A big tip o' the hat to disrael on DailyKos, who caught the latest from economist Thomas Palley, America’s Exhausted Paradigm: Macroeconomic Causes of the Financial Crisis and Great Recession.
Palley's introduction sets the hook quite well:
Most commentary has therefore focused on market failure in the housing and credit markets. But what if the house price bubble developed because the economy needed a bubble to ensure continued growth? In that case the real cause of the crisis would be the economy’s underlying macroeconomic structure. A focus on the housing and credit markets would miss that.
I'm on the road and running late already, so all I'll do here is vigorously urge everyone to read Palley's article in its entirety. Because until people in power, like Larry Summers, starts referring to the problems and solutions Palley identifies, things will never improve for the vast majority of the world's population.
A serious critique
This isn't meant in anyway as a criticism of this post, it's a good catch, but a serious critique of a very old re-hash of an old story by a second-rater, Palley (as are most, if not all, of those individuals at the New America Foundation).
I've read this exact same thing again and again, beginning around 15 years ago. So what?
It's obvious now, as many others far more astute than myself have pointed out, that we are in one giant bubble of bubbles, namely the SECURITIZATION BUBBLE.
More bubbles bursting are to come - maybe over the next twenty years, certainly over the next ten years. With the excellent post of that NY Times story of the BLS study: effectively there has been no new job creation in the private sector over the preceding ten years.
This is EXACTLY what took place during the Great Depression. Not sort of like, not similarly, but EXACTLY!
Also, we are treated to planted stories that the "recession is over" due to excellent quarterly reports from the banks (or rather banksters). This too is EXACTLY what happened during the Great Depression.
Between 1928 to 1933 Wall Street brokerage businesses reported record earnings. Today, the banks are the brokerage businesses and speculators (thanks to that Gramm-Leach-Bliley Financial Services Modernization Act of 1999, and the Commodity Futures Modernization Act of 2000).
The only question is, how much longer can the plutocrats continue to convince the Ameritards that the securitization bubble won't finally burst - which will profit a very select few.
(And with regard to those planted stories, just review the history of Representative LaGuardia's investigation of PR hack, Newton Plummer and his payments to a variety of reporters during the 1920s and the Great Depression; as well as Carl Bernstein's excellent column on "The Four Hundred" back in 1977 or '78 in the Rolling Stone.)
And regarding that New America Foundation....
New America Foundation? Oh yeah, that's where you can find one Lisa Margonelli, the Exxon apologist who has written some really choice articles claiming that (contrary to leaked memos from that outfit) there were no oil refineries purposely shut down, etc., etc., ad nauseum.
these are lectures
from invited speakers. That does not mean those speakers are endorsing any particular policy initiatives from NAF directly.
Also, when you say this securitization bubble matches exactly the Great Depression, some graphs and statistics would make an interesting read. I need graphs and stats to see the argument more.
Apologia
Sorry, you are right, I shouldn't be lumping Palley with the NAF. I'm not saying the securitization bubble exactly matches the Great Depression, I am repreating the NY Times article - and what experts have written about, namely the part of no new jobs being added to the economy for the longest period of time since the Great Depression - that's the match.
As far as that securitization history:
Please check out Prof. Jackson's item here, as well as Dimitris N. Chorafas's book.
DTCC data and Milliken Institute have excellent data on the trillions of dollars of securitization being created and moved about.
what you can do
is write up an overview blog post on this with quotes, some of the tables, data points pulled out of your references.
that's one of the things EP can do, is highlight, overview books, large Academic papers, massive amounts of data and information...
You can look at midtowng or my posts because I do this a lot, esp. with Congressional hearings which can have, each 100 pages of written testimony, documents and 4 hours of video of the hearing, Q&A. No one can watch all of these things so when something critical comes out in one, I try to highlight that so people do not have to sit through 4 hours of video, 3x a day.
Then, techniques to edit videos to pull out quotes from PDFs to format a post are in the user guide, admin forum and last but not least, people can email me for help.
Hey Tony, read EP more!
EP FNV with Palley lecture (overviewing this paper). This is the video of his lecture overviewing this paper, link goes right to it.
Then, midtowng also quoted Palley and pointed to this paper.
Seriously folks, we are often first to press on these little awareness blurbs which is the point of EP ...to put the focus on all things econ...but if you do not read the posts...
Come on, the guy at DK may very well have read EP and decided to put up a post on it. Who knows, but the real credit....goes to Palley and I'm sorry it also goes to New America Foundation.
They are the ones enabling web 2.0, social networking, media technology for these economics lectures and they are the ones who really introduced us to Palley's work here.
I have pulled in Ralph Gomory, Pat Choate, all were invited to speak at New America Foundation and all of those lectures are embedded here.