http://www.nytimes.com/2014/09/15/opinion/paul-krugman-how-to-get-economic-policy-wrong.html?_r=0
Paul Krugman writes this article to explain his opinion of the 2008 crisis. He blames economists for sugar-coating forecasting and he says that economists would only report on what they wanted to hear. He says that no one predicted the crisis because of our idealized view of capitalism. At the time we thought the market could never crash and that it would always be perfectly functional.
He does say that we had a good lesson from this 2008 crisis. We were able to accurately forecast the aftermath of the crisis predicting there would be low interest rates when it comes to budget deficits as well as low inflation with an increased money supply (suggesting that our GDP is growing because we are printing money with low inflation).
With all this said is is good to see that America is bouncing back. With a declining unemployment rate and our dollar strengthening, we are heading in the right direction.
It is interesting point to say that the United States overlooked the 2008 Financial Crisis because of our idealized view of capitalism. I agree with the Krugman in the though that the 2008 crisis was a great lesson for the United States. American's must be aware of the economy and that it is always not going to be in a perfect state. For this reason they must taken protective actions to defend their assets and livelihoods.
ReplyDeleteThe crisis of 2008 hurt families and citizens across the nation. People need to be careful about how they spend, save, and what money they invest. The economy could fall whenever and this should be a wake up call for everyone.
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