Thursday, April 4, 2013

Borrowing and Spending: The Way to Wealth

Hey, big spenders! It's Paul Krugman to the rescue! In the aftermath of David Stockman's recent New York Times article, Krugman is assuring his faithful readers that the massive debt financing of the Obama administration's spending spree is no big deal and that it is not real debt at all, figuratively speaking.

Why? According to Krugman: "...debt does not directly impoverish us, because it’s money we owe to ourselves."

What does he mean by that?
...think about the macroeconomics; did America really put itself $30 trillion in hock to someone else? No, some Americans lent to other Americans, which is a very different issue.

In other words, it essentially is free money, and the government can engage in this financial trick indefinitely without there being any negative consequences. Essentially, what Krugman is saying is that internal bond finance (mostly by the Federal Reserve System) essentially gets rid of the Law of Scarcity. Government, through money printing and issuance of bonds, is an unlimited fountain of wealth creation, and if there is inflation with all this, all the better, according to Krugman, because inflation will help U.S. exports, creating jobs and making us wealthier. (That is Krugman's Inflation Fairy at work.)

(Gee, I wish whoever is holding my mortgage would buy into this: I don't have to repay you! Don't you see, WE OWE IT TO OURSELVES!! Any harm that would accrue by my default would be perfectly internalized into a zero-sum outcome. I gain, you lose, America is not harmed at all!)

Understand that Krugman is the most decorated academic economist of our time. His face is all over the talk shows, and he is treated with the kind of reverence in academe once reserved for someone like Einstein. Yet, his central message is this: internal bond finance of government trumps scarcity. Yes, the guy actually believes this, or at least one can say he provides the Obama administration with cover for its destructive policies.

Remember, Obama declared that unemployment payments from the government create more wealth than does an oil pipeline, and that a welfare system actually makes the economy stronger and is not an economic burden, but a provider of wealth. Yes, for all of the supposed sophistication of American Progressives (and especially the ones that worship Krugman and Obama), it seems that in the end they confuse financial trickery with wealth creation.

72 comments:

Anonymous said...

Well Peter Schiff gets to be on TV all the time and talks over the CNBC and FOX Business personalities all the time and you're trying to paint Krugman as this economist that gets all this undeserved praise? Peter even talked over Lauren Lyster with his typically dogmatic attitude! You Austrian hacks and apostles of Ron Paul are so funny.

You know what they say, a broken clock is right twice a day!

Anonymous said...

Every time Schiff is on TV, he acts like the typical bearer of gloom and doom that he is. He never adjusts his "predictions" and still believes hyperinflation can happen in the US while talking over anyone that disagrees with him. Krugman and Steve Keen are far more polite than Schiff will ever be so that's why they have gotten so far with their message. I heard that Schiff even called Mike Norman a "fucking bastard" some time ago.

http://mikenormaneconomics.blogspot.com/2010/11/schiff-goes-berserk.html

Mike said...

While I don't defend incivility, there are limits tha any human being can suffer respects stupidity. Stupidity itself is one thing, but stupity by pwople that have influence on policy that ultimately brings an economy to its knees is another.

The arguement "we owe it to ourselves" is a sophmoric shallow rationale that is repeated to the masses and is a lie.

KSB said...

"Gee, I wish whoever is holding my mortgage would buy into this: I don't have to repay you! Don't you see, WE OWE IT TO OURSELVES!!"

I wish I could use that logic on the IRS. Why can't I just cut that check every April 15th to myself since I owe that debt to myself.

William L. Anderson said...

"I heard that Schiff even called Mike Norman a "fucking bastard" some time ago."

You heard. From someone in the room? From an authority figure? I'm sorry, but your comments are not going to be taken seriously on this blog.

And I am sure that Krugman always is charitable in private to those who oppose him.

Mule Rider said...

"Krugman and Steve Keen are far more polite than Schiff will ever be..."

Patently false. You don't have to spend more than two minutes reading Krugman's blog and op-ed pieces to see that he holds nothing but indignation and contempt for those who dare hold a skeptical or contrary position to his dogma. His incessant snark, name-calling ("mouth-breathers," "zombies," etc.), and condescension are the furthest thing from "polite."

Mule Rider said...

"I heard that Schiff even called Mike Norman a "fucking bastard" some time ago."

The truth hurts, I guess.

Anonymous said...

That is why I linked to Norman's blog post. He said it himself, not me.

Mule Rider said...

I don't need course language to recognize that Mike Norman is an unhinged, mentally unstable nutcase devoid of any critical thinking skills or understanding of fundamental economic concepts. Anyone referencing him or his work as an authority is immediately and thoroughly discredited.

Robbie said...

