Monday, June 14, 2010

Credit crunch, bailouts and unemployment - according to Steve Keen

Steve Keen, Australian post-Keynesian economist and one of only about 16 (previously estimated at 12) out of 20,000 econ pros to have predicted the "credit crunch" (aka GFC - Global Financial Crisis), looks at economic models and produces his own. The one I find most striking is the last, Fig. 22:

There are several implications I see here:

1. It is better to bail out borrowers than banks
2. The disruption takes c. 15 years to settle
3. Whatever is done or not done, we are left with permanently elevated levels of unemployment

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2 comments:

  1. The Arthurian15 June 2010 at 08:14

    There are several implications I see here:

    1. It is better to bail out borrowers than banks
    1. It is better to bail out borrowers than banks
    1. It is better to bail out borrowers than banks

    That's the list.

    ReplyDelete
  2. Sackerson15 June 2010 at 14:32

    Your emphasis duly noted, Arthurian!

    ReplyDelete

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