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Krugman: Gas and Food prices have Nothing to do with FED Policy
- Thread starter achilles28
- Start date
When did i ever say any differently?
The fact of the matter is the real buffoon in this argument is Krugman, and anyone else who is arguing that interest rates dont effect the price of oil, or food, they seems to think the fed has some sort of pixie dust, where they can flood the system with dollars, in order to create demand, but that there is only going to be added demand, and inflation on the things the fed wants to inflate.
The fact of the matter is the real buffoon in this argument is Krugman, and anyone else who is arguing that interest rates dont effect the price of oil, or food, they seems to think the fed has some sort of pixie dust, where they can flood the system with dollars, in order to create demand, but that there is only going to be added demand, and inflation on the things the fed wants to inflate.
Quote from Ricter:
Whoa!
Quote from Covertibility:
Fed operations and gold are linked but not other commodities.
See my post, directly above yours. It's risk-on/risk-off. Cheap money forces speculative risk-taking in hard assets, to gain yield. Which asset class, is really anyones guess. This is how bubbles are formed. Cheap money > pools in a specific asset class > attracts more money ("first mover" benefits) > bubble. 2000 nazdaq. '04 US real estate. '07 crude. etc. '10 was gold and silver. It's pure hot money floating around, jumping around, looking for a home.
If you were a regular reader of his column you'd understand that he does not believe that, that he's well aware there will be across the board inflation. When, and if, all this money that's being "printed" ever leaves the hands of the few, that is.Quote from Max E. Pad:
When did i ever say any differently?
The fact of the matter is the real buffoon in this argument is Krugman, and anyone else who is arguing that interest rates dont effect the price of oil, or food, they seems to think the fed has some sort of pixie dust, where they can flood the system with dollars, in order to create demand, or but that there is only going to be added demand, and inflation on the things the fed wants to inflate.
Quote from Max E. Pad:
When did i ever say any differently?
The fact of the matter is the real buffoon in this argument is Krugman, and anyone else who is arguing that interest rates dont effect the price of oil, or food, they seems to think the fed has some sort of pixie dust, where they can flood the system with dollars, in order to create demand, but that there is only going to be added demand, and inflation on the things the fed wants to inflate.
Exactly. It's nonsense. They can't effect one without the other. On the one hand, you've got aggregate demand (which is exactly what CB'ers intend to stimulate), which pushes energy up. On the other, you've got investors in a ZIRP environment, who chase yield in hard assets. Oil happens to one of the best vehicles to do it.
See now we are getting somewhere with Krugman, and the reason why i hate him so much, he is notorious for making spurious claims like the one in the video in the OP where he made the claim that fed policy wont really have any inflationary effect on oil and food, so here he is calling for the fed to aggressively pursue inflationary policies, and then he is lying to people about what the effects are going to be. He does this all the time. Hell he even made the claim that inflation is good for workers in this video, and it is the complete opposite, inflation is good for people who have access to leverage, and that sure as hell isnt your every day guy working on an assembly line, half the reason the "little guy" is getting screwed so badly is because wages arent keeping up to inflation.
Quote from Ricter:
If you were a regular reader of his column you'd understand that he does not believe that, that he's well aware there will be across the board inflation. When, and if, all this money that's being "printed" ever leaves the hands of the few, that is.