More economic pessimism from Paul Krugman, whose skeptical views have a growing following: The United States risks losing an entire decade of growth andJul 31, 202079175 Shares1439541 Views
“„“We’re doing half-measures that help the economy limp along without fully recovering, and we’re having measures that help the banks survive without really thriving,” Krugman said.
“„“We’re doing what the Japanese did in the nineties,” he told a small group of reporters during a visit to Beijing.
“„Krugman said he expected little or no employment growth this year or next in the United States, where the jobless rate in April hit a 25-year high of 8.9 percent.
“„“A second stimulus is becoming clearly urgent. They need a very, very strong stimulus,” said Krugman, a Princeton University professor and a New York Times columnist.
“„He said stress tests carried out on 19 leading U.S. banks had bought time for the administration of Barack Obama, but they had not answered the key question of whether the banks have enough capital to fulfill their key role in the economy.
“„“It’s clear the administration won’t take radical action to strengthen the banks any time soon,” he said. To have done so would have meant temporarily nationalizing Citigroup and, perhaps, Bank of America, he said.