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Devaluation Is Austerity Done Right

Devaluation Is Austerity Done Right Currency devaluation is best understood not as an alternative to austerity, but as the correct way for a debt-burdened society to implement austerity. Why did Iceland recover and Ireland get worse? Iceland had a currency to debase. And they debased their currency enough to reset the economy and grow again. […]

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economics Uncategorized

Krugman on Bloomberg on the Icelandic Miracle

Today, Iceland is recovering. The three new banks had combined profit of $309 million in the first nine months of 2010. GDP grew for the first time in two years in the third quarter, by 1.2 percent, inflation is down to 1.8 percent and the cost of insuring government debt has tumbled 80 percent. Stores […]