I've always believed that a speculative bubble need not lead to a recession, as long as interest rates are cut quickly enough to stimulate alternative investments. But I had to face the fact that speculative bubbles usually are followed by recessions. My excuse has been that this was because the policy makers moved too slowly - that central banks were typically too slow to cut interest rates in the face of a burst bubble, giving the downturn time to build up a lot of momentum.
Paul KrugmanThe French, unfortunately, actually believe what they say, and that has been very destructive.
Paul KrugmanIn short, it's a great economy if you're a high-level corporate executive or someone who owns a lot of stock. For most other Americans, economic growth is a spectator sport.
Paul KrugmanOne way in which Americans have always been exceptional has been in our support for education. First we took the lead in universal primary education; then the โhigh school movementโ made us the first nation to embrace widespread secondary education.
Paul Krugman