When historians look back at 2008-10, what will puzzle them most, I believe, is the strange triumph of failed ideas. Free-market fundamentalists have been wrong about everything — yet they now dominate the political scene more thoroughly than ever.The implication is that the 2008-10 period was a period of "free-market fundamentalism". He then identifies Ron Paul as a "free-market fundamentalist":
How did that happen? How, after runaway banks brought the economy to its knees, did we end up with Ron Paul, who says “I don’t think we need regulators,” about to take over a key House panel overseeing the Fed?So if 2008-10, was a period of "free market fundamentalism", please explain what these agencies are all about:
The Federal Deposit Insurance Corporation
The Federal Reserve Board
The Office of the Comptroller of the Currency
The Securities and Exchange Commission
The Office of Thrift Supervision
The Consumer Financial Protection Bureau
I've done some consulting to banks, and if Krugman doesn't think regulators get into the business of banking from every angle possible, well then I liked to sell Krugman a 10 million dollar Zimbabwe note, real cheap.
The only thing I can conclude is that the Princeton boys are in panic that Ron Paul is going to have an impact and are scared to death that their antics are about over.
Here's a CNN video which includes a clip from Princeton professor Alan Blinder calling the Ron Paul monetary policy chairmanship "a little scary" and saying that getting politicians involved with the Federal Reserve is "a very dangerous brew."
Now what's remarkable about this comment from Blinder is that he is running one of the biggest scams going between privilige and the government. Nassim Nicholas Taleb explains:
Last year, in Davos, during a private coffee conversation that I thought aimed at saving the world from, among other things, moral hazard, I was interrupted by Alan Blinder, a former Vice Chairman of the Federal Reserve Bank of the United States, who tried to sell me a peculiar investment product. It allowed the high net-worth investor to go around the regulations limiting deposit insurance (at the time, $100,000) and benefit from coverage for near unlimited amounts. The investor would deposit funds in any amount and Prof. Blinder's company would break it up in smaller accounts and invest in banks, thus escaping the limit; it would look like a single account but would be insured in full. In other words, it would allow the super-rich to scam taxpayers by getting free government sponsored insurance. Yes, scam taxpayers. Legally. With the help of former civil servants who have an insider edge.Talk about mixing a dangerous brew, Blinder is doing it for huge $$$. It's such a dangerous brew that the previously friendly FDIC press office refuses to answer my question about whether Blinder's program creates "moral hazard".
I blurted out: "isn't this unethical?" I was told in response, "We have plenty of former regulators on the staff," implying that what was legal was ethical.
It clearly looks to me like the Princeton boys are in a panic. First we had Bernanke, himself, lying on 60 Minutes. Then we had schemer Blinder warning about Ron Paul. And now it appears that Krugman's only role at NYT is to come up with ludicrous attacks on Ron Paul.
Sweat boys, sweat.
What needs to happen is a roundtable - perhaps hosted by Judge Napolitano (not an anarchist, not anyone that can be labeled too easily or easily criticized for lack of credibility or knowledge) - with serious panelists like Robert Wenzel sharing facts about what the FED is, how it came about, the history of the Roaring 20's/Great Depression (basic fallacies), perhaps a discussion about the depression of 1920/21, and all the modern nonsense associated with the FED...1971, the tech bubble of late 90's, the Bush credit bubble, the collapse, the bailouts and what's happening now with the monetary base versus the money supply.
ReplyDeleteIn this roundtable, Krugman should be slammed. Bernanke should be gutted. Greenspan should also be slammed...for being wrong and for KNOWINGLY doing the wrong thing/contradicting his own understand of money and inflation as indicated by his earlier work.
This roundtable needs to have high production value and should be done right now. CSPAN should be invited.
Words like criminal, immoral, damage, etc should be used. Names should be named. Milton Friedman should also be slammed/exposed as a free market fraud.
The purpose of this roundtable should be to educate, but also to be on record for when the inevitable currency collapse happens. The PR for the inflationists will ALWAYS smother the Austrian voice. Krugman could say absolutely anything, and it will be adopted. Since Krugman is rewriting history right now, we need to respond with our best players and at least be on record for what our stance has always been.
Nobody believes Krugman and his kind anymore. The funny thing is they are the last to realize it. But as this article correctly observes, they are beginning to panic.
ReplyDeleteI have to laugh at that last Krugman paragraph. To me that demonstrates how little he really understands about human nature and how the real world operates in spite of his faith in central planning and government intervention. Note to Krugman: Retired middle class folks, you know the ones you supposedly care about, have been doing what Blinder is willing to do for a fee, for many, many years. My 84 yo MIL learned a long, long time ago how to game the banking system. To me this demonstrates how efficient the market is, that it will seek out and exploit anyone, individual, government or business that prices their product improperly to the favor of the buyer. Of course to cranks like Krugman this just means that more government intervention is needed which will undoubtedly create more moral hazard and queer market behavior which will require more intervention. As Reagan once said, the more the plans fail, the more the planners plan.
ReplyDeleteLady Gaga tweets the approval of DADT to the morally bankrupt congress. P.G. trumpets the lies from the power elite. The power elite screws the ordinary bloke with subterfuge and the scumbag bankers win again. When does the next flight off this stinking mess of a planet run by this scum leave. It is only Monday Lord, please help?
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