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Author: Goofyhoofy Big funky green star, 20000 posts Top Favorite Fools Top Recommended Fools Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 454837  
Subject: Krugman whacks, and waxes Mish Date: 2/3/2013 8:22 AM
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Mish:

Krugman would respond with incomprehensible gibberish "for wonks only" as well as typical Keynesian nonsense about how paying people to dig holes and other people to fill them up would start a chain reaction of growth.

A child would see the answer was preposterous, but not a trained economist, politician, or brainwashed academic. Paul Krugman, keynesian economists in general, politicians wanting a free lunch, and most academics are all incurable.

http://globaleconomicanalysis.blogspot.com/2013/01/how-to-de...

Krugman:

Funny: Angry Bear finds some of the usual suspects explaining How to Debate Paul Krugman, and the answer appears to be this: invent a straw man who bears no resemblance at all to the economist/columnist of the same name, and ridicule that imaginary person.

Aside from the silliness of the exercise, this little exchange is another illustration of a point I’ve noticed before: the way hard-right commentators assume that the other side must be their mirror image. They insist that no government intervention is ever justified; so liberals must support any and all government interventions. They want smaller government, as a principle; liberals must want bigger government, never mind what for. They believe that deficits and printing money are always evil; liberals must be for deficits and money-printing under all circumstances.

http://krugman.blogs.nytimes.com/2013/02/03/despicable-me/

It's simple fact that Mish has wildly mischaracterized Krugman's arguments, then takes them on with a vengeance. Or, as the Professor says:

An hour spent browsing this blog would quickly refute all of this, together with the bizarre charge that I never look at evidence; you may not agree with my conclusions, but I sure do post a lot of numbers. But obviously looking at what I actually write would just be too painful.
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Author: PeterRabit Big funky green star, 20000 posts Top Recommended Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 414966 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 11:39 AM
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"The Conscious of a Liberal"

Who knows what is the original reference for this title?

Peter

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Author: WendyBG Big gold star, 5000 posts Top Favorite Fools Top Recommended Fools Feste Award Winner! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 414969 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 11:48 AM
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METAR rules forbid partisan posts which contrast liberal and conservative positions.

Since this post is political and has no useful financial recommendations, I will FA it.

METARs, especially partisans, please do not respond on this thread.

Wendy

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Author: rubberthinking Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 414970 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 12:18 PM
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Goofy,

Mish has never known anything about economics. He does not even understand anything about econ. Mish is sometimes very good at picking a trend in the markets.

Dave

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Author: rubberthinking Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 414971 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 12:25 PM
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http://en.wikipedia.org/wiki/The_Conscience_of_a_Liberal

The Conscience of a Liberal is a book written by economist Paul Krugman. It was 24th on the New York Times Best Seller list in November 2007.[2] The title was used originally in Senator Paul Wellstone's book of the same name in 2001. Wellstone's title was a response to Barry Goldwater's 1960 book The Conscience of a Conservative.

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Author: steve203 Big funky green star, 20000 posts Top Recommended Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 414973 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 12:31 PM
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Who knows what is the original reference for this title?

Y'all making a MacBeth reference?

Steve...prefers Henry V

http://www.youtube.com/watch?v=DjZWL3bq8gw

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Author: rubberthinking Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 414976 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 12:51 PM
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Steve,

it has been a while since reading MacBeth. I found no reference in that clip. I must have missed it?

Dave

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Author: notehound Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 414977 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 12:55 PM
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Steve...prefers Henry V

"We happy few, we band of brothers..."

Dittos. Shakespeare's Henry V St. Crispin's Day speech embodies the very essence of what it is to be a leader of men. Text at the following link:

http://artofmanliness.com/2008/09/13/manvotional-2-we-few-we...

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Author: salaryguru Big gold star, 5000 posts Top Recommended Fools Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 414978 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 12:56 PM
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METAR rules forbid partisan posts which contrast liberal and conservative positions.

