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Paul Krugman Discuses The Financial Crisis Of 2008

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In The Return of Depression on Economics and the Crisis of 2008, Paul Krugman discuses the financial crisis of Asia and Latin America during the 1990’s. Laterally, Krugman points out the discomforting similarity between the financial crisis of 2008 and The Great Depression. He illustrates that we are face to face with economic discomfort and we must educate ourselves on this past, present and future issue. Krugman explains each financial anomaly in full, and concludes that the nearly irrefutable turning point was the rise of unregulated financial institutions. Ironically, the solution offered is the same one that put us in this hole. The solution is to get credit flowing again. To be more specific, get good credit flowing. The poor status of our economy was due to loans being given out to anyone and everyone who had no …show more content…

This is shown through countless home foreclosures as well as the expunction of small and big businesses. Unfortunately, 2008 isn’t that far in the past. A common phrase says that it is easier to ruin a grade in a class than to improve a grade. The same goes for the economy, it can crash over night but will take years to recover. The way we fix what we have now is by not make mistakes from the past. We must learn if we want to once again flourish. Many US economists from the early 1970’s stated that the economy was quite steady and inflation was under control. This splurge of optimism and overconfidence seemed to actually disrupt progress. Over time, the 1970’s weren’t glistening as was told. I guess that goes to show that premature celebration is never a good option. At this point in time, most families owned a car or two. The confidence behind the wheel came to a screeching halt after the Oil Crisis of 1973. Not to mention its horrific successor, the 1979 energy crisis. Both of

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