Larry Summers is a Big Fat Idiot

Many people inside the Washington beltway – including, unfortunately, President Obama – think that Larry Summers is a genius.

Of course, Summers was one of the people most responsible for gutting the Depression-era banking laws which helped protect our economy, allowing the big financial institutions to speculate and gamble using insane amounts of leverage, and insisting that toxic derivatives be left completely unregulated.

Arianna Huffington, Naomi Klein and others have argued that – even if smart – his ideas are toxic.

But Friday, Summers proved that he’s really not that smart. On Friday, Summers basically said we should continue to do the exact same things which got us into this mess because:

All crises must end. The “self-equilibrating” nature of the economy will ultimately prevail, although that may take massive one-off government actions. Such a crisis happens only ”three or four times” per century, so taking on huge amounts of government debt is fine; implicitly, we will grow out of that debt burden.

Um . . . sorry to break it to you there Larry, but a group of economics professors has recently demolished the “self-equilibrating economy” theory:

If one browses through the academic macroeconomics and finance literature, “systemic crisis” appears like an otherworldly event that is absent from economic models. Most models, by design, offer no immediate handle on how to think about or deal with this recurring phenomenon. In our hour of greatest need, societies around the world are left to grope in the dark without a theory. …

The implicit view behind standard models is that markets and economies are inherently stable and that they only temporarily get off track. The majority of economists thus failed to warn policy makers about the threatening system crisis and ignored the work of those who did. …

The confinement of macroeconomics to models of stable states that are perturbed by limited external shocks and that neglect the intrinsic recurrent boom-and-bust dynamics of our economic system is remarkable. After all, worldwide financial and economic crises are hardly new and they have had a tremendous impact beyond the immediate economic consequences of mass unemployment and hyper inflation. This is even more surprising, given the long academic legacy of earlier economists’ study of crisis phenomena … This tradition, however, has been neglected …

And when economist James Galbraith spoke at a recent panel on the causes of the financial crisis, the first thing he listed as the main cause of the crisis was “The idea that capitalism … is inherently self-stabilizing.”

Summers a genius?

He’s more like a guy swearing that the Sun really does revolve around the Earth and that the current orbit is just a temporary aberration . . . and that if we just wait a little while, “everything will return to normal”.

Note: The quote from Summers’ speech comes from former chief IMF economist Simon Johnson. Others have confirmed Summers’ statements.

This entry was posted in General. Bookmark the permalink.
  • Larry Summers is merely a mirror for all economists to look into.Economics is the science of creating efficiencies for destroying the planet and the enslaving of humanity toward that end.What ever economists say should be done, -the exact opposite is true.

  • I put most economists & their models on par with high school physics teachers and their "frictionless surfaces." Fortunately, high school physics teachers realize that the real world is much more complicated than the simplistic models they use to educate students. Unfortunately, economists do not.

  • What Don said.Well without capitalism, what would there be for economist to do? I guess we could put them to work on accurately predicting when toilet paper would be needed in public restroom. Ya know…that supply vs. demand equation.LOL.Capitalism, and the associated BS science, is no different than taxes. Its not understood by many, it doesn’t make any rational sense to many, and its convoluted and complex beyond Einstein’s imagination.Its capitalism that creates competitive, greedy monsters out of us all. Summers is just another piece of trash the world has to put up with because we don’t have the manpower to collect and dump all the trash that has accumulated in the USSA since 1913.

  • To think that Summers is an “idiot” is beyond naive. Summers knows EXACTLY what he is doing and the plan has been carried out with near precision. Summers is a major component of the banking elite that has been trying to force us all into economic slavery. Prison is too good for the high crimes, treachery, and treason of Summers and his associates — I vote for immediate execution of these scum. Put a bullet into the inflated heads of a few of these degenerates and I bet the rest of them straighten up pretty quickly. Problem solved.

  • Anonymous is spot on. Who really believes that these multi-billion $ banksters have suddenly turned stupid? Only someone who believes O-Banana could or would save us from the banksters or our corrupt bloated government. But you’re right that Summers is a fat pig.

  • He's not an idiot, he was smart enough to steal trillions from Americans and give them to his Jewish friends, without going to prison.