Krugman Wants Another "Stimulus"

The first wasted $850 billion wasn't enough to jump start the economy, so let's take another huge pile of money we don't have and try and put Humpty Dumpty back together again.

In case you missed Mr Krugman's interview in Asia from the other day, he said the following -

"A second stimulus is becoming clearly urgent. They need a very, very strong stimulus."

http://uk.reuters.com/article/governmentFilingsNews/idUKPEK5258120090511?sp=true

I guess I am no longer one of Paul's "Liberals". What we need is to purge the system of excess over-capacity and massive debt and start incentivizing Savings and domestic Capital Investments.

A Liberal thinks that Public Capital is infinite, where as a conservative thinks that Public Natural Resources are infinite. I am sure that the truth lies somewhere in the middle, but we are now on a path to make all Capital creation a public exercise, while locking up the Natural Resources into a "lock box". Both seems ridiculous because they are - and so is Krugman.

On a side note, a few months ago I did a chart that showed how there was a Tax Cut long after the Stock Market had bottomed. It was clear that the economic news must have been horrible, even though the market had started to price in recovery. A second "Stimulus" would be the Liberal version of a Tax Cut and would seem to be late to the economic recovery - or in English, the "Bottom" is probably in for stock prices, but the "news" may still be nasty for a few more months.

Add another "Stimulus" to a second round of Quantitative Easing funding, and you see why Gold and Commodity stocks have gone vertical. I just want to buy pullbacks in these areas...