Of course, the problem with Schiff is that he wants us to believe that by stockpiling gold we can preserve wealth. isn't this just another one of those funny malinvestments thats always getting us in trouble?

Mule Rider said...

"...isn't this just another one of those funny malinvestments thats always getting us in trouble?"


While there are certainly a select few investors/speculators who try and use gold for short-term gains, it's primary utility is as a store of value, NOT as an investment. Hence your criticism is a bit misguided.

Anonymous said...

From Bogart:
First, owed to ourselves or not, debt contracts entered into by politicians are theft as are the monies created out of a computer to pay for these debts. I wonder if Krugman's parents ever told him: "Two wrongs don't make a right."

But moreover, the debts are not entirely owed to ourselves. At least 25% of this debt is paid to foreigners to the tune of the GDP of the State of Utah. So everyone in Utah your output goes directly to the central banks of China and Japan.

Bob Roddis said...

As I have been saying for some time:

1. No Keynesian in the galaxy seems to have any familiarity with even basic Austrian concepts and/or analysis, including Krugman, DeLong, Mike Norman, Lord Keynes and/or their vast horde of sycophants.

2. No. 1 is substantial evidence that the Austrians have won the debate in a rout. The opponents are afraid that if they were to fairly state the actual Austrian analysis that they would then be speechless due to the self-evident Austrian truth.

Anonymous said...

Bob, that gives Schiff the right to act the way he wants on television and for him to get a free pass from your camp?

Mule Rider said...

"Bob, that gives Schiff the right to act the way he wants on television and for him to get a free pass from your camp?"

As far as I'm concerned, Schiff is allowed to carry a little bit of a chip on his shoulder after the way he was mercilessly and scornfully mocked back in 2006-2007 when he very politely shared what turned out to be some rather prescient warnings.

Lord Keynes said...

" No Keynesian in the galaxy seems to have any familiarity with even basic Austrian concept"

lol.. You mean like flexible prices (including wages) converging towards their market-clearing values as a way of equating supply with demand?

Every mainstream economist understands this concept, its part and parcel of Walrasian GE theory.

Except Bob roddis -- who apparently say it's NOT part of Austrian economics.

Bob roddis -- ignorant of basic Austrian concepts.

Bob Roddis said...

Anyone with 3 hours to waste can follow the amazing results of LK's brilliant mind and argumentation on the same topic as his latest rant here:

http://consultingbyrpm.com/blog/2012/11/econ-101-works-price-controls-cause-gas-lines.html#comment-49192

William L. Anderson said...

Hayek was influenced by Walrasian GE theory, no doubt about it, and so were Wieser and Kirzner. Mises was not a GE practitioner, and if one reads Menger, a GE framework is not necessary to understand what is happening in an economic system.

LK wants us to believe that even if it is in the best interests of people to pursue gains from trade, they won't do it unless the government pulls a financial trick and inflates the supply of money. Otherwise, deflation will set in and the economy will spiral down into Neverland.

Bob Roddis said...

My mistake was that many many months ago in responded to an LK comment after I had spent about 13 seconds thinking about it and shot off a comment stating that the Hayek quote on page 7 here:

http://www.flickr.com/photos/bob_roddis/7534880182/sizes/l/in/set-72157630494776170/

had "nothing to do with" Walrasian GE theory. What I should have said was that what Hayek was explaining was quite different than Walrasian GE theory. Hayek is discussing a structure of prices that is not allowed to come into existence and thus cannot be measured.

Having no real life that we can discern, LK insists at least bi-weekly that they are the same thing. And that I'm therefore an idiot.

Bob Roddis said...

Typo. This should have read:

many many months ago I responded to an LK comment

Lord Keynes said...

"What I should have said was that what Hayek was explaining was quite different than Walrasian GE theory. Hayek is discussing a structure of prices that is not allowed to come into existence and thus cannot be measured. "

It is not "quite different": it is the same fundamental idea, proving once again your ignorance and stupidity.

----

William L. Anderson@April 4, 2013 at 9:44 PM

I'm well aware Mises "was not a GE practitioner".

But Mises's notion of market coordination is by flexible prices moving towards their market clearing levels.

E.g., Salerno, Joseph T. 1993. “Mises and Hayek Dehomogenized,” Review of Austrian Economics 6.2: 113–146, p. 124:

“Mises conceives the market process as coordinative, ‘the essence of coordination of all elements of supply and demand.’ This means that the structure of realized (disequilibrium) prices, which continually emerges in the course of the market process and whose elements are employed for monetary calculation, performs the indispensable function of clearing all markets and, in the process, coordinating the productive employments and combinations of all resources with one another and with the anticipated preferences of consumers.”

You're telling us that no "Keynesian in the galaxy seems to have any familiarity" with that concept?? lol.