This seems more like a post about rules for rational argument and debate than about politics. The fact that one side is liberal and one side is insane doesn't make the content political. The same point would be made if one side were conservative and the other side were insane.

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Author: rubberthinking Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 414980 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 1:14 PM
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Steve,

now after much deliberation, I realize you are saying Mish leads the French.

I get it....sort of...

Dave

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Author: Dwdonhoff Big gold star, 5000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415008 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/3/2013 11:10 PM
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WOW... look at the dopple recs!!!
Literally unbelievable!

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Author: crassfool Big funky green star, 20000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415013 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/4/2013 1:04 AM
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notehound says

Dittos. Shakespeare's Henry V St. Crispin's Day speech embodies the very essence of what it is to be a leader of men. Text at the following link:

http://artofmanliness.com/2008/09/13/manvotional-2-we-few-we......

"Art of Manliness"? Really?

The St. Crispin's Day speech embodies the very essence of what it is to be a leader of warriors, perhaps.

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Author: notehound Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415017 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/4/2013 7:53 AM
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"Art of Manliness"? Really?

Crassfool,

That's the link where I was able to quickly find the text version of the Shakespeare speech on the same page as the video.

I don't vouch for the title of the site or the non-gender-neutral noun in my post. I must have had 15th Century English culture and language in my subconscious courtesy of Branagh's moving oration.

i.e. - Not intentionally chauvinist. Just insensitive sometimes. Sorry.

:-(

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Author: JoshRandall Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415018 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/4/2013 8:17 AM
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Krugman
=========

Yet another worthless socialist/tyrant who "won" the Nobeliberal Prize for doing nothing of any significance.

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Author: LEDfan Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415025 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/4/2013 10:55 AM
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Where's the celebration? Mish was a Fool product, right? He goaded the Krugman!

time for some balloons!

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Author: rubberthinking Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415027 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/4/2013 11:47 AM
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Yet another worthless socialist/tyrant who "won" the Nobeliberal Prize for doing nothing of any significance.

in other words you did not read his work or works.

Dave

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Author: steve203 Big funky green star, 20000 posts Top Recommended Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415031 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/4/2013 11:59 AM
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...it has been a while since reading MacBeth. I found no reference in that clip. I must have missed it?

Remember when Lady MacBeth went psycho over the murder?

Lady Macbeth, as has become her wont, sleepwalks through the royal castle. As her waiting-woman and her doctor listen in, she mutters fragments of an imaginary conversation that recalls the night she and her husband conspired to murder King Duncan [see A SORRY SIGHT]. The hour is two o'clock; she upbraids her husband for his bad conscience; she insists that there will be nothing to fear once they've grabbed the crown; she marvels at how much blood Duncan had to shed. As Lady Macbeth replays this scene for the eavesdroppers, she not only incriminates herself, but also reveals the pangs of conscience she had ridiculed in her husband.

http://www.enotes.com/shakespeare-quotes/damned-spot

Or Hamlet: "the play is the thing. Wherein I'll catch the conscience of the King"

The clip, of course, was from Henry V.

Steve

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Author: Hawkwin Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415032 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/4/2013 12:01 PM
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Funny: Angry Bear finds some of the usual suspects explaining How to Debate Paul Krugman, and the answer appears to be this: invent a straw man who bears no resemblance at all to the economist/columnist of the same name, and ridicule that imaginary person.

It's simple fact that Mish has wildly mischaracterized Krugman's arguments..

-----------


Actually, he hasn't. Krugman has often cited the debunked "broken window" fallacy of economic growth.

If fact, he used it to defend another useless war.

http://krugman.blogs.nytimes.com/2011/09/03/broken-windows-o...

Thrift leads to lower investment; wage cuts reduce employment; even higher productivity can be a bad thing. And the broken windows fallacy ceases to be a fallacy: something that forces firms to replace capital, even if that something seemingly makes them poorer, can stimulate spending and raise employment.

http://www.huffingtonpost.com/2011/09/28/paul-krugman-spendi...

