Comments (15)

• Brian Macker

  One thing. We were living beyond our means in the Clinton administration also. Pretty much the entire Greenspan term. We just didn't know it because Greenspan was holding interest rates below market.

  Published: July 20, 2009 6:47 AM

• Jeff

  Here's something. I did a very quick regression of the change in the unemployment rate against the change in the elements of GDP. I realize this is a very crude one-shot, but it yields an interesting result. Only changes in investment yielded changes in the unemployment rate. Consumption is irrelevant. Mostly because peoples' consumption varies so little. Oh, and G and NX don't seem to be relevant either.

  Published: July 20, 2009 9:59 AM

• A. Viirlaid

  Great article. Had to laugh.

  "Paradox of Thrift"?

  We should likewise try to explain another unexplainable.

  How do otherwise such intelligent people (Obama, Krugman, Geithner, Bernanke) all become so dumb when they go to work on solving the 'problem' of an economy that refuses to submit to their will?

  Maybe that syndrome can be called "The Paradox of Keynesian Stupefaction".

  To their overwhelming amazement, the economy stumbles, reverses course, refuses to be 'stimulated', and generally lays down in a fit of lethargy.

  The recommendation of our learned economic leaders?

  More 'stimulation'!!!

  Published: July 20, 2009 12:38 PM

• Brian Gladish

  Does anyone have e-mail addresses of CNBC reporters? Michelle Caruso-Cabrera seems to be very much oriented to free markets (big Milton Friedman fan) and might be the most easily turned to Austrian views. If anyone knows her e-mail address, send her a link to this article!

  Published: July 20, 2009 12:50 PM

• 2nd Amendment

  Thrift is a "paradox" only in highly taxed and regulated socialist countries like the USA, Canada, France etc.

  Under free market capitalism, thrift is no paradox and garantees future prosperity and economic growth.

  Published: July 20, 2009 1:04 PM

• EnEM

  CNBC does not operate on logic. The news presenters, er.. talking heads, are more concerned with making sure they have perfect hair and teeth before going on the air. And here we are, the mindful ones, hoping they would analyze the Keneysian equation AND disgagree with the results!

  Watching that channel is a complete waste of time.

  Published: July 20, 2009 1:25 PM

• EnEm

  Sorry.....I meant *Keynesian* equation

  Published: July 20, 2009 1:28 PM

• Tim Kern

  Mr. Murphy, please don't get sloppy and go down the "Ann Coulter Chute of Ratings and Rantings!"

  Statements like "The federal government kills people to get its way all the time," beg for citation. Most of us remember Waco and (former CIA Director) William Colby; these would probably suffice. If not, you could add some citations of killings that weren't Janet Reno's work.

  When you say, "It's understandable that the politicians would get up there and propose that we lend them a few trillion dollars to hand out to their friends," you're soft-soaping. They "proposed" nothing, and the very concept of "loan" is bogus -- we're not "loaning" anything to "them" -- They aren't responsible for paying it back!

  Published: July 20, 2009 1:29 PM

• matskralc

  Statements like "The federal government kills people to get its way all the time," beg for citation. Most of us remember Waco and (former CIA Director) William Colby; these would probably suffice. If not, you could add some citations of killings that weren't Janet Reno's work.

  About our current Middle Eastern adventure?

  Published: July 20, 2009 1:36 PM

• JB1122

  Paradox of Thrift...

  The only true paradox is the idea of a paradox. We all live in a continuous world - where the seeming existence of a paradox outside of itself is only the result of a misinterpretation of the system under investigation.

  Mathematically, wouldn't it be like denying the existence of a gradient?

  Great article by the way.

  Published: July 20, 2009 3:36 PM

• JB1122

  Paradox of Thrift...

  The only true paradox is the idea of a paradox. We all live in a continuous world - where the seeming existence of a paradox outside of itself is only the result of a misinterpretation of the system under investigation.

  Mathematically, wouldn't it be like denying the existence of a gradient?

  Great article by the way.

  Published: July 20, 2009 3:38 PM

• JB1122

  Paradox of Thrift...

  The only true paradox is the idea of a paradox. We all live in a continuous world - where the seeming existence of a paradox outside of itself is only the result of a misinterpretation of the system under investigation.

  Mathematically, wouldn't it be like denying the existence of a gradient?

  Great article by the way.

  Published: July 20, 2009 3:45 PM

• KP

  "How do otherwise such intelligent people (Obama, Krugman, Geithner, Bernanke) all become so dumb when they go to work on solving the 'problem' of an economy that refuses to submit to their will?

  Maybe that syndrome can be called "The Paradox of Keynesian Stupefaction"."
  -------------------------
  Fayek called it the fatal conceit. I like yours better.
  

  Published: July 20, 2009 4:45 PM

• Nelson

  I believe this topic came up last year. I seem to remember a definition discrepancy between how the Austrian school defines savings and the definition used in "the savings rate." Am I remembering wrong?

  Published: July 20, 2009 5:42 PM

• JB1122

  Many apoligies for the multiple posts.

  Published: July 20, 2009 6:02 PM