given the inability of our political and social systems to handle the hardship that would follow economic collapse, we rely on our central banks to cut interest rates and direct credits to bail out the loss-makers. While the faces tend to change, each central bank and government operates similarly. This time, it was Mervyn King, Gordon Brown, Tim Geithner and Ben Bernanke who oversaw policy as the bubble was inflating – and are now designing our rescue.

When the bailout is done, we start all over again. This has been the pattern in many developed countries since the mid-1970s – a date that coincides with significant macroeconomic and regulatory change, including the end of the Bretton Woods fixed exchange rate systems, reduced capital controls in rich countries and the beginning of 20 years of regulatory easing. The real danger is that as this cycle continues, the scale of the problem is getting bigger. If each cycle requires greater and greater public intervention, we will surely eventually collapse.

much more:
http://www.voxeu.org/index.php?q=node/4659

[indepat]

1. Enough to make one wonder if the Great Depression were but prologue to an epic depression

in the brew, thanks in no small part to idiotically irresponsible RW voodoo economics. :P

[FarCenter]

2. Reagan was just Maggie Thatcher's tool

He wasn't smart enough to deal with economic theory by himself.

[Romulox]

3. I'm failing to grasp the principle distinctions between Reaganomics and Obamanomics?

:shrug:

[ananda]

4. LOL

I don't think voodoo, "trickle down" economics is supposed
to be "grasped" by anyone but the "flood-up" profiteers.

[Vincardog]

5. the principle distinction is the first 4 letters

[branders seine]

6. scary, considering Obama and his entire economic team are

economic reaganistas

[Birthmark]

7. About time Reagan got the credit he deserves

He was a dimwit who sold out America for a little superficial success (and it was very little).

But I guess he was likeable.