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Interest Rates, Deficits, Monetary Policy, Inflation, Debt...
Last edited Sun Jan 6, 2013, 04:40 PM - Edit history (4)
Poor Paul Krugman continues to try to live down being right—the ultimate crime.
http://krugman.blogs.nytimes.com/2013/01/05/monetary-rage-2/
Since he has such difficulty convincing people that increasing the money supply is powerless to create inflation in a liquidity-trapped and depressed economy (despite abundant real-world evidence of the effect), I'll suggest a metaphor that might help.
Pouring water into a bucket causes the level of water in the bucket to rise unless there's a huge whomping hole in the bucket.
Of course it probably wouldn't really help. It would merely lead to this exchange:
Pouring in more water won't raise the water level much, or for very long.
That's preposterous! You're claiming, with a straight face, that putting water in a bucket doesn't raise the water level?
No. I am claiming that to be the case only when there's a big whomping hole in the bucket. Which there is. In this bucket.
Hey everyone, check out this lunatic. This is how liberals think. Let's just ignore the laws of physics and common sense so we can write more welfare checks... and the magical bucket will never overflow. This guy is obviously not a serious person.
Personal attacks aside, does it strike you as odd that you have been watching water poured into this bucket for four years, but the water level is the same? Doesn't that suggest that there is a mystery you need to explain since it is your theory that keeps failing to predict what goes on in this bucket?
I have nothing to explain. Everyone knows that the water will rise eventually and the bucket will overflow, with disastrous consequences.
You keep saying that. When is this "eventually" going to happen.
Well, eventually that hole in the bucket will get fixed by the bucket fairy, and then the water will rise very, very fast.
Well, if there was a bucket fairy that would be right. Adding water to a bucket without a big hole in it would raise the water level. And if that were the case we would simply turn off the hose so the bucket wouldn't overflow.
So you admit it!
That's preposterous! You're claiming, with a straight face, that putting water in a bucket doesn't raise the water level?
No. I am claiming that to be the case only when there's a big whomping hole in the bucket. Which there is. In this bucket.
Hey everyone, check out this lunatic. This is how liberals think. Let's just ignore the laws of physics and common sense so we can write more welfare checks... and the magical bucket will never overflow. This guy is obviously not a serious person.
Personal attacks aside, does it strike you as odd that you have been watching water poured into this bucket for four years, but the water level is the same? Doesn't that suggest that there is a mystery you need to explain since it is your theory that keeps failing to predict what goes on in this bucket?
I have nothing to explain. Everyone knows that the water will rise eventually and the bucket will overflow, with disastrous consequences.
You keep saying that. When is this "eventually" going to happen.
Well, eventually that hole in the bucket will get fixed by the bucket fairy, and then the water will rise very, very fast.
Well, if there was a bucket fairy that would be right. Adding water to a bucket without a big hole in it would raise the water level. And if that were the case we would simply turn off the hose so the bucket wouldn't overflow.
So you admit it!