Open Thread: Paul Krugman's Take on the Bailout, what's yours?
Paul Krugman posted this video and the following link to a CNBC discussion with the great title: Dr. Doom & the Black Swan: How to predict a financial crisis and the five signs of a bear, with Nouriel Roubini, RGE Monitor and Nassim Taleb,
So what does Nobel prize winner Krugman have to say. (Don't get me wrong I really respect him and check in on his blog at frequent intervals).
Krugman says its impossible to know just what the plan means. You pay your money and you take your choice (I'm saying that not him.) He says:
An old joke from my younger days: What do you get when you cross a Godfather with a deconstructionist? Someone who makes you an offer you can’t understand.
I found myself remembering that joke when trying to make sense of the Geithner financial rescue plan. It’s really not clear what the plan means; there’s an interpretation that makes it not too bad, but it’s not clear if that’s the right interpretation.
The plan deserves praise for what isn’t in it, at least as far as I can tell. There doesn’t seem to be provision for mass purchases of toxic waste at premium prices; there also doesn’t seem to be a massive “ring-fencing” guarantee against private losses on bad assets. In that sense the plan is better than what the last few weeks of leaks led us to expect.
... snip ...
So what is the plan? I really don’t know, at least based on what we’ve seen today. But maybe, maybe, it’s a Trojan horse that smuggles the right policy into place
Don't skip the videos! That's where the real commentary is? !!!