William L. Anderson said...

Keynesians believe that prices coordinate economic activity ONLY if the market is in perfect competition as defined by the firm having a horizontal demand curve. Anything else means the market is "manipulated" with "administered prices."

While they may be familiar with the concept, I never have met a Keynesian who actually understands it. Furthermore, Keynesians continue to believe that government operates with perfect information and is omniscient, given it knows exactly how to target spending in order to promote full employment.

Bob Roddis said...

Yes. I'm saying that no "Keynesian in the galaxy" seems to have any familiarity with this concept:

These discrepancies of demand and supply in different industries, discrepancies between the distribution of demand and the allocation of the factors of production, are in the last analysis due to some distortion in the price system that has directed resources to false uses. It can be corrected only by making sure, first, that prices achieve what, somewhat misleadingly, we call an equilibrium structure, and second, that labor is reallocated according to these new prices. ****

The primary cause of the appearance of extensive unemployment, however, is a deviation of the actual structure of prices and wages from its equilibrium structure. Remember, please: that is the crucial concept. The point I want to make is that this equilibrium structure of prices is something which we cannot know beforehand because the only way to discover it is to give the market free play; by definition, therefore, the divergence of actual prices from the equilibrium structure is something that can never be statistically measured. ****

In contrast, the modern fashion demands that a theoretical assertion which cannot be statistically tested must not be taken seriously and has to be discarded. As a result of this belief, a theory which, in my opinion, is the true explanation has been discarded as not adequately confirmed, and a false theory has been generally accepted merely because it happens to be the only one for which statistical evidence, even though very inadequate evidence, is available.”


That is why they always attack Austrians for allegedly avoiding data. As always, you are dishonest and desperate, LK.

Lord Keynes said...

While they may be familiar with the concept, I never have met a Keynesian who actually understands it.

Even if you believe your nonsense claim ("I never have met a Keynesian who actually understands it") that requires that roddis's breathtakingly sweeping assertion ("No Keynesian in the galaxy seems to have any familiarity with even basic Austrian concept") is wrong.

Lord Keynes said...

"The primary cause of the appearance of extensive unemployment, however, is a deviation of the actual structure of prices and wages from its equilibrium structure. Remember, please: that is the crucial concept."

Hayek must mean a market-clearing "equilibrium structure" here, since he trying to explain the existence of unemployment.

Roddis seems to have no familiarity with basic Austrian concepts.

Bob Roddis said...

The other point I constantly make and that naturally escapes LK is that prices in ALL MARKETS tend towards market clearing prices all of the time. The distorted prices obtaining during a 10 year funny money housing boom also tend towards market clearing prices during the entire length of the boom (and those prices are not the “equilibrium prices” from the Hayek quote). But that is not the unique Austrian insight which is describing the distortion of prices by funny money loans etc. that draw investment into unsustainable lines of production and unsustainable asset prices. Even once the bust begins, prices will still tend toward market clearing prices, which means significant deflation and a collapse in asset prices, which the Keynesians try to prevent. So, yes, other schools understand that prices tend towards market clearing prices but do not understand the unique Austrian analysis.

Thus, I say yes, “no Keynesian in the galaxy” seems to understand Austrian analysis.

Bob Roddis said...

From the Dept. of even more fun.

LK accusing Mises of not understanding genetic evolution based upon a Mises quote about the evolution of attitudes.

http://mikenormaneconomics.blogspot.com/2013/04/lord-keynes-mises-flunks-evolution-101.html

Remember this the next time LK calls you an idiot.

Lord Keynes said...

"The other point I constantly make and that naturally escapes LK is that prices in ALL MARKETS tend towards market clearing prices all of the time."

Absolute final proof of your epic ignorance.

Let a fellow Austrian instruct you:

“Those who glibly speak of ‘market clearing prices’ tend to forget that over wide areas of modern markets it is not with this purpose in mind that prices are set. They seem unaware of the important insights into the process of price formation, an Austrian responsibility, of which they deprive themselves by clinging to a level of abstraction so high that on it most of what matters in the real world vanishes from sight.” (Lachmann, L. M. 1986. The Market as an Economic Process. Basil Blackwell. Oxford. p. 134).

Bob roddis -- ignorant of Austrian economics and the REAL WORLD to boot.

Bob Roddis said...

I don't tend to speak of "market clearing prices". You do. It is so self evident that it is pointless to argue about it.

I say is that people attempting to engage in a voluntary exchange will tend to do so so that the end result is a "market clearing price". And I still say all markets TEND (in 5 minutes or in 5 years) towards market clearing prices because that is the goal of people trying to sell stuff.

And I still say that while it is an assumption of the Austrian School, it is not the central point unique to the analysis.

