If Paul Krugman Ran the Fed He'd Be Printing Money Like a Motherf^%*er
I've made my distaste for Paul Krugman known on more than one occasion but let's take a look at his recent NYT op-ed to revisit the bile rising in my throat at the very mention of his name.
Krugman mentions a "a once-unthinkable level of economic distress... in the process of becoming the new normal" but I imagine his reservations to this idea of fiscal responsibility come from his total inability to believe in any solution other than printing endless amounts of money.
Let's go, dumbass:
It’s true that the Fed has already pushed one pedal to the metal: short-term interest rates, its usual policy tool, are near zero. Still, Ben Bernanke, the Fed chairman, has assured us that he has other options, like holding more mortgage-backed securities and promising to keep short-term rates low. And a large body of research suggests that the Fed could boost the economy by committing to an inflation target higher than 2 percent.
But the Fed hasn’t done any of these things. Instead, some officials are defining success down.
For example, last week Richard Fisher, president of the Federal Reserve Bank of Dallas, argued that the Fed bears no responsibility for the economy’s weakness, which he attributed to business uncertainty about future regulations — a view that’s popular in conservative circles, but completely at odds with all the actual evidence. In effect, he responded to the Fed’s failure to achieve one of its two main goals by taking down the goalpost.
He then moved the other goalpost, defining the Fed’s aim not as roughly 2 percent inflation, but rather as that of “keeping inflation extremely low and stable.”
In short, it’s all good. And I predict — having seen this movie before, in Japan — that if and when prices start falling, when below-target inflation becomes deflation, some Fed officials will explain that that’s O.K., too.
What lies down this path? Here’s what I consider all too likely: Two years from now unemployment will still be extremely high, quite possibly higher than it is now. But instead of taking responsibility for fixing the situation, politicians and Fed officials alike will declare that high unemployment is structural, beyond their control. And as I said, over time these excuses may turn into a self-fulfilling prophecy, as the long-term unemployed lose their skills and their connections with the work force, and become unemployable.
I’d like to imagine that public outrage will prevent this outcome. But while Americans are indeed angry, their anger is unfocused. And so I worry that our governing elite, which just isn’t all that into the unemployed, will allow the jobs slump to go on and on and on.
You hear that, America? Krugman says grab the pitchforks and FORCE the Fed to go outside its legal authority by printing lots and lots of money. That's the only solution and unless the Fed gets on that right now, you will never get a job. Disregard the fact that your dollars will be debased in the process, all that matters is getting some in your pocket. And it doesn't matter anyway because we can always print more!
I know what you're thinking: is this guy totally stupid?! Actually he's about as stupid as a fox. Krugman knows from his many years of experience with the esoterica that the average American will not notice his purchasing power being eroded right before his eyes but will certainly notice if he is out of a job for years at a time. Krugman also knows, being an expert in these things, that in order for the debt-based monetary system to survive, deflation is a larger threat than inflation and that if we do not start encouraging a higher rate of inflation, we can pretty much kiss our entire monetary system goodbye. Of course Krugman is incapable of recognizing that a death of this system would benefit the consumer in the end so let's just stick with keeping this thing alive at all costs for as long as possible.
God forbid he lose his job. Of course if that happens I guess he could always go into comedy.
I, of course, looked at Fisher's speech differently and mostly agreed with what he had to say but that's because I am not a manic money-printing psycho like our friend Krugman here. Douche.