I've Got Krug Disease

Or, perhaps I should say, Paul Krugman, the writer/economist, and I agree on something (which is not as common as one might think.)

First read Krugman's story last Tuesday. Now here's Krugman on Wednesday:

"...the Fed ended up cutting the Fed funds rate — the overnight interbank interest rate — by a lot: more than 6 1/2 percentage points in response to the 1990-91 recession, 5 1/2 percentage points in response to the 2001 recession. That second time got scary, because there was only 1 percentage point left...This time we started at 5.5%. If the shock is worse than last time — which certainly seems possible — there is real reason to worry."

He's basically saying, in both of his blog posts, that the Federal Reserve is potentially getting dangerously close to too-low interest rates, or in other words the "zero lower bound" of the Fed Funds Rate is approaching too quickly.

I just hate to point out how awesome I am, but I just knew I'd be revisiting [the second half of] this post someday, in which I was making this exact same point about a coming zero-interest rate problem three months before the Fed's latest panic session:

"...when housing prices are facing a precipitous fall (now), a recession is possible, and inflation might not be too much of a worry considering productivity and/or population growth as well as reduced consumer demand, it seems that the long term trend in the funds rate toward 0.00% might just have to come to fruition in response to economic necessity rather than an easy, sooner-or-later it'll get there kinda thing. Basically, our economy might soon be facing a situation that will require an extremely fast drop in rates (whether or not it has anything to do with a long term trend.)

The reason why this is a problem, though, is that...If we're getting a recession and heavy deflation AND the funds rate is already 0.00%, our Federal Reserve buddy Ben Bernanke might actually have to rent a helicopter."

There's more relevant gems in the post. See, now you all know why I do these completely boring posts that nobody (except maybe Chris Jeffords) likes: to look smart later on. Then again, I'm sure nobody enjoys this post either. I sure had a fun time feeling righteous and writing it though!

Anyways...

Now I need to figure out a way to convert those mad econoskills into some sort of paying situation... like, maybe, one of those things I used to do... What was it called...? Ummmm...

Oh, that's right, a job.





Also, for the record, I promise I'll try not to point out how incredibly awesome my insight is in future blog posts. Oh, wait - except for this. I've got to do this:

From September 9, 2005 (Anybody know what night that was? Fred?) all credit goes to Stephen Guzzo, my former roommate, for this catchy, hilarious, 1337 and prophetic phrase:

Someone Set Up Us The Obama

For those of you who don't know the reference, watch this jewel. This line was/is the greatest tag line for any presidential run I've ever heard, so I'm putting it out there on the internet because nobody else has. Go ahead, search for it - there's an incorrect variation, but it's far more recent and isn't very official.

When Barack Obama's crew goes searching the internet for a motto that truly pulls at the heartstrings of his target demographic (the Nintendo generation), The Guz and I shall receive all the credit and all the mad, mad props. And money - send money, too, please. Thanks.

In a few months, if/when Barack Obama gets his party's nomination and he's using this phrase, you all will be so proud knowing that you saw its birth on the 4ECon. It's gonna happen, dammit. You'll see.


Ooop... There's my Krug Disease acting up again... I apologize, folks...