Sunday, August 14, 2011

Muddling As The Economy Sinks

The Japan Times


The margin of error for the world's economic managers is shrinking. The United States is on the cusp of a double-dip recession, the Eurozone flirts with collapse, Japan continues to struggle with deflation — a task made harder by the triple catastrophe of March 2011 — and global stock markets are on a roller-coaster ride. Unemployment is mounting, debt is growing, and politicians seem unable to get the situation under control. Those leaders recognize the scope of the problem, but they do not seem able to act. Future historians are unlikely to judge them well..….
There is no single prescription: Stimulating demand makes sense in Japan and the U.S., but much of the problem is a shortage of demand. In Europe the problem is governments living beyond their means. A real recovery demands tough decisions — we have yet to see any of those……..

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