Here is a chart showing the monthly numbers and consumer confidence:
And Krugman points out that:
Monetary policy obviously isn’t enough. It’s time to raise Keynes: we need big fiscal stimulus, now now now.
I agree with this. Financial stability is a necessary, but not sufficient condition for economic growth. The government needs to step in and provide real stimulus to the working class and the unemployed.
We are in for a lot of pain. Quoting Krugman again:
So the “worst recession in 25 years” thing is now baked in. The only question is whether we hit “worst slump since the Great Depression” territory.
