Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
I'm not sure what Krugman you're reading. Certainly not the Krugman I'm reading, who constantly rails against the ECB, Merkel and austerity.

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Fri Jan 27th, 2012 at 03:48:38 PM EST
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I'm reading the Krugman that says we haven't had inflation so far solely because money velocity has been going down. Not only have we had price inflation, as money supply hasn't significativelly moved the past 3 years. While I agree with him that velocity can have a larger role than supply at times, I'd avast from claiming that's what happening now. I very much doubt Keynes would advocate for printing money agaisnt an environment of resource constraints, and where gold is where it is today.

by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Sat Jan 28th, 2012 at 05:11:14 AM EST
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The price of gold is totally irrelevant to any reality-based macroeconomic planning.

And you cannot in general say that it is improper to print money in the face of resource constraints, unless you care more about preventing inflation than about reality-based macroeconomic planning. The question of whether it is sensible to print money is orthogonal to the question of resource constraints, because money is not a commodity, it is a tool for exercising political power. Whether an exercise of political power by the state is merited has no simple relationship with the state of raw material availability.

In the present situation, for instance, printing money is a very sensible thing to do in the face of current resource constraints. Because printing money is a prerequisite for taking those actions which will help to reduce our reliance on the resources whose availability is presently constraining us.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Jan 29th, 2012 at 12:37:43 AM EST
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