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-- joining me now our market master of the evening Harvard economist senior fellow of Cato Institute professor Jeffrey -- great to have you with us -- Let's start with Iraq let this -- where these markets.
We are watching volatility I I think it's fair to say -- unprecedented levels.
Three straight triple digit declines.
What do you make of what is happening and these markets as apparently there's considerable focus on Europe.
I think that there's two main things going on on the one hand we have.
European situation where everyone knows there's a lot of debt from countries like Greece Spain Italy.
That is probably not gonna get paid back and fallen so the banks that are holding that are very worried and nobody wants to sort of bailout all that debt that's out there is a huge amount of debt to bail out so that's weighing on the markets both in Europe and in the US of course US banks.
Well partially -- all those European banks so that makes them worried that the US situations battery just had to zero growth -- important employment.
That was announced last Friday and most of the indicators of the state of the economy are pointing negative so.
There's lots to be worried about.
Lots to be worried about and that we have a president who this Thursday before a joint session of congress as you know will proposed job creation.
Now let me ask you -- says.
-- the tremendous economist you are is there any way on God's Green.
Job creation and have it amount to anything.
In time to.
To change the direction.
Of the 2012.
Well I think that.
There's a chance that just the right set -- policies could affect people's view of the status of things could affect.
The change could cause things to go in the right direction.
And that might be enough to change the election.
It certainly there's almost nothing anyone again due to get unemployment down to 7% or anything like that it's going to be quite high going an election.
But if it were coming down if they've -- to eight then -- but of course the question is what are those policies I don't think the policies that Obama will propose on Thursday night.
Are likely to do -- what I think we're received roughly more of the same and I suspect it's gonna be quite an effective at stimulating the economy.
Professor Alan Krueger.
We just heard senator Rand Paul far out another keynesian who was by the way -- author they -- cash for clunkers program.
He's heading up a council of economic advisors what's your reaction.
While -- long time friends and I am for about thirty years and he's a very very excellent economist.
But they're actually right that He is a standard keynesian economist.
He prescribed to the general perspective that's.
Been pursued in Washington for the last three years so I don't think we're -- -- see any radical changes in the thrust of policy it's going to be focused on having.
Big government via.
Fiscal and monetary policy trying to fix things.
My view is that all those things whether they were likely to be effective or not case three years ago at this point.
They're done they just can't possibly do anymore and it's going to be a very different approach that would get the economy going.
In your judgment is this economy going to move forward or re going to contract possibly back into recession.
Well I think there's a pretty good chance that we'll contracted gas and crude will have a double -- I don't think.
That anything that's happened prevents us from returning to a very quickly growing a robust economy.
It's gonna take a few years but most important I think it takes a radical.
-- different approach it takes a view -- as.
The government doesn't hate rich people would doesn't hate businesses it doesn't hate capitalism it recognizes that the jobs are gonna be created mainly by having the private sector have an optimistic view of its relationship with the government.
They will government will stay out for the most part.
I don't see that that's gonna happen in the near future.
-- we can talk about the private sector what are we all talk and I'm talking about of those of us in the media those of you and academia.
Those in government -- we talk about what we really mean we say the private sector.
Most jobs are created small business not big business big business as the big megaphone small business has almost no.
Megaphone we're talking about small business where jobs are created -- that has to be the focus does it not.
Well I think that it's your right small businesses often create a lot of jobs of course small businesses destroy a lot of -- still because small businesses come -- -- What tends to lead to the net job creation is win new businesses thrive and they -- go from being small to be coming days.
But we shouldn't be picking winners and losers with respect to small or large in my view anymore -- we should be picking winners and losers.
With respect to Green energy vs other sorts of -- you would agree we should we had -- do something different because we haven't been creating jobs.
For a very long time in this in this country.
I totally agree with that I'd absolutely -- we need to do something different while we're doing -- through professor somebody could pick a winner here I'd take a winner.
I mean I can't I don't.
When it comes to job creation.
Jeff -- is always it's great to have you with thank you for being.
That's a bear up next --