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Except that FDR also caused the 1938 recession by withdrawing economic stimulus too early. And too early here means in the first year of his second term. Obama is likely to have passed a too small stimulus in the first year of his first term and to withdraw it before the end of his first term.

En un viejo país ineficiente, algo así como España entre dos guerras civiles, poseer una casa y poca hacienda y memoria ninguna. -- Gil de Biedma
by Migeru (migeru at eurotrib dot com) on Sun Jan 24th, 2010 at 06:29:40 PM EST
[ Parent ]
But again with the predictions.  That may turn out to be the case, I don't know -- I certainly feel that the current stimulus is too small, but do not yet know - and neither does anyone else here -- whether Obama will expand and/or withdraw it, on what time frame either might happen, and what effect all of these variables will have on the economy overall.  Events, as they say, are unfolding.

My original point still stands -- what we're currently witnessing is NOT a collapse equivalent to the depression; and the political environment Obama stepped into is different from the one FDR stepped into.  Everything else remains to be seen as they also say.  

Maybe we can eventually make language a complete impediment to understanding. -Hobbes

by Izzy (izzy at eurotrib dot com) on Sun Jan 24th, 2010 at 07:04:47 PM EST
[ Parent ]
To be fair, that wasn't (mostly) FDR's policy. It was mostly a pushback by right-wing congresscritters who went all chicken little on the deficit.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Jan 24th, 2010 at 07:32:10 PM EST
[ Parent ]
You mean like everyone and their mother is now going chicken-little on the deficit and on inflation fears and on loss of investor confidence on state debt?

On the latter, I think it is wrong to interpret the recent rise in government bond yields as a sign that the sustainability of public finances is at risk.

En un viejo país ineficiente, algo así como España entre dos guerras civiles, poseer una casa y poca hacienda y memoria ninguna. -- Gil de Biedma

by Migeru (migeru at eurotrib dot com) on Mon Jan 25th, 2010 at 05:03:03 AM EST
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