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Paul Krugman On The Emerging-Market Turmoil




Alternatively, flailing investors frustrated by low returns and desperate for yield can delude themselves, pouring money into ill-conceived projects, be they subprime lending or capital flows to emerging markets. This can boost the economy for a while, but eventually investors face reality, the money dries up and pain follows.

If this is a good description of our situation, and I believe it is, we now have a world economy destined to seesaw between bubbles and depression.

Read Full Story: http://www.businessinsider.com/paul-krugman-on-em-...

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