Financial Crisis: Article of the "Week" Archive

WSU Heterodox Economists' Financial Crisis Home Page

This guide is developed through e-mail discussion on the list serves of the Association for Evolutionary Economics, the Union of Radical Political Economics, The International Association for Feminist Economics and discussions among the heterodox economists of the economics department at Wright State University. (Sirisha Naidu, Zdravka Todorova, Paulette Olson, Rudy Fichtenbaum, and Barbara Hopkins)

Updated August 2, 2009

March 21, 2009

Geithner: "A principal virtue of this mechanism is to use the financial interests of investors to help set the price. Because they have money at risk, they're going to make better judgments about how to set the price for these assets than the government could hope to make" in LA Times.

And Joe Stiglitz "Don't confuse saving bankers and shareholders with saving banks" at Common Dreams.

Aside from whether the plan Geithner is describing is a good plan or not, apparently the government has not learned from Alan Greenspan's public embarassment that we can not assume that because investors have money at risk that they are any smarter than bureaucrats.  If investor's could understand the level of risk associated with these toxic assets, we wouldn't be bailing out the banks.

Brad DeLong explains the plan.

Krugman is not impressed.

Simon Johnson and James Kwak aren't either. Simon Johnson is repeatedly unimpressed.

Dean Baker thinks it won't work.

Ask yourself if the new plan addresses any of the criticisms raised in the past months by Doug Henwood, or Joe Stiglitz, or Dimitri Papadimitriou and Randall Wray , or Michael Hudson, or Jamie Galbraith (note the order of these links has no particular meaning.)

March 13, 2009

John Harvey has put together a Blog to explain Post-Keynesian economics (and what it can teach you about the financial crisis) to those who are not economists (all his friends who keep asking him what is going on).  You can start with lesson 1 or read it like a blog and start with today's comments (although, as with textbooks, it pays to start at the beginning).

It you already have a really good grasp of the macroeconomy, but you have come to realize that the monetarism and new classical economics you were taught in school doesn't help you understand what's happening (see below for criticisms of these schools of thought) you can check out Randall Wray's " Financial Markets Meltdown: What Can We Learn from Minsky?" for a more advanced explanation of Post-Keynesian insights into the current financial crisis. 

March 3, 2009

Nitasha Kaul "Bankers on Benefit" at ZNet.  An easy to understand and accessible article on why the financial crisis should not have surprised us and highlights how the financial crisis exposes the very different treatment of bankers versus labor.