PAUL KRUGMAN FEARS AMERICA HAS ENTERED ITS THIRD DEPRESSION
by Ryan Jaroncyk
Tue, Jun 29th 2010
In a New York Times op-ed, Nobel prize winning economist, Paul Krugman, warned that the United States has entered the initial stages of a third Depression. In his view, inadequate fiscal and monetary stimulus, coupled with obsessive worry about short-term, record breaking budget deficits, are increasing the probability of a long, deflationary-driven Depression.
And it's not just Krugman predicting economic depression, either.
Other economists and trends analysts are making similar predictions, but unlike Krugman, they believe looser monetary policy at the Federal Reserve and even higher deficit spending in DC will serve as catalysts for the next leg down.
For example, from the Austrian school of economics, Dr. Ron Paul and Peter Schiff believe America has already entered another long-term depression. But, in contrast to Krugman, they posit that excessive money printing and skyrocketing debt levels will lead to a collapse of the US Dollar. As a result, Paul and Schiff propose an intense bout of short-term pain involving spending cuts, balanced budgets, higher interest rates, and a cessation of government bailouts in order to restore economic stability in the medium and long-term.
Top economic trends analyst, Mike Shedlock, advocates a similar, tough love approach, though unlike Paul and Schiff, he believes a deflationary Depression, not an inflationary Depression, could be on the way.
Leading trends forecaster Gerald Celente has predicted the "Crash of 2010" and an ensuing Depression. And like Shedlock, Paul, and Schiff, Celente believes the Keynesian approach advocated by Krugman and other like-minded policy experts has already proven to be a failure. FULL STORY
GERALD CELENTE WITH ERNEST HANCOCK OF LIBERTY NEWS RADIO 6/22/10