tag:blogger.com,1999:blog-2546602206734889307.post3881224001646311836..comments2024-03-28T04:29:22.717+00:00Comments on mainly macro: On Major Macroeconomic Policy MistakesMainly Macrohttp://www.blogger.com/profile/09984575852247982901noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-2546602206734889307.post-45597378293153379762012-05-12T11:35:59.480+00:002012-05-12T11:35:59.480+00:00You are exaggerating the case. The budget deficts ...You are exaggerating the case. The budget deficts from 2003-2008 were between 2-3.5%. These deficits did not cause the crisis, they may have exacerbated it, but didn't create it.<br />Osborne's policy has created a recession from a newly born recovery.Paul Hnoreply@blogger.comtag:blogger.com,1999:blog-2546602206734889307.post-63994040072915326132012-05-12T10:29:41.560+00:002012-05-12T10:29:41.560+00:00I'd like to take up the point that the Labour ...I'd like to take up the point that the Labour government could have done more to regulate the financial sector in the early years after the millennium. I think you are entirely right. However this doesn't take into account the wider social and media environment. Only now are we beginning to see how successive governments have had to be in the pockets of the press to survive. This reveals how much of a hostage to fortune governments are to conventional wisdom and in this particular case the markets.<br /><br />Ever since the big bang conventional wisdom has said that deregulation is the only way. This is basically the markets, through the media, holding a gun to the heads of whoever is in power. The markets thought the party would go on for ever and would shoot any who tried to regulate them otherwise.Jack Barrowhttps://www.blogger.com/profile/05426355594223589081noreply@blogger.comtag:blogger.com,1999:blog-2546602206734889307.post-27280882378201688542012-05-04T19:22:18.895+00:002012-05-04T19:22:18.895+00:00I also believe the issue was regulation more then ...I also believe the issue was regulation more then monetary policy that was the most (although not sole) factor in this whole mess. The big banks were extremely reckless, and many of them simply became giant hedge funds. Why this was not understood or stopped by regulators I still don't understand, but the "light touch" regulation was the biggest factor.farmland investment in Australiahttp://www.greenworldbvi.com/alternative-investments-options/agricultural-farmland/australian/noreply@blogger.comtag:blogger.com,1999:blog-2546602206734889307.post-38995634100066889452012-05-04T15:49:05.279+00:002012-05-04T15:49:05.279+00:00"The increase in government spending by Labou..."The increase in government spending by Labour around 2005 was underfunded, but I would not call this a major policy error because I do not think it led to a large decline in social welfare."<br /><br />The loss in social welfare is never felt at the time of the increase in government spending (the reverse is true) but after the party is over (i.e. today). Deficit spending in a boom is just as bad a policy mistake as (as I am sure you'd agree) attempting to balance the books in a recession.<br /><br />That symmetry argues for me that 2005-7 labour policy was a very large, very predictable policy error. Arguably worse than anything the current government is guilty of. You can argue the Conservatives could do more (run larger deficits for longer) but they are at least the right way round (running a large deficit in a bust).<br /><br />Labour were running a large deficit in a boom. Exactly the wrong thing to do.Chris Brownhttps://www.blogger.com/profile/13779786705356501784noreply@blogger.com