CNBC's Ron Insana: 'We Need More Stimulus'
CNBC's Ron Insana asserted on today's "Andrea Mitchell Reports" that the United States does not have a debt problem. "We need more stimulus. We have a growth crisis in this country, not a deficit crisis," argued Insana. He also insisted that Europe, which also has debt problems, should not pursue austerity measures. "I think people might be looking at Europe and saying listen, they need austerity. They don't need austerity either," said Insana.
The business reporter appeared openly disdainful of those who are calling for greater fiscal restraint by the federal government.
"There is a belief among what I'll call faux-conomists out there, some of whom are on the right, some of whom are on the left, that austerity in the United States right now will bring prosperity. That is not the case. We are at a very delicate point in this economic recovery where a fiscal policy that's too tight may weaken the economy, not shore it up," warned Insana, adding that "Everybody is getting a little too austere for this point in the cycle, and I think we're making, we're on the brink of a policy mistake that could prove rather nettlesome for us."
Insana did not comment on the effects that mounting debt might have on the American economy, although he admitted that entitlement spending was a looming problem:
"The real problem is entitlement spending and Social Security, Medicare, for future generations, people under 55."
A transcript follows.
MSNBC
ANDREA MITCHELL REPORTS
08/04/2011
3:44 p.m. EDT
RON INSANA: No, and you know, we did see - we got a private number yesterday from ADP, the payroll processing company that does these estimates of payroll growth, and it showed gains in the private sector of 114,000 which is bigger than they're expecting tomorrow. But, you know, the thing here Andrea is that, and I've made this point here on CNBC, is that there is a belief among what I'll call faux-conomists, out there, some of whom are on the right, some of whom are on the left, that austerity in the United States right now will bring prosperity. That is not the case. We are at a very delicate point in this economic recovery where a fiscal policy that's too tight may weaken the economy, not shore it up, and we'll get a better fix on that tomorrow, particularly if the employment number is bad. You know, you throw 100,000 government workers or more out on their feet in a job market where there are 4.6 applicants in the US for every job available, that's not going to make the unemployment rate go down, and I think people might be looking at Europe and saying listen, they need austerity. They don't need austerity either. We need more stimulus. We have a growth crisis in this country, not a deficit crisis, and they have both in Europe and add to that the fact that China's raising interest rates, India's raising interest rates. Everybody is getting a little too austere for this point in the cycle, and I think we're making, we're on the brink of a policy mistake that could prove rather nettlesome for us.
ANDREA MITCHELL: Interesting Ron, and even the real deficit hawks involved in these debt ceiling talks back-loaded the real cuts. It's only $22 billion in the near term precisely because of those concerns.
INSANA: Listen, Andrea, we both talk to people who know this stuff backwards and forwards. The real problem is entitlement spending and Social Security, Medicare, for future generations, people under 55. They can fix that relatively quickly and relatively painlessly. Cuts in discretionary spending right now in my estimation are a very bad idea and hopefully, we don't get to the point where our austerity on the fiscal side is so severe that the Fed will have to more than make up for it with still easy money policy for as far as the eye can see.
- Eric Ames's blog
- Login to post comments
Comments
Um,
Submitted by HockeyKid on Thu, 08/04/2011 - 4:33pm.
the guy's name is, literally, "Insane-a". Need we say more?
"Beauty is only skin deep, but liberal's to the bone." - me
The only other thing that
Submitted by ForeverOnTheRight on Thu, 08/04/2011 - 6:02pm.
The only other thing that should be said is, "You're fired!"
Somebody pith this guy. He's already gone.
Submitted by JLin on Thu, 08/04/2011 - 4:37pm.
Unbelieveable...
Next week, ol' Ron here....
Submitted by Wiiliam1972 on Thu, 08/04/2011 - 4:38pm.
.....will be part of the Ohbarry Administration.
You don't have to go far in
Submitted by Ruths husband Ben on Thu, 08/04/2011 - 4:38pm.
You don't have to go far in the media these days to find the clueless. There must be some kind of dog whistle-like siren that normal people can't hear that beckons them to a career in the media.
If you need "stimulus", Mr. Insana,
Submitted by almostacowboy on Thu, 08/04/2011 - 4:46pm.
I would recommend methadrine to you.
It's actually true, but the
Submitted by robert108 on Thu, 08/04/2011 - 4:48pm.
