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Christina Romer's Prepared Testimony before Joint Economic Committee

You can find prepared testimony of Christina Romer, chair of the president's Council of Economic Advisers, on the Joint Economic Committee's Web site where she is testifying right now. You can also find prepared remarks from the committee's chair, Rep.Carolyn Maloney (D-N.Y.).

By Sara Goo  |  April 30, 2009; 10:59 AM ET
 
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Comments

True to form in root cause avoidance, Ms. Romer in her prepared testimony, discusses recent asset price declines and a reduction in the margin propensity to consume out of wealth. Then she turns to derivative asset prices and how banker's consternation regarding those asset prices is constraining lending. Finally she describes how expanding credit is essential for economic stabilization and to bring back growth.

Perhaps she and the other policy wonks (Larry, Timmy, et al) should examine how bloated with debt, the other side of the ledger entry from credit, the economy already is. Moreover, how it truthfully was the Debt and Leverage Bubble that distorted debt based "financial" asset prices, encouraged fraudulent lending, and entrapped investors and consumers in mis-priced real and financial assets. Further, the Home Equity ATM that propelled the smoke and mirrors FIRE (Finance, Insurance and Real Estate) driven economy over the last 10 years, excluding the most recent few, has run out of cash.

But no, that does not serve the bankster's needs. It is not in their interests to point out that asset prices are being marked to myth and the house of cards is continues to tumble. More so, it must not be pointed out that there is no cure for the real economy struggling with too much debt and onerous debt service levels can will not be written down, again, because it does not serve the banksters. Like a drunk seeking to relieve the pain of a hang-over, clearly, the solution must be more credit (debt) and accompanying interest payments.

There can be mistaking the spin being dictated from Wall St. The banking and finance oligarchs, have captured the spokes-mouths of both party's puppet administrations inside the District of Corruption, and will continue to distort and provide advice and recommendations that further their own goals, at the expense of the rest of the real economy's participants.

Posted by: tryin_to_profit | April 30, 2009 4:26 PM | Report abuse

small correction, There can be no mistaking the spin...

Posted by: tryin_to_profit | April 30, 2009 4:43 PM | Report abuse

I have listened to a lot of the video from the Romer's testimony available on the Joint Economic Committee website.

First of all Rohmer has this flowery academic, all is happy approach. I have listened to Alice Rivalin many times and Rohmer is not even close in terms of being credible.

Let me start about her initial assesment of what went wrong. She procedes to address the results of what went wrong, but nothing aout the fraud in loan underwriting, agency ratings, banks taking unsustainable risk with high lererage ratio's and most of all nothing about Credit Defaut Swaps being written with no capital reserves. It would be like State Farm writing fire insurence and not holding any reserves for payment.

I maintain that untill we address what went wrong, we do not address fixing the problem. Then she goes through all the things they are doing and then addresses how things still do not look good. She talks about 4th quarter turn around, but does not give any basis for it.

In short, if Ms. Rohemer was offering a course, I would not take it because I just do not find her serious like I have found people like Alice Rivalin in the past.

Posted by: fiscalliberal | April 30, 2009 7:14 PM | Report abuse

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