STIGLITZ: The Economy Was Sick Before The Crisis

As the economic slump that began in 2007 persists, the question on everyone’s minds is obvious:

Why? Unless we have a better understanding of the causes of the crisis, we can’t implement an effective recovery strategy. And, so far, we have neither.

We were told that this was a financial crisis, so governments on both sides of the Atlantic focused on the banks.

Stimulus programs were sold as being a temporary palliative, needed to bridge the gap until the financial sector recovered and private lending resumed.

But, while bank profitability and bonuses have returned, lending has not recovered, despite record-low long- and short-term interest rates.

Keep reading ‘To Cure The Economy’ at Project Syndicate >

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