Write These Names Down (And Remember Them When the Price Inflation Acceleration Hits)

Larry Summers, who famously, when he was Harvard's president, blew up the University's  endowment with derivatives trades gone bad (derivatives trading with endowment funds?) is, along with Paul Krugman, the most vociferous Keynesian calling for the Federal Reverse to flood the economy with more money and keep interest rates low.

He writes in FT:

Will the Federal Reserve’s September meeting see US interest rates go up for the first time since 2006? Officials have held out the prospect that it might, and have suggested that — barring major unforeseen developments — rates will probably be increased by the end of the year. Conditions could change, and the Fed has been careful to avoid outright commitments. But a reasonable assessment of current conditions suggest that raising rates in the near future would be a serious error that would threaten all three of the Fed’s major objectives — price stability, full employment and financial stability.

Krugman backs him up:

Larry Summers argues that a Fed rate hike would be a big mistake; I completely agree.

And then Krugman takes a typical nasty swipe at those who aren't in favor of money printing:

What’s odd about this debate is that it’s not like debating monetary policy with the seventeen stooges conservatives whose doctrine tells them that fiat money will turn us into Zimbabwe any day now, and are impervious to evidence.

Austrian school business theorists, Krugman and Summers are not. And neither comes close to being the gentleman that Ludwig von Mises was.

I wonder if Krugman also backs Summers over the Iris Mack affair. Mack correctly warned Summers about the dangerous derivatives trades, Her reward? She was fired.

That's how Krugman's homeboys roll.

 -RW