Lest We Forget
By PAUL KRUGMAN
NYT
A few months ago I found myself at a meeting of economists and finance officials, discussing — what else? — the crisis. There was a lot of soul-searching going on. One senior policy maker asked, “Why didn’t we see this coming?”
There was, of course, only one thing to say in reply, so I said it: “What do you mean ‘we,’ white man?”
Seriously, though, the official had a point. Some people say that the current crisis is unprecedented, but the truth is that there were plenty of precedents, some of them of very recent vintage. Yet these precedents were ignored. And the story of how “we” failed to see this coming has a clear policy implication — namely, that financial market reform should be pressed quickly, that it shouldn’t wait until the crisis is resolved.
About those precedents: Why did so many observers dismiss the obvious signs of a housing bubble, even though the 1990s dot-com bubble was fresh in our memories?
(More here.)
NYT
A few months ago I found myself at a meeting of economists and finance officials, discussing — what else? — the crisis. There was a lot of soul-searching going on. One senior policy maker asked, “Why didn’t we see this coming?”
There was, of course, only one thing to say in reply, so I said it: “What do you mean ‘we,’ white man?”
Seriously, though, the official had a point. Some people say that the current crisis is unprecedented, but the truth is that there were plenty of precedents, some of them of very recent vintage. Yet these precedents were ignored. And the story of how “we” failed to see this coming has a clear policy implication — namely, that financial market reform should be pressed quickly, that it shouldn’t wait until the crisis is resolved.
About those precedents: Why did so many observers dismiss the obvious signs of a housing bubble, even though the 1990s dot-com bubble was fresh in our memories?
(More here.)
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1 Comments:
Paul must of forgot that many conservatives did warn against the liberal notion of using Freddie and Fannie as tools to increase home ownership. Paul also failed to point out who received the second largest amount of donations from Freddie and Fannie and who provided advice to our President elect... a selective memory at best.
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