"What we need is actually the financial equivalent of war," he said during a talk at the 92nd Street Y in Manhattan. "What actually brought the Great Depression to an end was the enormous public spending program otherwise known as World War II."

He said that the wars in Iraq and Afghanistan, though expensive, have not stimulated the economy because in comparison to the country's total output, "this is not big spending." The cost of the wars in Iraq and Afghanistan peaked at just 1.2 percent of GDP, while the Vietnam war was nearly twice as expensive, at 2.3 percent of U.S output, according to Bloomberg.

If we discovered that, you know, space aliens were planning to attack and we needed a massive buildup to counter the space alien threat and really inflation and budget deficits took secondary place to that, this slump would be over in 18 months,"

-------------

Krugman - pro alien attack economist.

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Author: FreethinkerKW Big gold star, 5000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415153 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/6/2013 12:02 AM
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Mish is not a hard-right Commentator. My goodness, man, you don't remember Mish taking BuildMWell to the woodshed early and often on the old Political Asylum board over the imminent invasion of Iraq?

Everything Mish warned would happen in the lead up to the war and the invasion and then the occupation happened. Mish was virulently relentless on his attacks of the Bush/Cheney Administration. BuildMWell was an apologist, going so far as to invoke his wife's chemistry degrees to assure us all that the WMD would be found after we occupied Iraq, that the Iraqis would throw flowers at our feet, that the occupation would be a breeze. Mish tore these assumptions to bits.

Mish and I do not agree politically (he's anti-Union) but he is extremely liberal in certain social issues, especially needless war. During this last election, Mish was for Ron Paul. But he criticized Romney more than Obama. Way more.

Were Krugman to shut his yap and read Mish's blog sometimes, he might learn something about Mish: he's an inconoclast. Not a hard-right commentator.

Krugman continues to lose credibility with his knee jerk criticisms of anybody who takes a different view than his. Calling Mish a hard right commentator shows me the good Professor needs to get out of his ivory tower and really study people he thinks are his enemies. So he's a Professor. If the guy won't read Mish's blog, why should anyone pay attention to a man who cuts himself off from opposing views and made-up opposing views.

I chuckle at Krugmans' accusation of Mish and "hard-right commentator" constructing strawmen. Krugman has done just that thing with this short blog post of his.

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Author: FreethinkerKW Big gold star, 5000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415154 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/6/2013 12:09 AM
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Mish has never known anything about economics. He does not even understand anything about econ. Mish is sometimes very good at picking a trend in the markets.

Dave



Dave, Mish started this very board. His grasp of gold, silver, the Housing and Credit Bubble's, oil, etc. are much deeper than what many on this board display.

He's a weak speaker, but has gotten better. But to say "he has never known anything about economics. He does not even understand anything about econ," is absolutely comical to old timers who've read this board for years.

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Author: PolymerMom Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415160 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/6/2013 4:16 AM
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I find Mish is pretty much a libertarian w/ a social welfare streak. I can get along w/ Mish. But Krugman hasn't been following Mish for the years you and I have. He's quoting from a recent blog post, after all.

"Getting out of the ivory tower" means neglecting what Krugman's being paid to do - as in teaching Econ, writing for his blog, doing whatever faculty has to do, and promoting his new paperback. That's asking a lot of anyone - assuming a person tries to do a decent job at all the above tasks.

Can we be honest and say that the post of Krugman's was based upon what he read at Mish's site was all that he knew of Mish? How could someone who was unaware of the Boards' history understand what Mish has said over the years?

After all, it's hard to be omniscient! I'm sure I've missed a lot<g>.

PM

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Author: rubberthinking Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415166 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/6/2013 8:16 AM
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Dave, Mish started this very board. His grasp of gold, silver, the Housing and Credit Bubble's, oil, etc. are much deeper than what many on this board display.

He's a weak speaker, but has gotten better. But to say "he has never known anything about economics. He does not even understand anything about econ," is absolutely comical to old timers who've read this board for years.


