Comments for Wall Street Journal Claims President Obama is Delusional About Economy at http://www.cepr.net , comment 1 to 7 out of 7 comments http://www.cepr.net Mon, 20 May 2013 16:58:05 +0100 FeedCreator 1.7.3 http://www.cepr.net/index.php/blogs/beat-the-press/wall-street-journal-claims-president-obama-is-delusional-about-economy#comment-20833 Perhaps Obama was including the debt limit in the 'Big Deal', and the interest rate spike would be a result of downgrades due to not raising the debt limit, or rating agencies otherwise being spooked by the GOP. (Ignoring whether downgrades actually would have any such effect.) - Jon Hendry Mon, 24 Dec 2012 06:15:00 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/wall-street-journal-claims-president-obama-is-delusional-about-economy#comment-20824 I tend to agree with Matt's comments, above. The President is simply playing poker with Boehner. He understands that he has the better hand and merely has to convince Boehner to fold. - Stuart Levine Sun, 23 Dec 2012 05:55:56 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/wall-street-journal-claims-president-obama-is-delusional-about-economy#comment-20817 When Krugman and Baker say that a recession would cause lower interest rates, they apparently are referring to the rates on Treasuries. But in the past, recessions have invariably caused *increases* in the rates for corporate bonds. This happened in the Depression and it happened in the recession of 2009 (see for example the rates on Baa-rated bonds at FRED). As Krugman explained in 2009, when the economic outlook is uncertain, investors flee bonds which are viewed as more likely to default and buy Treasuries instead. What influences private investment is of course the private rates, not Treasury rates. But while the increasing spread between corporates and Treasuries is generally a bad thing for the economy, it is a result and not a cause of recessionary conditions. If it really comes to the point that the bond market considers there to be a significant risk of default of Treasury bonds this historical pattern could change. This is apparently what the "bond vigilante" alarmists are claiming will happen. Nothing of the sort has ever happened in the US, and it certainly did not happen in 2011 when S&P downrated Treasuries. Greece and other shaky European countries are a different matter - someone who really wants to approach this subject rationally could look at what corporate bond rates have done in Europe through the recession. - skeptonomist Sun, 23 Dec 2012 03:31:22 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/wall-street-journal-claims-president-obama-is-delusional-about-economy#comment-20814 Here's what I think is the most important exchange between the Speaker and the President: " in reference to Boehner's offer to secure $800 billion in revenue by limiting deductions, the speaker reportedly implored the president, "What do I get?" The president's alleged response: "You get nothing. I get that for free."" With 9 days to go, the President will get tons of tax hikes if the House does nothing...Then the game switches to what the House will concede in exchange for things like lowering taxes on those making between $250,000 and $400,000 or lowering taxes on dividends etc.. - Robert Salzberg Sun, 23 Dec 2012 02:35:36 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/wall-street-journal-claims-president-obama-is-delusional-about-economy#comment-20810 If you are interested in new economic policy you should be interested in the Zero Inflation Taxation Policy. We have a flaw in our economic policies. Currently we rely on the Federal Reserve to manage the economic cycles of boom and bust. They cannot do it efficiently with monetary policies. It would be more efficient to use the tax code automatically before the Fed gets involved, to manage economic cycles. For more information on how to correctly use the tax code to help make our economy to be more productive and less speculative go to wp.me/p1gMnS-8i or www.foreclosurecrisissolved.wordpress.com - Leonard C Tekaat Sat, 22 Dec 2012 15:06:42 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/wall-street-journal-claims-president-obama-is-delusional-about-economy#comment-20809 Well, it's not a hostage negoiation; it's budget talks over a made-up dealine that isn't very scarey. What you do in that case -- if you want a stronger economy and no Social Security and Medicare cuts -- is to go on TV, as any president can, preempt as many channels as you can get on -- lots -- and tell everyone it's a made-up dealine and not scarey, that nothing much happens for weeks at least after the deadline, and that the bargaining position for the vast majority of the American people -- excluding those who blew up the economy -- will be vastly stronger after Janurary 1, 2013. Then you describe to them how Republicans have destroyed the economy and tried to take money out of the hands of the vast majority of the American people to give to a few rich people. Repeat every week if needed. - JDM Sat, 22 Dec 2012 14:57:41 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/wall-street-journal-claims-president-obama-is-delusional-about-economy#comment-20808 Look, when you're conducting a hostage negotiation it sometimes helps to use the hostage taker's own mythology - and right now, Boehner and the rest of the GOP are looking awfully twitchy with that gun held to their own forehead. The other possibility, of course, is that the WSJ's source didn't have much detail, leading them to fill in the gaps with their own economically-impossible results. - Matt Sat, 22 Dec 2012 12:33:35 +0100