- Self-fulfilling outcomes of pessimism or optimism, with major macroeconomic implications.
- Incomplete or partial policy measures can make things worse.
- Financial investors are schizophrenic about fiscal consolidation and growth.
- Perception molds reality.
Monday, December 26, 2011
IMF Chief Economists Blames Problems on Investors
Olivier Blanchard is a very well-respected academic economist, and currently also Chief Economist at the International Monetary Fund. He sees today's current big problems primarily due to investors.