It's actually true, but the stimulus we need is private sector profits and a big increase in the investment/reinvestment cycle, with domestic energy development.
Govt spending is an obvious failure.
But not really
Submitted by lsudolemite on Thu, 08/04/2011 - 5:27pm.
Obama's projected deficit numbers already assume an economic growth rate of at least 4%, and we're not even getting close to touching that, even if we don't technically slide back into recession.
It is simply impossible to grow our way out of this level of debt. Like every other country in this situation, when nobody else will lend you money, the wizards at the Fed will simply print more Monopoly money to the point that the dollar is entirely worthless.
It's all so easy according to Insana -- JUST SPEND MORE $$$$
Submitted by Galvanic on Thu, 08/04/2011 - 5:09pm.
INSANA: Listen, Andrea, we both talk to people who know this stuff backwards and forwards.
In fact, Mitchell's husband -- former Fed Chair Alan Greepspan -- conceded a year or so ago that he got it wrong. All those years of advising Presidents and the Congress, and he now says he was wrong. Thanks.
And Insana himself started a hedge fund company called Insana Capital Partners, that imploded in under two years. Through its Legends fund -- described as a 'fund of funds' -- Insana didn't analyze the markets and steer the investments; he merely connected investors to other hedge funds. For this valuable service, his firm charged a 1.5% management fee plus 20% of any profits earned -- that's on top of the cut the actual hedge fund took (typically 5% management fee and 40% cut of the profits). What a great deal for the investor, no?
So, were these grand sages of economics backwards or forwards?
INSANA: The real problem is entitlement spending and Social Security, Medicare, for future generations, people under 55. They can fix that relatively quickly and relatively painlessly.
Well, don't leave us in suspense, cowboy. How do we fix it "quickly and relatively painlessly"? The Democrats certainly want to know. We'd all like to know.
Insane wants stimulus?
Submitted by jdhawk on Thu, 08/04/2011 - 4:53pm.
Insane wants stimulus? Coming right up!
I bet if O'bozo said he would not run in 2012, there would be a correction of some magnitude in both the markets and the economy. He is the biggest drag on the economy and markets with his regulations, Obamacare,, threats of new taxes and class warfare, and mindless over spending,
Tell your family and friends, write your congress person and senator. This could be the start of a beautiful relationship!
Naw . . . it would never happen.
As an economist, all I can
Submitted by rbosque on Thu, 08/04/2011 - 5:00pm.
As an economist, all I can say is that this person is just plain nuts. Borrowing more money and further devaluating the dollar? How is that going to help the economy? It might bring temporary relief for the recipients in the short term but in the long run, it will put a nail in the coffin which was our economy. If they do this, it would be disasterous!
Stock Market
Submitted by Brad90956 on Thu, 08/04/2011 - 5:02pm.
Um, didn't the stock market just lose 500+ points today because U.S. and global markets (especially Europe) all have serious debt problems.
Stock market. No, not only
Submitted by bassndude on Thu, 08/04/2011 - 5:23pm.
Stock market. No, not only the debt. Tho that did figure into it, that was not all. Jobs report is due out tomorrow, on top of the unemployment numbers that came out today. There are lots of factors that contributed to the fall today. If the jobs report tomorrow is as bad as the unemployment numbers that came out today, the market will fall another 2 to 3 hundred points, or more. There is no support for the DJI before 9700.00 at this point. So there is alot farther to go.
If this was just a correction, then gold, silver, oil and gas would not have fallen like they did either. So this was a lot of traders going to cash. And it is my thinking that there will be more of this tomorrow.
Save a SeAL, club a liberal/troll!!
Stock market. No, not only
Submitted by bassndude on Thu, 08/04/2011 - 5:23pm.
Stock market. No, not only the debt. Tho that did figure into it, that was not all. Jobs report is due out tomorrow, on top of the unemployment numbers that came out today. There are lots of factors that contributed to the fall today. If the jobs report tomorrow is as bad as the unemployment numbers that came out today, the market will fall another 2 to 3 hundred points, or more. There is no support for the DJI before 9700.00 at this point. So there is alot farther to go.
If this was just a correction, then gold, silver, oil and gas would not have fallen like they did either. So this was a lot of traders going to cash. And it is my thinking that there will be more of this tomorrow.
Save a SeAL, club a liberal/troll!!
