Sunday, January 11, 2009

HOT5 Daily 1/11/2009

1. "Borrow and Spend — Isn’t That How We Got Here?" A look at Obama's economic plan and suggestions for what we should do instead.

Representative Sample: The federal government must tighten its belt like everyone else and stop soaking up an increasing share of the economy.

2. "Rum is the Latest Weapon Against Wal-Mart" Supposedly Wal-mart will blacklist products from countries hostile to the U.S.  That's supposed to be a bad thing?

Representative Sample: managers have already been told products from Iran, North Korea and Sudan will no longer be sold at the store

3. "Reactions to racism not as strong as we think" Interesting results of a recent study on racism.

Representative Sample: many people imagine they would respond strongly to a racist act but actually respond with indifference

4. "Zeppelins: A Noble History, A Respectable Russian Comeback"  Russia to build zeppelins? An informative look at the history and current prospects of zeppelins.

Representative Sample:  The new zeppelin will offer much to the world of space travel and aircraft. It can be used in a myriad of ways 

5. "Interesting Facts About Turkey" A list of interesting facts about Turkey.

Representative Sample: Istanbul is the only city in the world built on two continents.

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  1. Only government can break the vicious cycles that are crippling our economy? Okay, so the government is going to borrow and spend $1 trillion dollars, give or take a few billion, and that is going to solve the problem. Borrow and Spend? Isn’t that how we got here?

    Okay, this person is officially clueless of any mainstream economics. The US didn't get here with borrow and spend. It got here with borrow and spend in times of growth, which helped fuel stagflation in 2007. In times of deflationary recession, e.g. now, deficit spending is a positive thing.

    You don't have to agree with Krugman's diagnosis of liquidity traps. Tyler Cowen and Greg Mankiw don't. But you have to address it somehow. At a minimum, I expect the writer to understand the issue enough to be able to explain Mankiw's argument briefly.

  2. "In times of deflationary recession, e.g. now, deficit spending is a positive thing."

    In theory, yes. But not in everyone's theories.