I've said the same thing over and over and you will continue to distort and distort because that is all you have left.

Cato said...

"...debt does not directly impoverish us, because it’s money we owe to ourselves."

American lives are fungible.

William L. Anderson said...

LK assumes:

1. Lachmann speaks absolutely for all in the Austrian School;

2. All Austrians are supposed to accept everything Lachmann as being perfectly representative of Austrian Economics.

There are disagreements among Austrians. The Misesians hold views that differ from those of the Hayekians, and so on.

We have to get at the heart of the matter. LK and the Keynesians claim:

1. The boom is always a good thing and a boom always can be sustained (once it runs aground) simply by more government spending.

2. After the government spends for a while, markets recover and the boom then gains "traction" and moves along.

3. There is no need for any adjustment period because all that is needed is a boost in government spending.

4. Private markets cannot sustain a boom on their own and they are susceptible to the Liquidity Trap.

5. Anyone who believes that the boom should not be pushed by government spending believes so because that person wants to see other people suffer.

6. Consumption actually is a form of production because the economy is a circular entity in which workers "buy back" the products they create. If they cannot "buy back" the products because the capitalists steal their money or the capitalists reduce "aggregate demand" through their propensity to save some of their income, then we have a recession.

7. The way to end the recession is to jack up "aggregate demand" through borrowing and new spending and, where possible, through the printing of new money.

8. Anyone who does not believe the above is evil because that person enjoys watching other human beings suffer through unemployment.

Anonymous said...

Krugman always harps on the failure of Austrians to "get it right," meaning to predict what will happen. His prime example is inflation.

Could someone please address this issue?

This is an honest question from a beginner trying to understand the issues.

Mule Rider said...

"Could someone please address this issue?"

More established men in the field can probably answer this better than I, but the crux of the argument is that most Austrians have been warning for several years now that the growing debt burden and loose monetary policy paths followed by our US Government and Federal Reserve will inevitably devalue the US dollar and lead to inflation, either through unsustainable increases (a bubble) in asset/equity prices, through higher prices for everyday goods and services, or possibly (likely?) both.

The evidence for the latter is scant (at this point, at least), but it's pretty clear the former is happening, to those who are paying attention.

What Krugman and his ilk decry as being "wrong" on the Austrian side focuses squarely on predictions of rapid increases in prices for everyday goods and services. Admittedly, while some Austrians have been rather circumspect in their projections, realizing inflation is an inevitable consequence but not easily observed the way people expect to observe it or on a convenient timeline, others have been more dogmatic and specific in detailing just how much (and what kind) of inflation they expect and when.

That some of those predictions haven't come to fruition, Krugman (and others like him) use as their sole justification to discredit the dire warnings put forth. But his ideological blindness keeps the neo-Krugmanites from acknowledging the predictions will inevitably come true and the negative ramifications in the interim (currency debasement, asset bubbles, etc.) before it becomes abundantly clear what's happening.

Anonymous said...

Mule Rider:

Thank you. That is helpful.

But, in a nutshell, what reason would an Austrian give for why we are not seeing ordinary inflation, given the massive money-printing that's been going on for several years now?

As a novice at economics, I find this very hard to understand.

Bob Roddis said...

Have you checked the price of gasoline and food lately? Under the former CPI methods, we probably are in a 70s style inflation period and all without people being able to borrow money or get equity loans from the now non-existent "equity" in their homes. At the same time, most of the "inflation" is being channeled into asset bubbles and the stock market. Just artificially keeping asset prices from falling to their natural LOWER rates should be seen as inflation.

Because no Keynesian in the galaxy understands the Austrian analysis, they hit upon the alleged lack of allegedly predicted CPI inflation and announce that the analysis (which they meticulously refuse to comprehend) is wrong wrong wrong.

Mule Rider said...

"But, in a nutshell, what reason would an Austrian give for why we are not seeing ordinary inflation, given the massive money-printing that's been going on for several years now?"

Arguably, we're seeing more inflation than the Keynesian crowd wants to admit. Looking at the headline CPI, which INCLUDES those vital food and energy prices (which they try and dismiss in the core CPI - which tends to be lower than headline - because of "volatility" but they still very much "count" in that they represent basic needs), and prices for everyday goods and services in this country are up a little more than 50% since 1995. While far from "hyper-inflation," that's pretty stiff for a big portion of the country sitting on stagnant real wages. Plus, it doesn't even take into account alleged malfeasance in how the government calculates the CPI, which I won't wade into at this time. Guys like John Williams at shadowstats.com tackle that kind of stuff in-depth, and while I think they make very good points and that actual inflation is probably under-stated, there is a counter-argument whereby necessary changes in the basket of goods and services used to calculate CPI (as well as factoring in "hedonic regression") make the current approach defensible.


