Pinning Krugman down

On his various theories about the cause of the crash.

Today:

What really mattered was free-market fundamentalism. This is what led Ronald Reagan to declare that deregulation would solve the problems of thrift institutions — the actual result was huge losses, followed by a gigantic taxpayer bailout — and Alan Greenspan to insist that the proliferation of derivatives had actually strengthened the financial system. It was largely thanks to this ideology that regulators ignored the mounting risks.

Before the crash:

And in the face of rising oil prices, which have left many Americans stranded in suburbia — utterly dependent on their cars, yet having a hard time affording gas — it’s starting to look as if Berlin had the better idea.

And this:

Indeed, the 2008-9 plunge in world trade was one for the record books. What it mainly reflected was the fact that modern trade is dominated by sales of durable manufactured goods — and in the face of severe financial crisis and its attendant uncertainty, both consumers and corporations postponed purchases of anything that wasn’t needed immediately.

If Paul is still working the problem, then how in the hell can Congress figure it out? A few points. The collapse in trade, according to the Baltic Dry, occurred twice, once in late 2007 and finally mid 2008, both times before the severe financial crash. And the BDI collapsed, not because of deregulation but because exporters were watching the reaction of American consumers to high gas prices. Paul got it right before the crash, we are stranded in suburbia, but he then switched gears.