Paul Krugman: A Cross of Rubber

[cal04]

http://www.nytimes.com/2011/01/31/opinion/31krugman.html?partner=rssnyt&emc=rss

Last Saturday, reported The Financial Times, some of the world’s most powerful financial executives were going to hold a private meeting with finance ministers in Davos, the site of the World Economic Forum. The principal demand of the executives, the newspaper suggested, would be that governments “stop banker-bashing.” Apparently bailing bankers out after they precipitated the worst slump since the Great Depression isn’t enough — politicians have to stop hurting their feelings, too.

But the bankers also had a more substantive demand: they want higher interest rates, despite the persistence of very high unemployment in the United States and Europe, because they say that low rates are feeding inflation. And what worries me is the possibility that policy makers might actually take their advice.

(snip)
Ben Bernanke clearly understands that raising rates now would be a huge mistake. But Jean-Claude Trichet, his European counterpart, is making hawkish noises — and both the Fed and the European Central Bank are under a lot of external pressure to do the wrong thing.

They need to resist this pressure. Yes, commodity prices are up — but that’s no reason to perpetuate mass unemployment. To paraphrase William Jennings Bryan, we must not crucify our economies upon a cross of rubber.

[Vinnie From Indy]

1. It's pretty simple actually...

These guys have theirs so they could give a shit about the millions that would be pushed even further into the abyss. It would seem obvious that they are playing with a fire that could easily come back to burn them, but greed does that to people. They simply are more mesmerized by acquiring more wealth than they are afraid of reaping the whirlwind of social upheavel.