That Plateau Feeling
(Krugman, December 2007)
Image via WikipediaThere was the original bailout before America even had elections. Then there was the jumbo stimulus package. And then the G20 summit where the world leaders took substantive action. Next thing you know good news started trickling out of Wall Street. It is not exactly time to throw a party yet. There is no boom feeling. But I have a feeling the big crisis that has been blowing hot and cold for the past eight months might have plateaued.
The good news is the steep fall part of the bungee jump might be over. The bad news is there is no telling how long the plateau might last. The worse news is we are not in the upswing phase yet. And you still hear the sound of glass being broken.
The US economy, and the global economy are such big monsters, it is hard for any government to steer them in any direction at any speed. It is kind of like trying to give a 180 degree turn to the Titanic.
For the past decade we have talked of global warming, and we have talked of global terror. But we were not exactly talking global finance. Imagine twice as many hurricanes any given year. Imagine 10 dirty bombs in the 10 big cities of the world on the same day. Those would be the climate and terror versions of what we have been going through in finance.
The pain has been very real, and ultimately it is for the political leadership to steer a course. We have to have a healthy, robust debate all along. We have to be creative, inventive. We have to do the sane thing, the right thing. We have to think long term. We are in this together. This is one world, one planet, one globe.
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Global Finance, Global Terrorism, Global Warming