No, Brad
Submitted by Galvanic on Thu, 08/04/2011 - 6:38pm.
It's attributed to global fear of Tea Party terrorism, according to MSNBC.
Hell yeah, they need more stimulus!
Submitted by Newsbubba on Thu, 08/04/2011 - 5:25pm.
I read in a Raleigh, NC paper today about a NC State Senator, A DEMOCRAT, who's company scammed the government out of at least $100,000 of stimulus money from the last Obama stash.
His company claimed to have used the money to help the "poor people" repair their homes, but it seems that he lied and just forged the signatures. In one case the house had burned down and the lot had been sold.
Election is coming up and Obama needs a new stash so that the Dims can campaign hard so that they can continue to help the "poor."
It is so touching.
It's Bush's fault
Submitted by Galvanic on Thu, 08/04/2011 - 7:07pm.
To paraphrase the legendary Reverend Ike: "No one said the Senator has to be poor."
Cut me a check...
Submitted by shooter on Thu, 08/04/2011 - 5:46pm.
Dear Mr. Obama:
I just saved my own job.
So, please send me a check for $300,000.
Thank you.
_________________________________________
"An armed society is a polite society" -- Robert A. Heinlein
"We need more stimulus."
Submitted by Gat New York on Thu, 08/04/2011 - 5:46pm.
This from a guy who was a career business journalist and late in life thought he could start his own hedge fund which failed within 2 years. Should we be surprised by his failure in business?
Socialism = government intervention = failed economics
Capitalism = free market = growth economics
What are you talking about?
Submitted by hayate1 on Fri, 08/05/2011 - 2:34am.
You known the difference between theory and reality, right?
The theory that free markets=growth or that gov intervention=failed economics is a generalized theoretical notion. A notion that is not supported by reality.
In the broadest comparison of the two theories at work in the real world it is clear that the exact opposite is closer to truth. Not exact , but much closer to reality than your theory.
what were the philosophies and actions leading up to the great depression? they were as pure a free market, no government intervention as we have ever had. as the economy tanked, hoover cut spending and shrunk the budget. what happened?
the years leading up to the second largest economic collapse in our nations history where based on no regulation, low taxes aND THE unfettered free market. What happened?
Don't fall back to ideology now, stick to the data.
"Facts are not decided by how many people believe them. Truth is not determined by how loudly it is shouted."
Check Chris Matthew's leg.
Submitted by Barack Must Go on Thu, 08/04/2011 - 5:51pm.
Check Chris Matthew's leg.
Wall Street tanking
Submitted by MidAmerica on Thu, 08/04/2011 - 5:52pm.
If the stock market really goes down will obama come up with another Wall Street bailout because he is counting on millions in campaign contributions from Wall Street?
Correct! The bulk of the debt ceiling cuts were "backloaded"
Submitted by Rush Fan on Thu, 08/04/2011 - 5:54pm.
to many years in the future. Democrats, for all their apparent complaining, understand that they hoodwinked Republicans during the debt ceiling negotiations. There may be no real cuts. Republicans were so afraid of getting blamed for a "default' that would never have happened, they caved.
President Obama may be the worst President in history, but he is one of the greatest scheming politicians this country has ever had.
Insana is correct
Submitted by OffTheLows on Thu, 08/04/2011 - 6:47pm.
but there are methods to stimulate the economy that require the govt to get out of the way. You can fast track domestic oil and gas production easing the regulatory process. You can allow repatriation of foreign profits. You can lower the corporate tax rate getting rid of subsidies and write offs for politically favored industries. You can open up the H1B visa process and get a tidal wave of highly skilled workers in this country who will make good money and fill up a lot of that excess housing inventory. You can also sign free trade agreements. You could have a private sector wiz like Jamie Dimon come in and take Geithner's place at treasury to boost confidence in the markets. These are things that can be done to stimulate the economy without more deficit spending.
I would love to hear this guy
Submitted by Scuba Dude on Thu, 08/04/2011 - 7:25pm.
I would love to hear this guy say this to Rick Santelli. Rick would redefine "Tearing him a new one" after getting through with him.
a talking head with every day
Submitted by jkwtrading on Thu, 08/04/2011 - 7:25pm.
a talking head with every day less and less hair. that's how I see him..
stimulate all you want
Submitted by Tjexcite on Thu, 08/04/2011 - 7:56pm.
