http://www.bloomberg.com/news/2013-12-04/last-gasp-of-the-keynesians.html
The diagnosis? Too much saving and a lack of investment opportunities, according to Harvard University’s Summers. And with the funds rate
close to zero, the Federal Reserve can’t deliver the negative real
interest rates he says the economy needs unless it creates higher
inflation.
So what do Summers and Krugman advocate for the
secular malaise? Why, a cyclical solution: government spending on
infrastructure. They want the kinds of things Keynesians typically
promote to stabilize the economy during a recession to become a
permanent part of the fiscal architecture.
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