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Krugman’s Intellectual Waterloo


Krugman’s Intellectual Waterloo – Lilburne – Mises Institute.

I think this should put to bed whether or not the Austrian Business Cycle Theory economists were right or not, in Paul Krugman’s own words back in the earlier part of the decade, the Fed should create a housing bubble to pull us out of the Clintonian recession. 

Of course, now Krugman is essentially saying that he didn’t advocate policy.  I suppose his bizarre utterances in the nation’s “paper of record” should’ve been considered a “just kidding” column?  Thankfully, whenever Krugman suggests recommendations, my advice to all y’all is to do the opposite.  Krugman is great in understanding what NOT to do.

 

Paul Krugman is the Nobel winning NY Times economist who is rarely correct, and his recommendation to create a housing bubble is exactly what the Fed did (and is one of the primary factors that helped create the worst recession in decades).  You can blame George Bush If you’d like, but  Alan Greenspan was a Clinton appointee, he preceded Bush, and the President has no power over the Fed Chairman other than to appoint one.   We can blame Bush for Bernanke, a Greenspan clone, but the housing bubble was already well on its way before Bernanke came to town. 

Whether or not the Fed Chairman Alan Greenspan listened to this moron’s advice is unclear, but what we do know is that Greenspan’s policies were congruent with Krugman’s advice.  Meaning, lines of production were directly forced into the housing market by the Fed via low interest rates and flooding banks/financials with printed money; those productions lines infected the entire world, from Dubai to Germany, E. Europe, Iceland, the UK, everywhere housing (both commercial and private) and their mortgages were built and approved all over the planet.

 

To be sure, other players were an essential element to the entire mess, including government regulatory agencies, government legislation (such as the Community Redevelopment Act) and government created mortgage loan guarantors Fannie Mae and Freddie Mac, with a little tightening of energy supplies added to the mix (that being the catalyst that began the foreclosures). 

Paul Krugman is a Keynesian economic theorist, a liberal, and writes for the NY Times, 3 resume bullets that essentially means clueless.

 

Fil “Filvis” Rechnitzer
US Air Force MSgt (Ret)

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