Paul Krugman

These people who advocate just printing more paper money are truly economic midgets. When Nixon pulled the US off the gold standard, the US dollar was, in turn, designated as the currency for the purchase of and trade in, oil. Now, because of the declining value of the US dollar, pressure is mounting to delineate oil transactions in a currency other than the USD. When that happens, just watch how far the USD will fall - and all hope of climbing out from under their debt will be gone. Forever.

I ignored the warning and followed the link to the Democratic Underground. I now have to scrub my brain and watch Friedman on youtube to restore my IQ.

That's what the Weimer Republic called "famous last words."

It does not seem to have occurred to the author to actually look back in history.

There are have been many countries who issue their their own fiat currency and who have suffered fiscal crisis (e.g., Mexico, Argentina, Russia, New Zealand and so on). The results have sometimes been horrendous, wiping out the wealth of the citizens.

None of these Leftists appear to have heard of Zimbabwe.

Or Japan.

Modern Monetary Theory is all the rage these days amongst the hard of thinking. These types of claims are common amongst MMTers. Their biggest error is to confuse money with wealth.

And when you point out what printing money does to inflation, they claim "inflation is impossible in a slack economy." The massive unemployment during the hyperinflation of the Weimar Republic does not seem to phase them, nor the stagflation three decades ago.

It works for Zimbabwe. After all, even a kid there is a multi-billionaire.

"That's what the Weimer Republic called "famous last words."

Posted by: langmann at October 23, 2012 11:26 AM "

Exactly. Then Zimbabwa,now BamBam wants a go at it.Guess they don't teach history or economics 101 at them thar madrassass,or Haavaad for that matter.

Obviously this person has failed to factor in the cost of those coloured ink cartridges!
It's amazing what a bubble this character lives in: first, he thinks it will work, and secondly, seems to think it's an original idea. It seems to me I hear this floating out of the morass of the moonbat community about once a month.

You can be a multi-millionaire and lose your fortune buying a loaf of bread.

I've heard Krugman and other Leftist Economists (isn't that an oxymoron) say the stupidest of things. With a straight face they will tell you that:

1. America doesn't have any real debt and can just print money endlessly to solve it's "apparent" debt problem.

2. To solve the unemployment problem, a government can just pay its unemployed people to dig holes ... and then fill them. Repeat as much as necessary.

Neither of these things will help a country move forward - a 10 year old child knows that - but yet Nobel prize winning economists like Krugman believe such things to their core. It's both sad and pathetic. :-(

the author of that stupidity is likely the ditzi blonde seated right side, first row.

http://nation.foxnews.com/ohio/2012/10/23/romney-wins-cbs-focus-group-ohio

ahhhh my bad . . . too many windows open . .

http://nation.foxnews.com/2012-presidential-debates/2012/10/23/watch-luntz-focus-group-erupts-near-brawl

A pure reflection on the Education system that is faililng our children at all levels.

There should be basic to advanced Economics classes/modules added to History and Math classes. Starting in grade 3 and right to graduation.

The mind wobbles looking into the Medusa minds of the loony left.

The snippet was enough, I could never suffer the full psychological trauma of opening the full article.

@ Theredsuit
There should be basic to advanced Economics classes/modules added to History and Math classes. Starting in grade 3 and right to graduation.

Add in Personal Finance too.

The US dollar became the world's reserve currency in 1945 with the acceptance of the Bretton Woods Agreement. The USA would hold the gold and the USA would pay $35 USD for every oz of gold. Exchange rates were fixed ($2.50 to the pound sterling, 4 DM to the $, 5 FF to the $ and US$1.1 to the Cdn$). The USA was the only large functioning economy.

When Bretton Woods collapsed in 1970 and the USA left the gold standard the DM and FF climbed in value, as did the Cdn $, Sterling started a long slide down. The "stagflation" of the 1970's (high monetary inflation AND high unemployment rates) proved YET again an economy can have inflation and unemployment at the same time. Inflation didn't end until Reagan supported Volkmer's tight money policy which pushed the prime interest rate to 21% in Canada!
Inflation occurs when governments print money to pay its debts and other bills. How soon the fools forget.

I'm not even sure that's the dumbest thing in that "article".

