"So is there no route back to full employment absent the kind of massive stimulus that only seems to happen via war? OK, even Keynes wasn’t that pessimistic: he argued that investment would eventually recover once “use, decay, and obsolescence” created a sufficient scarcity of capital. Once we take the problem of debt into account, I think you’d want to add deleveraging and default — which reduce the debt overhang — to his list. So even on a very Old Keynesian view, depressions aren’t forever." krugman.blogs.nytimes/2013/09/08/auto-corect-nt-wokring-wonkish/
Posted on: Sun, 08 Sep 2013 16:21:44 +0000
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