Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
This discussion is drifting sideways, but anyways. The problem with Keynesian deficit spending is deficit spending. The governments just do not "spend money into existence". The feel obliged to borrow money from the "existing" capital and then spend it. Nasim Taleb has already have enough of this reciepe.

There is also a third possibility of your list - the crisis is so deep that no Keynesian spending, however gross, would wake the conventional economy up. A paralyzed economy is only a symptom. The problems won't be solved while stiffing (to some, very comfortable to others) amount of debt is out there.

by das monde on Sat Oct 9th, 2010 at 05:56:48 AM EST
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