Thursday, August 28, 2014

Barack, we hardly knew ye'd be this bad

Brad DeLong should have listened to us, long ago. He then might have been able to avoid having to admit this;
A year and a half ago, when some of us were expecting a return to whatever the path of potential output was by 2017, our guess was that the Great Recession would wind up costing the North Atlantic in lost production about 80% of one year’s output–call it $13 trillion. Today a five-year return to whatever the new normal might be looks optimistic–and even that scenario carries us to $20 trillion. And a pessimistic scenario of five years that have been like 2012-2014 plus then five years of recovery would get us to a total lost-wealth cost of $35 trillion.
At some point we will have to stop calling this thing “The Great Recession” and start calling it “The Greater Depression”. When?
When DeLong votes for a Republican?  Hell freezes over?

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