Look Out Krugman, Belief In Keynes Is Belief In Self-Delusion: Peter Schiff Tells The Truth About The Recession And Government Spending (Morning Joe Video)
I want to be clear that the line 'belief in Keynes is belief in self-delusion' is my crack and not Schiff's.
I don't normally post Peter Schiff videos. No real reason. He's solid. He saw it coming, but seriously, so did thousands.
Only the people in charge of watching it, didn't see it coming. Greenspan, Bernanke, Bush, Paulson, Geithner, Bob Rubin, Chuck Prince, Jimmy Cayne, Richard Fuld, Joseph Cassano, AIG, Sheila Bair, Barney Frank, Chris Dodd, the SEC, Chris Cox, Ben Stein is an idiot, CNBC, FOX, CNN, The New York Times, Larry Summers, The Wall Street Journal and all the Bank CEOs. Just to name a few.
But Peter was on MSNBC's Morning Joe today with Joe Scarborough and the annoyingly submissive Mika Brezinzki (for the record, I don't watch this show). And he rocked. Outstanding. Listen, I love Paul Krugman for fighting for taxpayers against Geithner's bank rescue plan. But I think he's dead wrong about stimulus spending and the power of government spending in general.
The entire 8 minute clip is excellent, but if you just want the frontal assault on Krugman and Keynesians, start the clip at the 2:20 mark. Here's a taste.
"Keynes. It's nonsense. He's like a witch doctor in medicine. You can't follow Keynes. Keynes didn't understand Economics."
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Reader Comments (16)
That might prove a short-term respite. No sooner might the Treasury Department mop up those assets than $1 trillion or more in new ones spring up to take their place.
That is due to the potential return of assets held in so- called off-balance-sheet vehicles that banks may soon have to put back onto their books. The end result may be that banks are in no better shape to increase lending even after the government bailout.
So investors betting for quick solutions to the financial crisis could be disappointed. The tangled web that banks wove over the years will take a long time to undo.
At the end of 2008, for example, off-balance-sheet assets at just the four biggest U.S. banks -- Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. -- were about $5.2 trillion, according to their 2008 annual filings.
http://www.bloomberg.com/apps/news?pid=20601039&sid=akv_p6LBNIdw&refer=home
Evidence from dealbreaker that most hedge and PE funds want nothing to do with the Geithner plan. Read the comments.
http://dealbreaker.com/2009/03/why-does-john-paulson-hate-the.php#comments
Volcker, 81, who heads the president’s Economic Recovery Advisory Board, is being asked to take a look at the laws in an effort to rebalance the tax system.
Orszag said the review, given a deadline of Dec. 4, is being ordered to make recommendations on steps to simplify the code, built over the last 96 years, in ways that would reduce tax evasion and what he called “corporate welfare.”
“There are hundreds of billions of dollars in uncollected taxes each year,” Orszag said in a conference call. The Volcker board “will be examining ways of being even more aggressive on reducing the tax gap.”
http://www.bloomberg.com/apps/news?pid=20601087&sid=aNoTPC_qo8Dw&refer=home
Law student gets Bernard Madoff's brother's assets frozen
http://www.newsday.com/iphone/ny-bzpete0326,0,4408938.story
You left Bloomberg off your list among other major players too numerous to mention. :P
Among being chairman of the Economic Recovery Advisory Board, Volcker is a member of the CFR, was a founding member of the Trilateral Commission, is a member of the Trust Committee of Rockefeller Group, Inc., and is Chairman of the Board of Trustees of the Group of Thirty. At a minimum, he is engaged in serious conflicts of interest and has little independent credibility. Never trust an insider to "fix" the tax code. Volcker is certain to "fix" the code for his corporate sponsors and the corporate sponsors of those he reports to, namely President Obama.
GS was Obama's second largest contributor to his 2008 Presidential election campaign with $1,035,095 in bribes pre-paid in full.
http://www.opensecrets.org/races/contrib.php?cycle=2008&id=PRES
Interestingly JP Morgan Chase & Co, Citigroup, UBS, and Morgan Stanley were top contributors as well.
GS was in the top 20 largest contributor list to Obama's 2004 Senatorial election campaign with a measly $58,000 in bribes pre-paid in full. Interestingly Soros Fund Management and JP Morgan Chase & Co were top contributors as well.
http://www.opensecrets.org/races/contrib.php?cycle=2004&id=ILS2
$5.2 trillion in off-balance-sheet assets at BAC, C, JPM, and WFC you say? Can you say CMBS and Option ARMs? I think even those filings may be conservative. Ouch!
Gonna be tough on many regional and community banks that went nuts with commercial shite.
Private sector spending happens MUCH FASTER, there is less skim for graft and it tends to multiply more effectively because it creates permanent employment.
We love Dr. Galbraith for his Fed stance and are happy to debate him on the more contentious issues.
Thanks for your comment.
"This interview of Peter Schiff with MSNBC is an embarrassment of misinformation and partisanship. How can a BUSINESS channel broadcast ridiculous pap?! In the first place the interviewer is hardly impartial, he behaves like a hysterical schoolgirl who is totally in love with Peter Schiff. This man is supposed to be completely impartial. He is supposed to seek the truth by challenging false assumptions and rigorous intellectual analysis."
As opposed to any other interview? I agree with you, but this has always been the case, and not just with MSNBC. At least an alternative bias is now being vocalized rather than from Keynes fanboys only, like yourself.
"He's glib and seems to understand what's going on, but in fact knows nothing."
Quit spreading FUD and speaking in hyperbole. What was Schiff wrong about and why? Can you prove that Schiff knows nothing or otherwise provide a defensible argument? I doubt it.
"Before beliving Schiff's nonsense, it should be kept in mind that Keynesian economics is widely credited as one of the greatest economists (including Milton Friedman) who ever lived."
You mean Keynes was widely credited as one of the greatest economists who ever lived. Those days are over, or soon will be.
"Kensian economics is credited for bringing the world out of the great depression."
Or prolonging it. Depends who you listen to.
"Paul Krugman is a Nobel Prize winner in economics. Who's judgment are you going to trust?"
Krugman's Nobel Prize gives him more credibility than others without such prominent awards. However, this could possibly be viewed as even more dangerous than you suggest of Schiff, because in Krugman's case, the public believes the majority of what he says because of his name only rather than the merits of his arguments independent of his award. The same level of scrutiny is no longer applied and the healthy level of skepticism that should exist for any argument has gone completely out the window. Time is ultimately the judge of all, and Nobel Prize or not, his wise judgments or lack thereof will be what he is known for long after he passes on.
"The fiscal problem we have is a result of irresponsible tax cuts advocated for by prehistoric schools of economics(the Austrian school is a prime example) ..."
Nice disingenuous swipe. Prehistoric schools is a new one to me. Are you thinking Mesozoic specifically? Maybe that's why the positions are so refined. They have had an extraordinary period of time to think the arguments through and withstand the test of time, rather than the sixty or so years the Keynesian school has had to prove itself an utter disaster. Milton Friedman agrees.
The most laughable comment you made was giving Keynes credit for ending the Great Depression...bwahhhaaaa...nice try.