Saturday, December 27, 2008

Krugman’s Bubbles

Paul Krugman had another one of his columns about what’s the next bubble. He was wondering as he has wondered before what is going to be the next bubble. That way, we will know it when it starts to expand and pull the economy out of the remnants of the latest busted bubble; as was done previously; according to Krugman.

I had an epiphany and like any good epiphany (Are there bad epiphanies?), I had to comment. Like a lot of other comments I made at Krugman’s site, this one never appeared or I was never able to find it. (Is it me? Do you have to be a liberal to comment on Krugman’s site? That’s so un-liberal. Maybe I have to be signed in. I don’t remember if I was.)

Anyway, since as you will shortly read - if you continue, I knew my comment was going to be a blog post, so here it is:

Is this a game? Can we win a “Kruggie”?

Are we (the commenters) supposed to guess what we think is the next bubble and you award the best or most bubblicious suggestion an award? Honorable mention on Conscious of a Liberal*?

OK, here goes:

Export Trade Bubble. Non-starter. We are not positioned to produce anything that could not be produced cheaper somewhere else − except maybe exceedingly pretentious demand (No, the French got us beat on that one.) or irrational exuberance (Oh yea, that’s us.). The ship sailed on that possibility long ago.

Regulation Bubble − the business of regulating the financing of housing, automotive, and well…finance itself, Wall Street, derivatives, and investment instruments that go bump in the night and nobody really understands. The ugly side of Keynesian Economics in which all the fears of free marketers come true − in a bubble form.

Internet Bubble. No, not the bubble, that’s so last century’s bubble. This is a new one based on the technology that has developed since the technology that caused the bubble. Like those glasses in one of William Gibson’s novels − Virtual Light, I think − a heads up display of all the information available for EVERYTHING going on around me.

You remember Gibson. He coined the term “cyberspace” back when Senator Al Gore was getting funding for those guys who did invent the internet. Why can’t I look at my iPod and know what is in every store in every direction I’m looking no matter what corner I’m own? That’s bubble-worthy.

Why can’t my car drive itself at least on the interstate? I could read your column because I would always be online − as well as my car and everybody else’s on the interstate to the transportation authorities. That’s an internet-transportation bubble.

Sorry, my comment has become a post and will appear on my blog, out there with all the great unwashed blogs. Your column got the juices flowing. I will exercise good blog protocol and site your column, and (I hope) you give me credit for the term “Kruggie”. Or, would you prefer “Krugy”?

*Pun intended. Conscience and liberal are redundant. I have no doubt that liberals are conscience; by definition of terms that could not be one without the other. What I wonder is: are true liberals ever truly conscious.

-30- <== that used to mean end in journalism and represents the end of my comment. So for good or bad, that’s what I commented. Maybe Krugman didn’t like the Kruggie remark. I thought that was good, but hey, what do I know? I think a second internet bubble is a very likely candidate. The connectivity of iPods and the information available at hand could change everything, but more importantly, it could ignite another techno-econo bubble. Maybe Krugman should develop a whole new field of economics – maybe even get a second Nobel – on bubble economics, going from one bubble to the next. Assumedly, it would be like the old fashion boom and bust in which the boom is always bigger than the bust or why would you do it? On second thought, the regulation bubble is an oxymoron. I shouldn’t put it in the comment. If there is regulation there can be no bubbling of anything. That’s the problem with regulation. While there may be little to no bust, there just as little to no boom. The regulators make a nice, stable living, but the economy goes nowhere – forever. But I like my auto related bubble. The hook in the bailout to the car industry was to come up with some kind of car Americans would want to buy. A car with a PC or visa versa, now that would be something worth doing a trade-in. When driving me down the interstate, the car doesn’t need to see, just tell it where it is and which direction to go. It would be in communication with the other cars on the road and would know their direction – or vector in object moving in relation to one another talk and exchange other info as needed…or required. Of course, it could detect objects in the road that are not suppose to be there, but would not disturb me otherwise. A car company bailout bubble. And that’s the bubble roundup from here at blog central, or to be more precise, in the center of the blogs.