The implicit faith in the wisdom of the stand-alone market economy, which is largely responsible for the removal of the established regulations in the US, tended to assume away the activities of prodigals and projectors in a way that would have shocked the pioneering exponent of the rationale of the market economy.
The economic difficulties of today do not, I would argue, call for some “new capitalism”, but they do demand an open-minded understanding of older ideas about the reach and limits of the market economy.
We have learned that no one becomes mature without living through the pains and confusions of maturing experiences.
—Professor Elder, UC Berkeley
There are neighborhoods around the country as bad as anything in Cleveland. Cleveland is a bellwether. It’s where other cities are heading because of the economic downturn.
—Dan Immergluck, a visiting scholar at the Federal Reserve Bank of Atlanta and an associate professor in the city and regional planning program at Georgia Tech
This crisis was triggered by foreclosures, and a lot of those were in a very small number of areas
—William Lucy, University of Virginia
The industry publication, Inside Mortgage Finance, shows that subprime lending grew from approximately $35 billion in 1994 to $665 billion in 2005. We now have a flood of credit, much of which is structured to the detriment of the borrower and to the benefit of the credit arrangers. This flood of credit is distorting housing markets and causing negative spillovers from directly impacted borrowers onto neighbors and communities.
…
Property appreciation that is built upon financing gimmicks and short-term teaser rates is not real, sustainable appreciation and, in the long run, discourages the smooth functioning of housing markets and neighborhood economies.
—Dan Immergluck testifying before congress, 21 March 2007
Robert Shiller inaugurates the Capitalism blog at the FT
Tonight I sit alone
unattended by friends or the sounds
of muted city streets
in August.
Tomorrow our boys will be born,
if science and God’s good grace
and my wife’s fortitude
hold out
for a little, so that they
will grow, have children or not
have children, also find love
or not,
live long or briefly and fuse
someway into generations,
a future they already bequeath
to us.
We need to react in real time to a growing crisis that is hurting people in developing countries. This global crisis needs a global solution and preventing an economic catastrophe in developing countries is important for global efforts to overcome this crisis. We need investments in safety nets, infrastructure, and small and medium size companies to create jobs and to avoid social and political unrest.
Debt issuance by high-income countries is set to increase dramatically, crowding out many developing country borrowers, both private and public.
—Robert Zoellick, World Bank President, announcing finance gaps and a recessionary forecast for the global economy
This crisis is the first truly universal one in the history of humanity. No country escapes from it. It has not yet bottomed out.
—Michel Camdessus, former IMF Managing Director, at an ADB forum in Manila, 9 March 2009
Asia is mainly suffering a cyclical slowdown because of problems in the developed economies, it is not suffering a structural economic breakdown. There is no reason to think that the growth engines that have been unleashed in many parts of Asia are likely to weaken.
—Manu Bhaskaran, head of economic research at Centennial Group
The loss of financial wealth is enormous, and the consequences for the economies of the world will unfortunately commensurate. There are serious economic and political stumbling blocks that may well cause the recovery to be costly and slow to consolidate…There is no room for denial or populist policies. Otherwise the crisis will become even deeper and harder to reverse.
—Claudio Loser, president of strategic advisory firm Centennial Group
Clearly, fiscal resources do have to be injected in rich countries that are at the epicenter of the crisis, but channeling infrastructure investment to the developing world where it can release bottlenecks to growth and quickly restore demand can have an even bigger bang for the buck and should be a key element to recovery.
—Justin Yifu Lin, World Bank Chief Economist and Senior Vice President, London, 9 March 2009, on reconciling investment in rich countries in the face of the immediate effect on poorer nations.
There is a part of everything which is unexplored, because we are accustomed to using our eyes only in association with the memory of what people before us have thought of the thing we are looking at. Even the smallest thing has something in it which is unknown.
—Maupassant, “The Novel,” preface to Pierre and Jean (1888)
“They love him because he makes them feel that the movement has a future.”
Although the administration likes to say it ”inherited” the recession and trillion-dollar deficits, the economic wreckage has worsened on Obama’s still-young watch.
Every day, the economy is becoming more and more an Obama economy.
To quote GW: there’s ” no magic wand”
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