Run time: 12:06
https://www.youtube.com/watch?v=67F4hTtCNa4
Posted on YouTube: August 09, 2011
By YouTube Member: PBSNewsHour
Views on YouTube: 110
Posted on DU: August 09, 2011
By DU Member: alp227
Views on DU: 1883 |
Stocks plummeted on Wall Street and around the world on Monday, as President Obama tried to reassure investors that the United States continues to be an "AAA country." Judy Woodruff discusses the historic drop in the stock market with three experts.
In this discussion:
- Paul Krugman, Princeton University economist and
New York Times columnist
- Kenneth Rogoff, Harvard professor, former chief economist for the International Monetary Fund and co-author of
This Time Is Different, a new book about financial crises
- Terry Belton, J.P. Morgan Chase head of fixed income strategy
TranscriptKrugman's first statement:
The reason that the S&P downgrade mattered, if it did at all, is not that it made people think that U.S. debt was unsafe. In fact, people have piled into U.S. debt, right? Interest rates on U.S. government debt are at their lowest point since January 2009.
What the downgrade did is, it made people think that the U.S. government is now going to be hamstrung, not able to take action to prop up the economy, not because it can't actually finance the debt -- the spending, not because it's in real fiscal trouble, but because some guys at S&P by calling that downgrade have bullied the U.S. economy, have bullied the U.S. government into taking actions that are going to be the wrong thing to do.