Obama looks like another Jimmy Carter to me.

McCain is more like Richard Nixon.

The news about Bako should send the Dow up about 450 – 500 at tomorrow’s opening bell.

He will go down as the worst president in history.

oh wait…

I myself will be writing in “None of the Above”

but maybe you could become like our spiritual guru or something

I just got pwned.

The financial messes were clear causes, and the war was a clear solution.

Even Wikipedia describes several schools of thought about the Great Depression. It’s not settled by any means.

I think the stuff we’re doing that incorporates the lessons we’ve learned (which is to say, not really the bailout bill) is not making things worse.

I think you’re dead wrong on that one. If there’s no agreement on the causes or the solution, how can we know we’re not making things worse?

And the bailout bill does reflect the lessons a certain school of thought on the Depression learned. They believe the problem was not enough money circulating. These are the people who say the Japanese could have avoided their long stagnation if only the government spent more money.

I found this paper (PDF) fascinating. It was written in 2006 by a couple of analysts at PIMCO. It’s remarkably prophetic. They argue that Bernanke, despite being a scholar of the Great Depression, doesn’t really understand it.

The summer of 1932 marked the trough for US economic growth, which was well in the midst of the Great Depression starting in 1929. Global sovereign defaults were well underway by 1931. Turkey, China, Bolivia, Peru, Cuba, Brazil and Colombia all defaulted on their debts in 1931. Hungary, Yugoslavia, and regrettably Greece defaulted in 1932. In 1933, Austria and Germany joined the club. And, by 1934, all debtor countries except Argentina, Haiti, and the Dominican Republic had suspended debt service. Are we to accept the conventional wisdom that a mistaken, overly restrictive monetary and fiscal policy in the US created the Great Depression and led to these global sovereign defaults? It seems equally, if not more likely, that an imbalanced global trade system jarred by restructuring in Germany and Great Britain, and by prior revolutions against free markets in Russia and China may have been the initial and crucial culprit. The global constriction of trade was the result of several dependent and independent political and economic upheavals during the decade following World War I. It is a massive presumption to state that a more stimulative Federal Reserve (a la 2001-2002) could have prevented the course of events in the early 1930s.

The lessons for present-day policymakers are stark. Recent anti-deflationary policy in Japan, the US, and Europe are all predicated upon the conventional analysis emanating from the Great Depression. We feel these are mistaken and misguided.

They saw this coming two years ago.