Swedish Central Banker Slams Krugman

Deputy Governor of the Swedish central bank, Per Jansson ,says  Paul Krugman's comments about Swedish monetary policy suggests he hasn’t read enough about Sweden, reports Bloomberg.

Always in favor of mad money printing, Krugman criticized the bank for raising rates at the height of Europe’s debt crisis in 2010 and 2011, and then for not cutting fast enough.

Jansson slammed Krugman for his comments.

“When he described Sweden as sort of a deflationary economy, and makes these parallels to Japan, you wonder, has he ever had a look at the data?” Jansson said in a March 12 interview in Stockholm. “Has he seen how Swedish GDP recovered over these crisis years? It completely outperformed the euro area, of course, but even the U.K. It’s close to the U.S.’s performance.”

Krugman this month used the Riksbank as an example to warn the U.S. Federal Reserve against pulling “the rate-hike trigger,” in his regular column at NYT.

“If the Fed moves too soon, we might end up losing millions of jobs we could have had,” he said. “In the worst case, we might end up sliding into a Japanese-style deflationary trap, which has already happened in Sweden.”

“You would wish when he says this, that Sweden looks like Japan and stuff,” that he “write fewer articles and have more of a look at the data and then come back again,” Jansson said. “I don’t know why he does that; it’s a mystery and it doesn’t make him come across as a guy who is very well informed.”

-RW