Monday, January 30, 2012

Eurozone Problems

by Paul Krugman

New York Times
January 30, 2012

I’m giving a talk in Paris tomorrow. Here are some slides; they won’t come as a shock to regular readers, but it may be useful to see them all in one place.

First, I make the case that the overall economic crisis is driven by private debt, not public debt:

Then I point to the huge swing of the private sector into financial surplus, which necessitated large public deficits to avoid a much deeper slump:


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