"Revenge of the Glut," is an article written by Paul Krugman. The article appeared in the New York Times on March 2, 2009. The article was directed toward the American people, and for those who keep track of all financial crisis. Krugman wrote the article to express his thoughts on the debt crisis in the U.S.
Krugman argues that the answer to the debt crisis is in a speech that was given four years ago by, Ben Bernanke. Bernanke believed the causes of the debt crisis, were not in America but Asia. Bernanke explained the emerging of economies in Asia had been huge importers of capital, and after the Asian Crisis, the country exported capital to the world including the U.S.
Krugman explains the exporting of capital to the U.S. as,"our giant trade deficit." With this in mind, he explains that the inrush of capital created the illusion of wealth, and by time the wealth would burst like a bubble. And of course it did. Krugman believes that this is how we got into the mss, and now are looking for a way out.
