Thursday, November 20, 2014

OMG Japan's Prime Minister is Acting on Advice He Has Received from Paul Krugman

Paulie writes at NYT:
Shinzo Abe is doing the right thing, seeking to delay the next rise in consumption taxes; this is good economic policy, and also a fairly new experience for me — I met with a national leader, made a case for the right policy, and he’s actually doing it!
Of course, there is nothing wrong with attempting to limit a tax burden. It should be part of an overall program to shrink government involvement in an economy. But Paulie, no doubt, wants government spending to expand, with the government going into debt to fund the spending.

How serious should Abe really take Paulie? Paulie's view on price inflation in Japan should be a clue.

Paulie writes in the same NYT post:
But Japan isn’t suffering from stagflation; neither is Europe. They are, instead, suffering from low inflation or deflation,
Low inflation/deflation?

Here are the latest CPI numbers out of Japan:

CPI JP recent months

 september 20143.280 %
 august 20143.290 %
 july 20143.400 %
 june 20143.607 %
 may 20143.707 %
 april 20143.410 %
 march 20141.610 %
 february 20141.512 %
 january 20141.410 %
 december 20131.611 %


  1. That's good. Hopefully Abe follows Krugman's advice to a T. That should be the final nail in the "we didn't do enough" argument on the part of Keynesians. Go Abe!!!

    BTW, I'm a hard-core Austrian anarcho-capitalist and think Krugman is dumber than a box of rocks.

  2. I guess its not enough for Krugmans economic ideas to destroy just the United States. Sorry Japan, we dont like him either.

  3. So when Japan enters a quadruple dip recession (assuming they escape recession, and don't completely implode in the meantime), it will be nice to know that we can point blame at Krugman's idiotic policy prescriptions.

  4. Wait and see.... when Japan implodes, the silence from the usual quarters will be DEAFENING.
    They just didn't do enough...

  5. Nobel prizes are hazardous to the health of economies around the world. It's the halo of the Nobel that give Krugman such credibility.

  6. Nobel prizes are hazardous to the health of world economies. It's the halo effect of the Nobel that gives Krugman such influence!