"As a novice at economics, I find this very hard to understand."

The economy is very complex, and huge swings, either down or up, are hard to project. Dr. Anderson can probably give you a better answer, but my best advice is to pay close attention to how this affects the purchasing power of the dollar rather than what the quoted price of things actually are. That's more important in the long run. But, yeah, for whatever reason, right now, the only "inflation" we're seeing is in stocks, bonds, farmland, and maybe a few other things. There'll be a time that money flows into other unsustainable sources which will result in markedly higher prices for everyday goods and services.

Anonymous said...

"Have you checked the price of gasoline and food lately? Under the former CPI methods, we probably are in a 70s style inflation period and all without people being able to borrow money or get equity loans from the now non-existent "equity" in their homes. At the same time, most of the "inflation" is being channeled into asset bubbles and the stock market. Just artificially keeping asset prices from falling to their natural LOWER rates should be seen as inflation."

Supply and demand much? What's with this conspiracy theory that you and Mark Thornton, and Peter Schiff are trying to peddle?

Mike said...

Mule, the current CPI system is simple not defendable. As John Williams points out, it used to appropriately measure a "constant standard of living" now it allegedly measures a "standard of living" as defined by the government. Very different things. Hedonic regression, substitution and geometric weighting are all manipulation tools. The CPI as well as unemployment and GDP statistics etal are political numbers not economic numbers.

Anonymous @ 2:27. You comment on things you don't understand.

Lord Keynes said...

"Consumption actually is a form of production because the economy is a circular entity in which workers "buy back" the products they create."

That is the essence of what the strong form of Say's law assumes, and Say's law does not work without the concept of aggregate demand being both meaningful and correct.

Presumably, Anderson will now announce that Say's law is actually an evil plot by Keynesians.

Mule Rider said...

"...Say's law does not work without the concept of aggregate demand being both meaningful and correct.

...Say's law is actually an evil plot by Keynesians."

More like "aggregate demand" is an evil red herring from the Keynesian crowd.

Mule Rider said...

"Mule, the current CPI system is simple not defendable."

I lean more in that direction (that CPI and other government numbers are more political and economic and tend to distort) than my comment above may have suggested; I just wanted to somewhat fairly try and present the fact there were two sides of the argument to the curious novice.

Inflation is most assuredly more of a problem than even the headline CPI picks up, although it might not be quite as bad as what Williams/ShaadowStats and some of the others are batting around.

As I said above, even assuming headline CPI is dead on, it's up 50% since 1995. That's a far bigger problem than an insulated and delusional hack like Krugman would ever care to admit.

William L. Anderson said...

Sorry, LK. That is not Say's Law. It is a caricature of Say's Law.

Bob Roddis said...

We did a pretty good take down today of LK on his less than rigorous attack upon methodological individualism and our alleged lack of appreciation for social influences in the comments to Bob Murphy's blog.

http://consultingbyrpm.com/blog/2013/04/stockman-bashing-is-seriously-getting-out-of-hand.html#comment-60549

Mike said...

Mule, I've studied Williams for a while and find his analytics to be basically sound. His citation of the old methodology for calculating CPI more closely resembles the real world experience of the average American, particularly in the category of "stuff I need to live" vs "stuff I would like to have."

But lets say for the sake of discussion he is off base. Presently he tags real CPI at 9% vs government CPI of 2%. (rounding both numbers) So lets split the difference of the two and assume "real CPI" is 5%. Even at that level its a devastating figure to most of the population. Negative interest rates are worse that they appear. GDP is overstated and remains negative. Business owners and investment professionals are being sent the wrong signals. Wage increases are understated etc etc.

Now they want to compound the fraud but invoking Chained CPI for SS adjustments which is a full substitution calculation. Thus the price of protein did not increase with the rise of steak prices because the consumer switched to hamburger. When hamburger rises well they switched to chicken so no price increase. When chicken rises I guess its dog food next.

Bob Roddis said...

I think that our libertarian/Austrian mission has failed until EVERYONE (including local TV news hosts) fully understands and constantly expresses the truth that inflation is a purposeful but unnecessary government program and not a mysterious immutable force of nature. Ron Paul spent $35 million but failed to pound that message home. We'll never be rid of the Keynesians until that is understood. Mass understanding of that idea may be all that is necessary to get rid of the Keynesians. That's why I like the MMTers so much. They like to pound that idea home but only because they are intellectually and morally challenged and think funny money is a good thing.

Mike said...

Bob,

"A fanatic is one who can't change his mind and won't change the subject." - Winston Churchill

LK is a fanatic.

No amount of intellectual reason will change him. To change would require LK to accept the sovereignty of the individual over the collective as administered by the elite. Perish the thought.