Chainedthinker,

I was here on this board within the first weeks. Where were you? Were you even here within the first two years? And I knew Mish as a poster well a couple of years before he was forced by other fools to leave their boards and start this board. Again Mish was literally forced to start this board. You really think Mish is a weak speaker? What in a class room setting where people can retort in person? Or on these boards? Comical? You definitely are being comical.

Mish is basically spouting the Austrian School of economics. So Mish misses the boat on literally everything having to do with economics.

Krugman is totally right, Mish is a conservative on economics out of the Austrian School. Before you post Freethinker at least know what you are posting about.

You are being offensive without having a single clue.

We have never come to this level of discourse before between us, but you wanted it. Hopefully you can apologize for being wrong about Krugman's ideas on Mish, and we can get back to a peaceful coexistence.

We all seemingly need to live and learn. At this point I hope I have opened your eyes for you.

Dave

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Author: Goofyhoofy Big funky green star, 20000 posts Top Favorite Fools Top Recommended Fools Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415169 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/6/2013 8:50 AM
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Everything Mish warned would happen in the lead up to the war and the invasion and then the occupation happened. Mish was virulently relentless on his attacks of the Bush/Cheney Administration. BuildMWell was an apologist, going so far as to invoke his wife's chemistry degrees to assure us all that the WMD would be found after we occupied Iraq, that the Iraqis would throw flowers at our feet, that the occupation would be a breeze. Mish tore these assumptions to bits.

I don't think anyone is talking abut Mish's "politics." The issue is his "economics", which are certainly hard right. Anti Fed. Libertarian. The government is always an idiot.

Krugman continues to lose credibility with his knee jerk criticisms of anybody who takes a different view than his.

No, he points out that everywhere Mish's prescription has been tried it has been a failure. Every.Single.Time. And yet, like the Zombies-from-Planet-X, the tune never changes.

Which countries have GDP higher than where they were in 2007? The U.S. Australia. Japan. China. Canada. Which don't? England. France. Ireland. Iceland. Italy. Greece. Spain. Portugal.

Which countries engaged in government stimulus? The U.S. Australia. Japan. China. Canada. Which followed austerity and "hands off" prescriptions? England. France. Ireland. Iceland. Italy. Greece. Spain. Portugal.

You'd think somebody like Mish would notice. You too, maybe.

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Author: notehound Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415206 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/6/2013 12:39 PM
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Which countries engaged in government stimulus?

Goofy,

While I acknowledge that the "austerity" approach promulgated in Europe has been accompanied by a different result than those countries you list as engaging in stimulus, it seems to me that the different results are more caused by the Euro currency's particular problems than by a failure to engage in stimulus.

After all, Europe has done precisely the same sort of stimulus that every country on your list has done - that is stimulus in the form of protecting (bailing out) the banks, without allowing that stimulus to leak out into the hands of ordinary people (except to the extent of "low interest mortgages" - which are merely another form of bank support).

In every instance, the benefits of stimulus have been privatized while the costs have been socialized. That's true of every country on your list - those which are "recovering" and those which are not (possibly excepting Iceland).

Trying to impose the same Euro currency and borrowing/lending policies on very different sorts of cultures and economies leads to tremendous dislocations and suffering. That is the source of Europe's difficulties - and the reason for its enforced "austerity" on those countries that should have defaulted and gone bankrupt long ago.

In other words, I consider bank bailouts, balance sheet padding, bondholder protection, bankruptcy prevention and currency manipulation to be more the source of the contrasts you describe than the simple application of "stimulus" vs. non stimulus.

The world is being operated as a bankocracy. Whether or not the bankers running any particular part of the world require a pound of flesh from the people is more determinative of local outcomes than any other factor or philosophy.

http://en.wikipedia.org/wiki/Bankocracy

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Author: rubberthinking Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415210 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/6/2013 12:50 PM
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In other words, I consider bank bailouts, balance sheet padding, bondholder protection, bankruptcy prevention and currency manipulation to be more the source of the contrasts you describe than the simple application of "stimulus" vs. non stimulus.


Notehound,

granted it is not simple.

