Almost Classical

And now we see the Broken Windows Fallacy taken to an extreme — on CNBC of all websites. Damage From Sandy? What About Potential Economic Boost? - Asia Business News - CNBC The positive multiplier effect of reconstruction after Sandy could be as much as five times, according to Frank Holmes, CEO and CIO of money manager U.S. Global Investors. If the cost of the damages comes up to $20 billion, the economic boost in terms of spending and activity could be $100 billion, he said. Hurricane Sandy might appear to create economic activity, but such activity is not going to have the multiplier effect some theorize. At least, not based on the experiences of previous disasters. By this twisted logic, the horrible events of Sept. 11, 2001, should have been an economic boost: buildings and transit lines had to be rebuilt. Instead, the economic effects linger for many families and businesses. Sandy is just one more thing New York and New Jersey didn't need. There are many, many probl...

Paul Krugman is at it again, either intentionally misleading readers or demonstrating an odd lack of familiarity with an economic theory. I'm assuming he is misrepresenting the theory he discusses and is misleading readers. Broken Windows and the iPhone 5 http://krugman.blogs.nytimes.com/2012/09/11/broken-windows-and-the-iphone-5/ September 11, 2012 There's been some buzz about a report suggesting that the iPhone 5 could, all by itself, give a significant boost to the US economy. The key point is that the optimism about the iPhone's effects has nothing (or at any rate not much) to do with the presumed quality of the phone, and the ways in which it might make us happier or more productive. Instead, the immediate gains would come from the way the new phone would get people to junk their old phones and replace them.   In other words, if you believe that the iPhone really might give the economy a big boost, you have — whether you realize it or not — bought into a versi...