BTW perhaps someone should point out the obvious to LK that Von Mises' called his book Human Action not Collective Action Administered by Overlords.

Anonymous said...

If there has been so much inflation, then why aren't we seeing 10 dollar a gallon gasoline? Why are computers cheaper than ever? Why is gold so damn low?

http://www.bloomberg.com/news/2013-04-04/gold-approaches-bear-market-as-holdings-drop-to-seven-month-low.html

Ahem! All of you have a vested interest in trying to push an agenda. Why?

Anonymous said...

If no one can explain why gold has been so low lately, then I will have to consider Austrian economics to be another economic fluke and a failure. I'm sorry.

Mike said...

Anonymous

Average price of gasoline in 1964 was about 30 cents per gallon. The silver melt value of a 1964 quarter is presently $4.93. Average price of gas today is $3.69, $4.05 in California, lucky them. So a quarter in 1964 bought you a gallon of gas and the silver content of a 1964 quarter buys you a gallon of gas today.

Gold price at the end of 2000 was sub $300. Today around $1,600. An annual average increase of 36%. Your definition of "low" is entertaining.

Anonymous said...

"Of course, the problem with Schiff is that he wants us to believe that by stockpiling gold we can preserve wealth. isn't this just another one of those funny malinvestments thats always getting us in trouble? "

-

Schiff has been saying "buy gold" for TEN YEARS. If you took his advice then your $100k back then is now worth $500k. Sounds pretty good advice to me. Maybe you should have listened?

Tel said...

BTW perhaps someone should point out the obvious to LK that Von Mises' called his book Human Action not Collective Action Administered by Overlords.

You know, in retrospect he really should have released a companion volume to cover that.

Every year goes past and this oversight becomes more glaring.

Bob Roddis said...

How about "Collective Action Administered by Keynesian Overlords -- Because We're SO MUCH SMARTER THAN YOU!" by Lord Keynes?

Lord Keynes left many treasures this past week and we need to bookmark them for posterity. Here's another:

Lord Keynes

(1) decentralised market agents do not have the necessary information to avoid market failure in a world of Knightian uncertainty.

(2) since no Keynesian advocates complete central planning communism, government does not need the knowledge required by decentralised market agents.


http://consultingbyrpm.com/blog/2013/03/krugman-ignores-massive-human-suffering.html#comment-60316

Anonymous said...

Bob Roddis: Your irrational grudge with "Lord Keynes" concerns me. Did he do something wrong to you other than having a different economic viewpoint than you do?

Anonymous said...

The reason I am asking is that I get the impression that you care more about trying to seek points for your side than having an honest discussion and getting to the truth. Maybe that's why LK gets so frustrated with having a debate with you and maybe you are just an idiot who's intolerant and bigoted of other economic analyses.

LK had this to say about you in one of the links you posted.

"Your idiot Austrian economics is ignorant of the real world, ignorant of the real nature of markets, ignorant of the real price system, and devoid of any theoretical or practical use in the real world.

That is why Austrian economics is a fringe movement, has no real influence on policy makers anywhere in the world, and is fit only for ignorant, loudmouth cultists such as you, bob roddis."

This is a big reason why your inane Austrian mission has failed. You sound nuts to an average person.

Mike said...

Look around you. We have real world examples of the failure of the Keynesian philosophy. How much more evidence does one need?

The Krugmans and LKs of the world simply respond to such failures by saying we didn't do enough. In their world, the reason you have a hang over after a night of drinking is because you didn't drink enough.

Anonymous said...

I will concede that macroeconomics is a field that economists frequently disagree on and have disputes over, but that doesn't change the fact that Roddis has been acting like an immature crusading bellend and a moron to LK and others who disagree with his Rothbardian fantasy.

Bob Roddis said...

Everyone take a nice long look at the detailed demonstration by "Anonymous" of his expertise regarding the concepts of voluntary exchange, Cantillon Effects, and inflationary distortions that do not appear in the CPI as explained by Rothbard in "America's Great Depression".

We've won. The debate is over. All that's left is the pathetic sniping by the losers. And they certainly are losers.

Anonymous said...

You didn't answer any of my questions and all you did was refer to a book Murray Rothbard wrote around 42 years ago. How is any of what he wrote relevant for today's economy?

I swear you must be some type of Austrian troll who believes that he's exposing the great Keynesian elitist conspiracy. What are you? Glenn Beck? Alex Jones?

Anonymous said...

This same conspiracy is about as ridiculous as believing in the Illuminati, the New World Order, the racist, antisemitic Jewish world conspiracy and many others. Let's stick to facts, not delusions that anyone who gets inspiration from Keynes is out to destroy the world or inflate the money supply.

