TPMtv Talks to Adam Posen

Adam Posen, deputy director of the Peterson Institute for International Economics, who has studied Japan’s “Lost Decade” of economic growth, sees startling parallels with our current situation — including the anemic initial efforts to bailout the banking system. Posen admits that he was slower than some to anticipate the depth of the current crisis, but now that we’re here he says there’s no good reason to hesitate to follow the Swedish model: wipe out the shareholders of insolvent banks, have the government briefly take them over, and sell off the good assets to new private banks.