tag:blogger.com,1999:blog-8595404115121834255.post742868802609367301..comments2024-03-28T03:24:05.678-04:00Comments on NAKED KEYNESIANISM: An Alternative Vision for the Eurozone Crisis Matias Vernengohttp://www.blogger.com/profile/09521604894748538215noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-8595404115121834255.post-49258336732207071652012-11-15T15:00:46.942-05:002012-11-15T15:00:46.942-05:00That wouldn't work but larger fiscal transfers...That wouldn't work but larger fiscal transfers are normal in federal unions.Matias Vernengohttps://www.blogger.com/profile/09521604894748538215noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-33189079601485316372012-11-15T13:50:47.589-05:002012-11-15T13:50:47.589-05:00I think I am starting to believe in conspiracies, ...I think I am starting to believe in conspiracies, honestly. It might sound silly, but the amount of bubble crises after the "stagflation" that ended most of keynesian policies over the world (1 crises in 30 years of biggest growth is hardly a bad number) is astonishing, and they all have pretty much the same reasons.<br /><br />I was watching a video the other day of our ex-president Fernando Henrique in a reunion with Clinton and others, almost begging on his knees for some regulation on leveraging in finance markets after the Asian crises that affected Brazil and other innocent countries. So, what I mean is, even neoliberals had no doubt that it was a deregulation problem, now that the crises is affecting central countries, neoclassicals are trying to save themselves blaming it on "THE GOVERNMENT!111111" or "fiscal irresponsibility" Oh so now that it is a more "relevant" crises you try to make up lies?<br /><br />I really really doubt this was unpredictable.. there is a will in this crises, I am almost sure. Something has to be done, and we all know, in the end, somehow, the left wins. So that makes me calmer (french revolution, slavery, etc)Anonymoushttps://www.blogger.com/profile/02185345672659237043noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-11734620111802578732012-11-15T13:43:59.954-05:002012-11-15T13:43:59.954-05:00I think there should be some law that "forces...I think there should be some law that "forces" countries like Germany to have importation program on greek and peripheric products, that of course if the view of an ignorant student in my first year of economics, what do you think?Anonymoushttps://www.blogger.com/profile/02185345672659237043noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-450939203252454392012-11-15T09:07:06.938-05:002012-11-15T09:07:06.938-05:00Not sure that it is that polemic. Yes, once you ha...Not sure that it is that polemic. Yes, once you have a Free Trade Area, there will be concentration of industry in certain places (the rust belt effect). I guess what they meant by higher wages in Germany is less about competitiveness, and more about expansion of demand in Germany. More demand in Germany may lead to higher levels of employment in the whole eurozone. And as Pablo Bortz noted in a twit also more fiscal transfers would be necessary. Like in the US.Matias Vernengohttps://www.blogger.com/profile/09521604894748538215noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-45597200321818836912012-11-15T08:46:22.409-05:002012-11-15T08:46:22.409-05:00I'll say something polemic. Theoretically, if ...I'll say something polemic. Theoretically, if somebody claims that rising wages in Germany (and I totally favor that, I'm pro increased wages in Germany) will solve the TRADE imbalances with the European periphery (that's the usual argument in its favor, for its impact on unit labor cost), then the same applies for a reduction in Greek wages (or other countries in the periphery). This is false, and the last data has shown that. <br />Even if the effect is to lower German surplus, the benefited countries will hardly be those of the periphery. Perhaps a few more Germans will go to Greece or Spain, but it won't be relevant. The benefited countries will be China, Russia, and other with really low wages, not Greece or Spain. <br />The problem is structural competitiveness, not price competitiveness. Greece simply doesn't produce almost anything. The Spanish is a low competitive economy. Only Italy can compete (and not with this interest rates) on a par, and still the problem there is structural.<br />I'm in favor of Greece leaving the Euro. I think they should make a sharp and big devaluation (because like I said, price elasticities are low, and even a moderate devaluation will not help). But if the objective is to keep everybody inside the Euro, a Marshall Plan is a must. And the same goes for something like Keynes's proposal for recycling current account surplus. I support wage increases in Germany, but that will not solve the imbalances with the periphery.<br />Saludos. PGBhttps://www.blogger.com/profile/00176679709411717528noreply@blogger.com