Bob Roddis said...

I have nothing against Lord Keynes other than he's a monstrous liar who still does not understand basic Austrian concepts or analysis. Further, I do not expect other Keynesians or "progressives" to appreciate that fact. My message is for other Austrians so they can appreciate that the debate is over, we have won and the Keynesians have nothing left but lies and truth suppression which is the entirety of their response to Austrian analysis.

This should be clear from the response to Stockman's NYT article.

http://consultingbyrpm.com/blog/2013/04/stockman-bashing-is-seriously-getting-out-of-hand.html

Anonymous said...

At least give LK for being able to cite his sources and passages from specific Austrian texts. Krugman has no interest in wasting his time trying to read 1000+ pages from Man, Economy and State and Human Action.

Bob Roddis said...

At least give LK for being able to cite his sources and passages from specific Austrian texts. Krugman has no interest in wasting his time trying to read 1000+ pages from Man, Economy and State and Human Action.

Interesting proposition. LK reads and cites book after Austrian book and still manages to misrepresent Austrian analysis. On the other hand, Krugman need not even read Austrian sources to misrepresent Austrian analysis.

That is just so devastating to the Austrians. You know that my hobby is eliciting such pathetic “arguments” from Keynesians, don’t you?

Mike said...

Anonymous said...

"all you did was refer to a book Murray Rothbard wrote around 42 years ago. How is any of what he wrote relevant for today's economy?"

And we have Newton’s 300 year old law of gravity. How is any of that relevant for today’s physical world?

Tel said...

Duh Mike you used the wrong example. Keynes wrote The General Theory in 1936 which was 77 years ago. Since that's even older than Rothbard's work, the whole of Keynesian Economics can pretty much be thrown out as well and truly irrelevant. Too old! Must be wrong!

Recently though, I have been bumping into little pockets of freefall around the place. Nothing to worry about, but enough to make one contemplate. Is it just me or have you guys noticed this as well?

russell said...

This we-owe-it-to-ouselves-nonsense has been around for quite a while. Lately Krugman is just the most vocal and well-known supporter of the idea.

The question I've always had for these idiots is, if it's so wonderful to owe money to ourselves, please explain how current debt servicing is helping anyone besides those that loaned the govt the money in the first place.

Sam Brennan said...

This is indeed a very controversial matter. However, you were able to present such issues in a way that could spark a debate among your readers.

wilson watson said...

It is possible to experience how it works, since they may have heard from a friend is you, the problem, they apply the majority of customers for the loan online payday loans there Before you, we do not know the situation. Be a comprehensive understanding of the re-payment of the credit of the customer loan agreement is the next payday. In order to pay an advance on the payday loans no credit check refund will be adjusted automatically the bank account of the customer. The payday loan system, you do not need to go the customer to pay for the store. When applying for a bank loan in order to repay the bank account to automatically plan before. The advantage of hidden, usually ignored, payday loans online cash advance, offers credit terms some major drawbacks when the borrower has occurred. Overdraft fee of goods also complicates the problem, therefore, enough money, bad check fees and date is a condition of avoiding most people to bank or bank of bank account of the individual. no credit check loans , of course, be subject to payday loans, each of which understands the terms and conditions very important. Now, the phenomenal growth of consumption, to make people beyond consumer habits, the means of them. I have lived in the end, I know the savings or no savings, a little. By default, poor people pay their bills. Debt wins of people with bad credit credit score impact of your negative. Well, what would you do?Cash loans bad credit, are illuminating the dark days of the financial crisis.

For more info : http://paydayloanswithnocreditcheck.co.uk

wilson watson said...

It is possible to experience how it works, since they may have heard from a friend is you, the problem, they apply the majority of customers for the loan online payday loans there Before you, we do not know the situation. Be a comprehensive understanding of the re-payment of the credit of the customer loan agreement is the next payday. In order to pay an advance on the payday loans no credit check refund will be adjusted automatically the bank account of the customer. The payday loan system, you do not need to go the customer to pay for the store. When applying for a bank loan in order to repay the bank account to automatically plan before. The advantage of hidden, usually ignored, payday loans online cash advance, offers credit terms some major drawbacks when the borrower has occurred. Overdraft fee of goods also complicates the problem, therefore, enough money, bad check fees and date is a condition of avoiding most people to bank or bank of bank account of the individual. no credit check loans , of course, be subject to payday loans, each of which understands the terms and conditions very important. Now, the phenomenal growth of consumption, to make people beyond consumer habits, the means of them. I have lived in the end, I know the savings or no savings, a little. By default, poor people pay their bills. Debt wins of people with bad credit credit score impact of your negative. Well, what would you do?Cash loans bad credit, are illuminating the dark days of the financial crisis.

