When Japan lost a decade in the 1990’s due to economic malaise, they were the world’s biggest creditor. Now that our second bubble has burst, we face the same crisis except we are the world’s biggest debtor. As this guy says, “we might be lucky to have just a lost decade.”
It amazes me that there is so much confidence among economists and politician that massive and unprecedented extra spending and budget deficits (estimated at 750 billion for next year, but I’d be higher) will solve our problems. Isn’t credit what got us into this mess in the first place?
If I were President, I would make every Congressman and member of the Federal Reserve read “Fiat Money Inflation in France.” Obviously Hank Paulson knows nothing about history. Ben Bernanke knows a lot about history, but one wonders if he learned the wrong lessons from it.