But with the new regulations 600+ in July alone, will just take any dollar put in right back out with 5 more. How is that stimulating you still have to pay more in new regulations with only one law being written. How many new regulations will show up in August. There may be a tax on how many new employees you hire or layoff. sounds stimulating.
Where
Submitted by hayate1 on Fri, 08/05/2011 - 2:23am.
does this 600+ number come from?
"Facts are not decided by how many people believe them. Truth is not determined by how loudly it is shouted."
We need more cowbell.
Submitted by Red Jeep on Thu, 08/04/2011 - 11:52pm.
.
The Definition of Ron Insana
Submitted by Cool Arrow on Fri, 08/05/2011 - 1:19am.
Continuing to demand more Stimulus and expecting to see different results.
But don't be too hard on yourself, Insana. Over on FOX tonight, I actually heard an idiot proclaim "You really haven't lost anything on your stock unless you sell it"
What The Brits are saying about this fiasco.
Submitted by hayate1 on Fri, 08/05/2011 - 2:22am.
BRITAIN
The British press has been characteristically brutal in its assessment of both Republicans' intransigence and Obama's failure to stand up to their demands. The Independent writes in its lead editorial that while "Armageddon has been averted … as long as a generation of Republican politicians feel entitled to hold a gun to the head of the credit of America to secure their political ends -- disaster will never be far away."
Guardian economic editor Larry Elliott compares the United States to a "tinpot Latin American dictatorship circa 1980" and calls it a "country where a plutocracy is firmly in control," suggesting that "If the U.S. were any other country it would be seeking help from the International Monetary Fund." In the same paper, writer and activist George Monbiot writes that the Tea Party "consists of people who have been harmed by tax cuts for the rich and spending cuts for the poor" amd who have been misled by corporate owned media. But Monbiot also senses another evil lurking: The current state of affairs in Congress is "a kind of political coup," he writes. "A handful of billionaires have shoved a spanner into the legislative process."
In the Telegraph, Toby Young notes the irony that the Democratic U.S. president now appears to be leaning to the right of the British Conservatives: "A year ago, American conservatives were showering David Cameron with praise for adopting such a radical approach to reducing Britain's deficit and contrasting him unfavourably with their own spendthrift President. Now, our Prime Minister looks like a weak-kneed liberal in contrast to the hard-headed Obama." Young believes that on both sides of the pond, a "sea change has taken place" and that "Socialist welfare programmes have become politically toxic."
Last year, it was the normally free-market United States that was taken aback by the harshness of British and European budget cuts. Things appear to have returned to normal.
"Facts are not decided by how many people believe them. Truth is not determined by how loudly it is shouted."
Another stolen unattributed post.
Submitted by The Vet on Wed, 08/10/2011 - 6:40am.
The British press has been characteristically brutal in its assessment of both Republicans' intransigence and Obama's failure to stand up to their demands. The Independent writes in its lead editorial that while "Armageddon has been averted....
The entire post is stolen from foreignpolicy.com.
Star Drek
Submitted by Chris Norman on Fri, 08/05/2011 - 2:52am.
Captain Ron T Insane-a of the Starship: "More stimulus power!"
Engineer Scott Tea: "Captain, I canno' apply more power - the engines are going ta blow!"
Captain Ron T Insane-a of the Starship "I don't care about the engines! More stimulus power!"
BOOM!
Starship blows up. End of story....
Is This Guy Freakin Insane???
Submitted by scottyusmc on Fri, 08/05/2011 - 6:05am.
YES!!!
Failed hedge fund manager
Submitted by Cactus Kurt on Fri, 08/05/2011 - 8:31am.
Ron Insana-Costanza is a FAILED hedge fund manager. He's a failue in his own profession. Why does his opinion matter?
more stimulus
Submitted by jessieH on Fri, 08/05/2011 - 10:48am.
No, what we have is a stupidity crisis. Every time I turn on the tv, I hear some idiot, trying to say we need more spending. Someone, please, teach these fool liberals another word. "Spend" is really getting old. How about a four letter word. Maybe they can remember a shorter word. I like the four letter word "save". It's only one syllable so maybe they can comprehend the meaning.
Go for it
Submitted by Mutantone on Fri, 08/05/2011 - 1:24pm.
I say do it but give every American the money send out checks to the people and watch the economy rebound. If all the money they have spent was given out equally to every one with a real social security card and photo id the money would produce jobs.