Dem some fighting words!

Not even a week ago Krugman posted that anyone who says he advocated a housing bubble in 2002 to offset the internet bubble of the late '90's is both a fool and liar. So now in today's main editorial in the WSJ  about the legacy of Ben Bernanke did they throw the gauntlet down with this line -- "Mr. Greenspan nonetheless followed the advice of Paul Krugman to promote a housing bubble to offset the dot-com crash."  Precious.

Krugman vs WSJ & Stephens - it gets nasty!

Krugman and WSJ columnist Bret Stephens are in a slug fest. It should be noted that Stephens won the Pulitzer Prize in last year - so this is quite high profile.

It started when Stephens blasted Obama for a economic inequality speech. Not quite sure why Stephens was even writing about this since he focuses on foreign policy but evidently he made a big mistake - he used nominal figures to show higher incomes for poor folk instead of using inflation-adjusted numbers. When using inflation adjusted then there was no increase for the poor. Of course Krugman jumped all over this since he's been focusing on inequality lately. Stephens admitted his error but still said it was an innocent mistake that doesn't change his basic hypothesis that all Americans are enjoying rising incomes, using CBO data to back it up.  Interestingly enough Krugman also uses this data to back his claim that the same data shows rising inequality.

Then for Krugman's regular weekly column his told the story again how Stephens used the wrong data to give proof that conservatives are purposely using confusing data and the WSJ didn't issue a correction. This, of course, send Stephens through the roof and he responded in his regular column that Krugman is bully and why hasn't Krugman issued corrections for saying in 2002 that Greenspan should start a housing bubble or that Europe is an economic success in 2010. Krugman then responded WTF... that was not a correction since it wasn't posted to the original article, just in an on-line post.

exciting stuff!

Krugman is really mad at the Washington Post

This is the just latest time that Krugman has bashed the Washington Post. He can't believe they published a news article that claimed the Ryan/Murray budget deal is a budget buster. He says how the one 'expert' mentioned in the article is really a deficit hawk (not a true unbiased analyst) and why could they have not also gotten a quote from an expert who doesn't believe deficits are a problem. Krugman provides some data from the CBO (Congressional Budget Office) that shows deficits are not a growing concern.

The future, economics and the Great Recession, Cochrane has no credibility -- and a little turkey defense

Krugman tells us he believes that the world could be on the cusp of major technological breakthroughs. Some examples are self-driving cars, good, automatic translation, computer speech recognition, etc. Krugman's post is in response to some people saying technological innovation is coming to an end.

Krugman then has a couple posts defending economics (specifically main street, textbook macroeconomics). He says that this standard economics had a good model for the economic crash and what to do for recovery – namely have governments spend more money while interest rates are very low and other participants in the economy are not spending. He ends one post with quite a zinger saying the problem was not with economics but with some economists who decided to turn their back on standard macro and we should go back and review the old classical economics texts.

For Thanksgiving, Krugman refutes a half in jest post about how people hate turkey because chicken is way more popular. Krugman says bogus – it’s just that chicken is much more convenient…

Krugman goes on quite a riff against John Cochrane who claimed four years that inflation was a danger – but now that no inflation has come - has yet to admit he’s wrong or revise his model. Krugman states quite clearly that this should reduce Cochrane’s credibility.

Mean for the sake of mean and ObamaCare

One thing that really sets Krugman off is when officials take policy positions that cause hardship on people when there is no justification for it. His recent example calls out the head of the German Central Bank for saying that printing money is not the way to get out of the financial crisis. Krugman is flabbergasted since he says there is no grounds for this argument as a higher inflation rate would help alleviate the situation. Krugman can't understand the desire for these officials to cause pain when solutions exist that will not cause pain and suffering.

Krugman points out that the latest estimates are that healthcare costs are slowing and some of this may be due to the implementation of Obamacare.

Also on Obamacare he agrees the roll-out has been a disaster but he feels the technical glitches will get worked out quickly. The big story though is that more and more people are getting access to affordable healthcare and that will be the story that will dominate the elections next year -- so the Republicans if they continue to rail against it will be on the losing side.

Larry Summers is the man and a new I was wrong mea cupla

Krugman is really, really jealous of Larry Summers -- basically at a recent very important economics conference, Summers gave a presentation that knocked the socks off of everyone -- including Krugman. Krugman says he has hinted at some of the points in previous works but Summers but it all together in a way that is now getting a lot of attention. The jist of it is that the economy's current depressed state may be the new normal and the only way to get higher employment is through bubbles. The reason for this is that declining population growth which reduces demand. The only way out of this situation is to force more demand -- through government spending and/or aim for higher inflation target.

It is fun to follow Krugman as he bashes others. Three years ago a number of economists signed an advertisement warning of bad things (inflation) if US government didn't stop spending so much money. Krugman now points out that no inflation happened but rather than saying we should just not listen to those who warned, we should see how they reacted. What's especially interesting is that Krugman points out that he has been wrong over the years and he gives a new example that he has not previously mentioned and it's a response to Nigel's long critism of him. He admits he was wrong on the euro coming to an end - back in mid 2012 he said it would just be a matter of months. Krugman ends his point by pointed out that none of the academics who signed the letter have admitted their error and this is a sign of poor character.

For European recovery higher inflation is needed and Ted Cruz is so crazy that no one dares be crazier!

Krugman continues to pound away at the need for greater inflation in the Euro zone. Interestingly enough the European Central bank actually cut their interest rate which of course Krugman applauded, since that should allow for greater inflation.

Krugman makes the point that higher inflation in the late-90's in southern Europe helped Germany recover from its doldrums. But now Germany is advocated low inflation which will not let southern Europe recover. Krugman calls out this hypocrisy - since Germany is now telling southern Europe to recovery through austerity which it never had to do.

On the political scene Krugman points out that no one wants to be seen at crazier than Ted Cruz. You would expect a wide range of viewpoints but it seems right wing stops at Ted Cruz.