Piling on Samuelson

Like Tyler, I think Samuelson has not done his homework.

Here is Paul Samuelson:

But financial panic engendered by the burst bubble of unsound U.S. and
foreign mortgage lending means that even a mammoth corporation like
General Electric would find it expensive now to finance a loan needed
to build a new and efficient factory.

Here is Jeffrey Immelt, chairman and chief executive of General Electric:

Q: What’s your opinion of the "credit squeeze" and the view that the US economy may be about to run into difficulties?

A: It’s clear there has been some bad lending behaviour [by banks] in the
US. But in the world as a whole, there is still a lot of liquidity.
Companies generally have strong balance sheets, giving them the ability
to borrow on reasonable terms….If you consider the problems in the credit markets, they will not have
an impact on the vast majority of GE’s business. In other words, the
overall effect on GE will be limited.

Yes, Immelt’s job is to be rosy but profits are strong at GE.  I’d like to see some evidence for Samuelson’s statement. 


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