All on that list and all in the public sector and the general public are intertwined. They are not really all that separable.

The EU outside of France has erred on the side of less stimulus. The wealthy see this as their chance to escape the people in favor of themselves. The wealthy want a Reagan Revolution in the EU.

It will work later in the cycle. For a while it will work. But mainly for those you think dont deserve the free lunch, the bankers.

We have not heard back yet from DaveD the loan originator on how this could be worked out differently with less suffering in the future for the Greeks. His silence is a little conspicuous.

Dave

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Author: Hawkwin Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415232 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/6/2013 3:54 PM
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No, he points out that everywhere Mish's prescription has been tried it has been a failure. Every.Single.Time. And yet, like the Zombies-from-Planet-X, the tune never changes.

Typical logical fallacy to attack the author based on their previous comments when in fact, such an attack does not deminish the fact that Mish is correct; that Krugman has claimed on more than one occasion that we could spend our way to a better economy by having another pointless war.


I am no fan if Mish. In fact, I still have him on ignore from when he used to post here - but my dislike of Mish doesn't mean that what is stating about Krugman is any less true.

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Author: Goofyhoofy Big funky green star, 20000 posts Top Favorite Fools Top Recommended Fools Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415339 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/7/2013 4:10 PM
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Typical logical fallacy to attack the author based on their previous comments when in fact, such an attack does not deminish the fact that Mish is correct; that Krugman has claimed on more than one occasion that we could spend our way to a better economy by having another pointless war.

Except that it's true. Having "another pointless war" would, in the short run, increase employment as the government would send out massive orders for tanks, aircraft, munitions, spycraft, jeeps, guns, missiles, and all the rest.

It always does. Ask Adolph, who brought Germany back from the nadir by engaging in a pointless war across Europe in the 1930's. Or FDR, whose war was arguably less pointless in the 1940's. Or the Japanese, who created (then lost) and empire in the early 20th century.

Heck, Reagan had a booming economy thanks to ... (wait for it) massive deficit spending on the military. Now please note that neither Krugman or I think this is a good use of the money, but that does not change the outcome. I just happen to think we would have a better outcome if we spent all that dough on efficiencies: highways, electrical grid, building out a universal broadband network, and so on. Those are the gifts that keep on giving, unlike "military", which is one-and-done. But a job is a job, in the short run, and that's good.

but my dislike of Mish doesn't mean that what is stating about Krugman is any less true.

I agree whether you like Mish or not doesn't make his statements any more or less true. What makes them less true is history. Wars are good for business. They always have been, and that's one reason we have so many of them. It's also true that the austerity attempts since 2007 have been failures every single time, and that the countries which did not follow that folly have been successful at avoiding the worst of the catastrophe. Every single time. However I also acknowledge that it's like religion to some people, and the marshaling of facts, even gigantic piles of them, even gigantic piles of them over years of experience - does not dissuade people from believing in their particular fairy tale.

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Author: Hawkwin Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415342 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/7/2013 4:29 PM
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Except that it's true. Having "another pointless war" would, in the short run, increase employment as the government would send out massive orders for tanks, aircraft, munitions, spycraft, jeeps, guns, missiles, and all the rest.

Now please note that neither Krugman or I think this is a good use of the money,

I don't see any demonstration of that from Krugman. As I linked previously, he has on more than one occasion defended useless war spending as economic stimulus. Not necessary war spending as might have been the case with WW2 but actual useless war spending.

But a job is a job, in the short run, and that's good.

No, it is never than simplistic. As much as we might disagree on various topics, I've always respected your intellect but am rather shocked you actually believe that a useless job is the same as a productive one.

I don't imagine you would use that same defense to argue in favor of higher CEO pay would you? If all jobs are basically equal regardless of their output, then how can anyone argue against high CEO pay - even if they don't necessarily add productive value?

http://en.wikipedia.org/wiki/Parable_of_the_broken_window

The parable of the broken window was introduced by Frédéric Bastiat in his 1850 essay Ce qu'on voit et ce qu'on ne voit pas (That Which Is Seen and That Which Is Unseen) to illustrate why destruction, and the money spent to recover from destruction, is actually not a net-benefit to society. The parable, also known as the broken window fallacy or glazier's fallacy, demonstrates how opportunity costs, as well as the law of unintended consequences, affect economic activity in ways that are "unseen" or ignored.

