Friday, August 26, 2011

The Fed Is Political, redux

. Friday, August 26, 2011

Krugman's on the same page.

I will say that Krugman (and plenty of others from all along the ideological spectrum) are wrong to ridicule people who talk about "debasing the dollar" for not knowing what they're talking about. That's exactly what they (the expansionists eg Krugman) mean when they talk about currency devaluation and/or increased inflation for a sustained period, but they just call it "monetary stimulus". It might be good for the economy in aggregate, but it won't be good for everyone and those political cleavages obviously matter. They often make the case that monetary stimulus would be good in aggregate, but usually without recognizing that there is a group of people that genuinely wouldn't benefit from debasement, and this group is much broader than the "rentier class". It includes every consumer, eg. Ron Paul and Paul Ryan aren't loonies for noticing that, even if they're highly selective in their argument.

It's fine to ridicule Rick Perry as a loony detached from reality though, because no matter what the Fed does w/r/t QE3 it won't be treason and doesn't deserve the Texas special.


The Fed Is Political, redux
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