Home > Miscellaneous Musings, Predictions > Where is Paul Krugman on Japan now?

Where is Paul Krugman on Japan now?

In May 2013 Paul Krugman predicted Japan would power out of recession due to Keynesian pump-priming and monetary stimulus:

To almost everyone’s surprise, Japan — Japan! — has emerged as the advanced country most willing to break with austerian orthodoxy and try a combination of aggressive monetary and fiscal stimulus. The verdict on Abenomics is, of course, still out, although early indications are good.

Well, Paul, a few months later the verdict is already in.  Disaster:

The problem with the approach taken by the Japanese government is  that money is being injected into the financial system and the stock market, but the money velocity is low because it is not trading hands in the real economy – demand and activity remain  stagnate.

Wages in Japan have been on the decline since 1998, and moves to tax big business at a higher rate than labor are unforeseeable, so there are bleak chances for meaningful wage increases and a rebound in consumption.

Where is this idiot now on Japan?  He’s nowhere.  Running away from the issue.  Talking about other stuff.

Irresponsible pyromaniacs are never around when the fires take hold.  Because they started them and know the potential for destruction.  Because that’s what they intended all along.

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