...

"Society loses the value of things which are uselessly destroyed;" and we must assent to a maxim which will make the hair of protectionists stand on end – To break, to spoil, to waste, is not to encourage national labour; or, more briefly, "destruction is not profit."

The argument can be made that war is a benefactor, since historically it often has focused the use of resources and triggered advances in technology and other areas while reducing unemployment. The increased production and employment associated with war often leads some to claim that "war is good for the economy." However, this belief is often given as an example of the broken window fallacy. The money spent on the war effort, for example, is money that cannot be spent on food, clothing, health care, consumer electronics or other areas. The stimulus felt in one sector of the economy comes at a direct – but hidden –cost to other sectors.

...

In addition, war destroys property and lives. The economic stimulus to one nation's defense sector is offset not only by immediate opportunity costs, but also by the costs of the damage and devastation of war to the country it attacks. This forms the basis of a second application of the broken window fallacy: rebuilding what war destroys stimulates the economy, particularly the construction sector. However, immense resources are spent merely to restore pre-war conditions. After a war, there is only a rebuilt city. Without a war, there are opportunities for the same resources to be applied to more fruitful purposes. Instead of rebuilding a destroyed city, the resources could have been used to improve and enlarge the city or build a second one.

-------

I don't know how anyone (especially you) can logically support the position of the broken window economic stimulus - especially when arguing in favor of an admittedly useless war.

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Author: mauser96 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415344 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/7/2013 4:51 PM
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If pointless wars could forever invigorate the economy the Roman Empire would still be here.


No doubt wars are good for the economy. In the short run. If you win them (ask Germany and Japan how WW2 helped them). And if you aren't one of the ones that are killed.
We don't need a war. Just hire people to dig holes, hire other people to fill them up. Economically productive government spending would be a lot better idea, but I have seen little or no evidence that either political party can do this. They are interested in vote buying, not productivity.

Wasteful government spending leads to debt growing faster than the economy, and Reinhart and Rogoff give multiple examples of the bad results from that.

As goofy points out there are a number of areas where government spending might prove helpful to this country in the long run. But that's not where most of the money will go, and what does go there will be mostly wasted.

It will go to things like non competitive solar plants and luxury electric cars that will be built outside the US.

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Author: notehound Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415347 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/7/2013 5:43 PM
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Economically productive government spending would be a lot better idea, but I have seen little or no evidence that either political party can do this. They are interested in vote buying, not productivity...
As goofy points out there are a number of areas where government spending might prove helpful to this country in the long run. But that's not where most of the money will go, and what does go there will be mostly wasted.


Mauser,

I hope no one thinks that yours is a verboten political post, since every word of it is accurate and unbiased.

Rec.

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Author: rubberthinking Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415367 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/8/2013 12:55 AM
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Economically productive government spending would be a lot better idea, but I have seen little or no evidence that either political party can do this. They are interested in vote buying, not productivity...



For all the fireworks and the we wont vote for that tax hike in DC, well both parties seemed to be on the same page when it came to the American Taxpayer Relief Act. Which is for increasing productivity out of middling to small businesses as opposed to having this millionaires invest in hedge funds. I think the times are changing.

Dave....the optimist.....

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Author: brucedoe Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415488 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/9/2013 4:15 PM
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FreeThnker

As I have posted before, I fully expected runaway inflation before the end of 2001 and in my heart have been expecting it ever since. But my rational selp became convinced by Krugman's case that we are in a "liquidity crisis," and no one knows how to get out of it. So I bought 5 yr and 7 yr CDs paying 5-6.5% with my emotional self fully expecting CDs to rise to 8% and maybe more by the end of the year. But interest rates have fallen to ridiculously low levels since and those CDs are maturing. That is how long this situation has been going on.