For more info : http://paydayloanswithnocreditcheck.co.uk

wilson watson said...

Today, it is bad for a long time is taking a six-month borrowing of loan service thousands of people, I met you on the Internet, all of which need it. Credit loans for people on benefits of this cash payday is similar to rent, such as when you like that takes a bank loan, other options. It can be obtained online bank loan is difficult. This service may at any time you are feeling for how the crisis he gets it to you-consuming.

wilson watson said...

Everyone has unforeseen expenses, such as medical, academic or emergency car repairs. These types of traditional method of access to credit, the financial needs are strict and time-consuming. For many consumer credit checks and past credit history is a stumbling block to their approval. One hour payday loans, the recent emergence is a fast, effective way responsible borrowers to avoid these obstacles. Because you just check your next payday lender to repay the loan guarantee from the money is not required. Credit history is not worried about the lender, if the timely repayment hour payday loans can actually help repair your credit history.
Although you can find a walk in the quick loans application online the easiest and most convenient way is by finding a qualified lender. Now you can easily find a reputable financiers, push you, between the popular payday, you need to deal with, no credit check real money. One hour payday loan is a simple agreement between you and the creditor to provide what you need in exchange for your promise to repay on your next payday loans no credit check
are very short term, and to assess and steep interest rates. This is your lender agrees to assume the risk of laying out guaranteed payday loans , you need to weigh. Although the fees charged over a period of time, even years, using traditional methods payday loan, the lender is entitled to make their money right from your disposable repay the lender.

darwin saymond said...

Bill, the older of two brothers payday loans no credit check said, "I will not lie," "Even when I think Evan brought it to me I think this is a little strange."His brother Evan is a company that offers payday loans to fund the opening of the representation of men clearing pool cleaning service to prepare a master plan for the bill when you think back four years ago to be on a summer afternoon.
Evan brothers shared a no credit check mobile home with a small kitchen, going to court, despite his initial reluctance heard Bill.Evan, a man inspired by the opportunity to fire him on the success of a small business seminar've introduced one-too-many success - before he retired payday loan business and want to sell.
"I do not know how to persuade," Evan is all about I was absolutely wild eyes "confession.Is recommended.Someone other than me, my brother would think of the spirit.Nevertheless, he was one reasonably to prove me wrong, and I think him bold. "
Bill Evan was forced to explain that some of the business for so reluctant not to place your fingers. "Speaking of how happy he was to see just two people.I think it's a moment in the lives of people involved in a desperate, boring business of course, but I think Evan did all this to help people who repeat itself tells you how to. "
"He's coming to him, people are looking for solutions, and that can provide relief is felt that gave him a purpose." Evan says. "Purpose I have made. "
"And those who made money." Bill practical chimes.
Two brothers and the city is now composed of three outlets for their money-making enterprises acknowledged that the company is not shy.
"We have people in charge do?Yes. We have the same overhead costs, have any business, "Bill says."Moreover, we have to risk all.Customers when they walk door to cash in his pocket as we walked.The good news is that most, but not all of them will pay us immediately. "

http://lookpaydayloansnocreditcheck.co.uk

darwin saymond said...

Bill, the older of two brothers payday loans no credit check said, "I will not lie," "Even when I think Evan brought it to me I think this is a little strange."His brother Evan is a company that offers payday loans to fund the opening of the representation of men clearing pool cleaning service to prepare a master plan for the bill when you think back four years ago to be on a summer afternoon.
Evan brothers shared a no credit check mobile home with a small kitchen, going to court, despite his initial reluctance heard Bill.Evan, a man inspired by the opportunity to fire him on the success of a small business seminar've introduced one-too-many success - before he retired payday loan business and want to sell.
"I do not know how to persuade," Evan is all about I was absolutely wild eyes "confession.Is recommended.Someone other than me, my brother would think of the spirit.Nevertheless, he was one reasonably to prove me wrong, and I think him bold. "
Bill Evan was forced to explain that some of the business for so reluctant not to place your fingers. "Speaking of how happy he was to see just two people.I think it's a moment in the lives of people involved in a desperate, boring business of course, but I think Evan did all this to help people who repeat itself tells you how to. "
"He's coming to him, people are looking for solutions, and that can provide relief is felt that gave him a purpose." Evan says. "Purpose I have made. "
"And those who made money." Bill practical chimes.
Two brothers and the city is now composed of three outlets for their money-making enterprises acknowledged that the company is not shy.
"We have people in charge do?Yes. We have the same overhead costs, have any business, "Bill says."Moreover, we have to risk all.Customers when they walk door to cash in his pocket as we walked.The good news is that most, but not all of them will pay us immediately. "

http://lookpaydayloansnocreditcheck.co.uk