Has Joseph Stiglitz Learned Nothing?

Another day passed on Wall Street… with nothing much to show for it. Stocks rose… gold added $12. No one seemed to have much of an idea what is going on…

Two of the world’s best investors – George Soros and John Paulson – are buying gold heavily. What do they know? Maybe nothing…maybe they’re wrong.

Who knows? Nobody…

Our guess is that they will look like idiots for a while… and then look like geniuses. As we told a radio interviewer yesterday – Tokyo today… Buenos Aires tomorrow.

Speaking of Buenos Aires, and moonshine, Nobel Prize winner Joseph Stiglitz gave a speech in Argentina this week. The orator was equal to his audience. He spoke nonsense; the Cristina government was happy to hear it. The Buenos Aires Herald reports:

During his speech, Stiglitz praised the Government’s export duties policies, assuring that thanks to them benefits that went for the exporters as a consequence of leaving the crisis behind, helped in the process of income distribution.

The Nobel Prize winner also warned about a slowing down of global growth. When asked by Ambito.com on his opinion on the alleged “stagflation” that according to some local economists Argentina is entering, Stiglitz replied: “I have no detailed information on what is going on in Argentina. Growth is slowing down on a global scale. Europe is in a recession, China and India are seeing less growth, which will lead Argentina into implementing good policies to avoid such deceleration. And if the wrong policies are implemented, the slowing down of the economy could be even more severe.”

However, when asked what those “wrong policies” could be, the economist avoided a straight answer: “that would demand getting into details about policy and I don’t feel in any condition to exercise an opinion on it.”

When faced with questions regarding how state intervention affects a country, Stiglitz replied that “there isn’t a single action that can measure the level of intervention. Governments always intervene. Markets only exist in a context of laws, regulations, rules and policies. There will always be rules in regulations and what matters is having the correct regulations available.”

Has Mr Stiglitz learned nothing? There are rules. There are regulations. But there are no ‘correct’ regulations. That is to say, no one can ever know what is the correct regulation is. Every manipulation has unforeseen consequences that cannot be foretold. Why? They are unforeseen!

The only real choice is ‘more’ or ‘less.’ And ‘less’ is almost always the right answer. Interference is an expense. The less of it you have, the better off you are.


Bill Bonner
for Markets and Money

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Bill Bonner

Bill Bonner

Best-selling investment author Bill Bonner is the founder and president of Agora Publishing, one of the world's most successful consumer newsletter companies. Owner of both Fleet Street Publications and MoneyWeek magazine in the UK, he is also author of the free daily e-mail Markets and Money.
Bill Bonner

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2 Comments on "Has Joseph Stiglitz Learned Nothing?"

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Nothing stupid about either Stiglitz or Bernanke as phenomena. Don’t think of them as people. They are functionaries pulled up for a purpose. Their ideas never made sense in terms of sustainability but their narrative kept those with ADD that pulled them up from the guillotines for a few moments longer. The progrom is also extended and pretended. “Govt debt can be forever cheap despite the fiscal irresponsibility”, “inflation can be kept at bay even as we QE repeatedly”. We are on our way down the track to “eternity”. Beyond the near sighted horizon of those with ADD there is… Read more »

Less is not always more. More is not always less. Some things are known, when history repeats. Feed the pigs, but slaughter the hogs. Greed must be governed.

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