The Asian Crisis Caused the Asian Crisis
POSTED — August 25, 2013 — Behavioral Finance Puzzles
Thus, if there is a new Asian crisis, it is arguably due to the Fed's QE, though Krugman attempts to dodge this by saying they were just doing their job.
However, as I wrote in Models.Behaving.Badly (http://books.google.com/books?id=lke_cwM4wm8C&q=krugman#v=snippet&q=krugman&f=false), Krugman and Wells once attributed the 2007-8 crisis to the Asian currency crisis of 1997.
"According to Krugman and Wells (http://www.nybooks.com/articles/archives/2010/sep/30/slump-goes-why/), the crisis of 2007-2008 was caused by the global savings glut. That was caused by the Asian currency crisis of 1997-8, which stimulated Asian countries to avoid a repeat by running net surpluses rather than net deficits.
Thus, we have come full circle.
As I wrote in Models.Behaving.Badly directly beneath the previous quote:
But what caused the Asian currency crisis? And what caused whatever caused that? This is a good example of what Spinoza would call an inadequate explanation
You pays your money and you takes your choice.