"So, why the hue and cry about America being broke? Simple. The elites in this country need to create a defcit and scarcity crisis in order to dissuade the public from voting for increased social spending on things like a universal health care program, better education, better benefits for SS recipients better infrastructure, etc. You cannot argue against the logic nor the need for these programs, but you can argue that you cannot pay for them. Additionally, more social spending means that the public is not as dependent on corporate America for their economic survival. For example, if you have universal healthcare, you don't have to take a job just for the health benefits. If you have a generous Social Security program, you don't have to invest in the market."

I was planning on emphasizing the stupidest things in that paragraph, and then I realized that there was no way to do that.

All is well and good until the dry cleaner, the plumber, etc. figure;"Hey, all this guy is doing is printing money on his color printer! I'm gonna at least make him give me 5 times as much of that paper or maybe I should demand that, rather than just giving me paper that isn't even worth wiping my behind with, maybe I should demand something real and has some value to it!"

Interest Rates or Inflation - it's a simple mechanism to manage risk. Something the author of that little screed seems to have missed.

The cool thing about having obtained a degree in face painting or marxist feminist liberation theology or whatever is the rage these days is that annoying little economic facts may be wished away.

It is all about confidence. Presently the US is getting away with all of the printing because the rest of the world continues to have confidence in the value of the dollar. If that ever changes, hold on to your hats, it will be a $#!+storm.

What did Obamba call China last night? - {“An adversary, with potential as a trade partner”}

Foreign Investors hold 46% percent of US debt, China holds around 8% or 1.2 Trillion according to the Federal Reserve, which is more than the amount owned by US households $959 billion.

You can only owe people money for so long until they want some return or the full value of their investment back. Printing money and devaluing currencies, or declaring bankruptcy to get out of debt is not a wise option especially when you owe powerful mafia families or nuclear dictatorships that value “saving face” over everything else.

The US is fast becoming a Paper Tiger, regardless of its technological military might to the Chinese.

Well hated by much of the world, domestically vacuous on all levels of society it is well on its way to collapse and subsequent cannibalizing/ sharing of its remains by the barbarous hordes, foreign and domestic.

from article:
"You see, the world needs our dollars because the world needs oil, and in order to buy oil, you need dollars, which means that the world needs to stockpile dollars, and that means that the U.S. can print all of the money that it wants"

IF the world needs dollars why doesn't the world just print their own U.S. dollars, eh?

It is all about confidence.
~Gus

Exactly.
Currency is a medium of exchange representing confidence in the productivity of "stuff" other people want to own.
Putting record numbers of Americans on food stamps does not raise confidence in the belief that America is going to continue to produce "stuff" that other people want to have.

Simple printing more dollars de-links the currency from the productivity the currency is supposed to represent.
It is called DEBASING the currency.

"The best way to destroy the capitalist system is to debauch(debase) the currency."
~Vladimir Lenin

IF the world needs dollars why doesn't the world just print their own U.S. dollars, eh?

On North Korean counterfeiting of the US dollar:

U.S. government and law-enforcement officials began to say in public something that they had long said in private: the counterfeits were being manufactured not by small-time crooks or even sophisticated criminal cartels but by the government of North Korea. “The North Koreans have denied that they are engaged in the distribution and manufacture of counterfeits, but the evidence is overwhelming that they are,” Daniel Glaser, deputy assistant secretary for terrorist financing and financial crimes in the Treasury Department, told me recently. “There’s no question of North Korea’s involvement.”

www.nytimes.com/2006/07/23/magazine/23counterfeit.html?pagewanted=all&_r=0

Rizwan, I knew that.
The NorKs aren't doing it so that they can buy stuff, though. They're doing it purely to debase U.S. currency.
Any nation pretty much has the ability to do the same thing to another nation's currency.
The reason they mostly don't do this is because it would harm their own ability to trade with other nations if it was done back to them.

Most rogue nations, like the NorKs who have little to trade, have no such disincentive.
Even Iran knows that debasing U.S. currency would harm their own ability to get hard currency for their oil, gas, pistachios, etc.

CHris in the Bridge:

Exactly.

Ultimately people don't want money. They want purchasing power - the ability to acquire the goods and services they need or want. And people are highly sensitive to this. The plumber knows immediately when his purchasing power has taken a hit, for one day he's eating steak and the next ground chuck.

It would be interesting to know what decisions have already been made by nations, corporations and investors depending on who wins the US election. What's the dollar gonna look like 5 years out depending on who wins?

Everybody gets freebies, i.e. something for nothing, and no one is out. That's like the town where all the kids were above average.

I'm surprised there are actually commenters on the Democratic Underground taking issue with the moron who posted the article.