My thought is that once deleveraging is over, then interest rates will rise. Though state and local government are probably near their lows of RIFing people, the Federal government may be ready to increase their efforts (though some of this has been going on for quite awhile).

So I don't know how long these low interest rates will continue. It could be a long time. The Long Bond (30 yr) has risen above 3% now and stayed there for a couple of weeks, but after the 10 yr Treasury peeked above 2% for awhile, dropped back down below it this last week.

So make fun of Krugman if it does something for you, but he did me a lot of good. In addition I might point out that his dismissal of the dream that austerity would stimulate industry in Great Britain has also proved to be right on as they now seem to be facing another recession if they are not already in it. Note: I am not saying that some austrity might not be worth the economic consequences, just that it is going to make business ready to spend a lot is, well, not realistic.

brucedoe

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Author: jakalant Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415526 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/10/2013 1:27 PM
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I don't know how anyone (especially you) can logically support the position of the broken window economic stimulus - especially when arguing in favor of an admittedly useless war

Seems like you are doing the precise thing Krugman cited in his response, i.e. creating a straw man that has nothing to do with the person and arguing against it.

Here's his point: Increasing military spending will improve the economy.
Do you read from that that he supports useless war?

How about this:
I say: scalding water will burn your hand.
Do you read from that I am in favor of everyone going out and burning their hands?

You are missing the point in large. There are numerous links returned to the search of "Krugman military spending" which return quotes which explain his position, which has nothing to do with him favoring useless wars.

On another point, Krugman has not been wrong on anything since the 90s.

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Author: Hawkwin Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415587 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/11/2013 9:35 AM
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Seems like you are doing the precise thing Krugman cited in his response, i.e. creating a straw man that has nothing to do with the person and arguing against it.

No, read Krugman's own comments. I quoted him in context. From above:

If we discovered that space aliens were planning to attack and we needed a massive buildup to counter the space alien threat and really inflation and budget deficits took secondary place to that, this slump would be over in 18 months. And then if we discovered, oops, we made a mistake, there aren't any aliens, we'd be better –


By Krugman's own words, we made a mistake (a useless war).

So if we simply invaded another country in the search of WMDs, we would get our economy growing again.


On another point, Krugman has not been wrong on anything since the 90s.

LOL!

While your opinion of his track record is not really relevant to the topic, I will share two of my favorite Krugman commentaries.

http://www.huffingtonpost.com/2009/02/17/paul-krugman-stimul...

As for unemployment, Krugman is predicting it will peak around 9% sometime later this year.

Probably my favorite, next to the alien attacks, and it relates to this topic. Krugman finds the "silver linings" to the 9/11 attacks:
http://www.nytimes.com/2001/09/14/opinion/reckonings-after-t...

Nonetheless, we must ask about the economic aftershocks from Tuesday's horror.

These aftershocks need not be major. Ghastly as it may seem to say this, the terror attack -- like the original day of infamy, which brought an end to the Great Depression -- could even do some economic good.
...
So the direct economic impact of the attacks will probably not be that bad. And there will, potentially, be two favorable effects.

First, the driving force behind the economic slowdown has been a plunge in business investment. Now, all of a sudden, we need some new office buildings. As I've already indicated, the destruction isn't big compared with the economy, but rebuilding will generate at least some increase in business spending.

-------

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Author: jakalant Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 415611 of 454837
Subject: Re: Krugman whacks, and waxes Mish Date: 2/11/2013 1:02 PM
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Like I said, if you expose your hand to scalding water you will burn your hand.

If I say: If a massive asteroid hits the earth all life forms except
cockroaches will be extinquished.

Do you think I am in favor of a massive asteroid hitting the earth? For the sake of the cockroaches?

Is that a silver lining in my argument.

How about this. "6 million dies in the ovens in WWII, but my uncle survived." Do you think based on this that I supported the holocaust?

You continue to miss the point in LARGE.

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