Here’s Paul Krugman discussing Britain:
A couple of weeks ago I tried to get at what’s wrong with the latest tactic of the austerians in terms of a classic Three Stooges scene. Curly is seen banging his head against the wall; when Moe asks why, he replies, “Because it feels so good when I stop.”
And here’s a typical news story describing an American economy that is growing faster in 2013 than 2012:
Friday’s report of third-quarter GDP was the latest positive piece of economic news. Growth was revised up to 4.1 percent, the first above 4 percent and best-performing quarter since fourth- quarter 2011.
“There’s such good news on the economy, and I’m really encouraged about the 2014 outlook,” said Knapp, who now expects companies to show better revenue growth than they’ve been reporting in recent periods.
Joseph LaVorgna, chief U.S. economist at Deutsche Bank, said the third-quarter number could mean that fourth-quarter growth will be even better than the 3 percent he expects-a forecast that’s already more bullish than average.
“The numbers are looking really good,” he said. “On the GDP, the upward revision was all in demand.”
. . .
The third-quarter growth forecast was for it to remain at 3.6 percent, but gains in consumer and business spending pushed it up.There had been a lot of skepticism about the third quarter, as it was inflated by a big inventory number, and the concern was that there would be a giveback for that in the fourth quarter.
“Now that you have better sales, it makes the inventory numbers look even better because producers are building the inventories in anticipation,” LaVorgna said.
Thanks to Ben Bernanke for proving the cushion for America’s head. Of course Ben is much too modest to take credit, and indeed late last year denied the Fed could provide an adequate cushion.
But he did. :)