Posted by: graemebird | October 13, 2008

Krugman Wins The Prize

He’s a Keynesian. He get so many things wrong. Its just another year where George Reisman gets dudded. And Hernando De Soto as well but then again Hernando should probably get the peace prize……. even though Hernando isn’t a psychopathic killer (Arafat and others) or a practicioner of the big lie technique (Gore and others).  But just a man who brought property rights and the ability to create wealth to millions of the poorest and most put-upon people on the planet….. Which puts Hernando at a disadvantage for the peace prize no doubt. He’ lucky to not be pilloried and crucified when you think about it. When you think hard about it its lucky that Hernando De Soto still lives and breathes.

In a better world Krugman would be George Reismans high-powered research assistant.

But the fact is that the award is formulated by bankers AAAAAARRRRRGGGGGHHHHHH (a woman screams).

And not just bankers. But Swedish bankers (a dozen women faint. Be ready to catch them, and ventilate them at both ends).

And so the fact of the matter is these guys don’t like Austrians. They don’t like right-wingers but they award the prize to right-wingers who don’t threaten them TOO much.

And they tend to give the prize to people who do statistical work, make new models, invent new concepts that get a bit of a hearing and become useful. And this sort of gear. They don’t tend to give it to people who just peel a little bit off the onion and bring the stronger light of human reason to the subject.

Now on those grounds, and in the department of pure statistical research, Krugman may well have been worth four Nobel prizes before he cracked the age of 30. He still retains the outer form of a library lizard who never really learned to socialise.

But one time, just after he left his workaholic stats life behind, he was my favourite economist…… I shit you not. 

I liked the earliest edition of his “diminished expectations” book. I had not been re-introduced to the Austrians at that stage. His crazed partisanship barely showed through…. and he had a knack for pulling apart problems in a pretty nifty way.


George Reisman sorted this really convincing inductive/deductive  derivation for the idea that real labour wages, must track real labour productivity…. Now that doesn’t mean that it isn’t a two way thing. In a perfect Austro-Capitalist world the productivity increase would drive the real wage increase no question. And implicitly Reismans analysis had capitalism as its backdrop. In making this analysis Reisman deep-sixed a doctrine dear to the Austrians. And that is the doctrine of the determination of wages via marginal revenue product. Now he pointed out some advantages with this doctrine but it didn’t make his pretty picky cutoff.

What Krugman did is he comprehensively, STATISTICALLY showed that wages track with labour productivity as Reisman had derived. He showed that this is statistically the case no matter what political system is controlling the territory. Now…….. in a really screwed system people are getting so gypped that cause and effect will probably be reversed. You force the aristocratic parasites to pay higher wages it is likely the case that they will have to invest in whatever it takes to make their serfs more productive.

Thats about as good as my epistemological insistence on CONVERGENCE!!!!! gets in the social sciences. This is one reason I have a soft spot for Krugman. On the one hand you have Reismans meticulous reasoning of why something should be the case. And then you have Krugman coming through with the statistical goods. Krugman coming through with the goods and showing that Reismans favoured doctrine IS IN FACT the case. And surprisingly showing that this doctrine works independent of the social system, country, time or place. To this day Krugman may not know who the greatest living economist (George Reisman) is???????????

Krugman apparently turned his statistical hand to many trade issues. To my mind his judgement is not good. But if the nobel bankers want statistical research acheivers than Krugman is their boy and was so when still a very young man.

Krugman was, and probably still is at Princeton. While he was at Princeton Krugmans head of department was a fellow last name of Bernanke. Recently Krugman spoke out against the Bernanke/Paulson (!@ #$%&) STEALING plan.

Once Krugman cut loose from being a library lizard, and stats-boy obsessive, he showed his congenital leftist side. In his first edition, of his first book, he had this nasty leftiness under wraps, but for a gratuitous taunt at Milton Friedman.

Krugman sticks up for serious economic science although on the inductive-deductive level he is not with it, him being a Keynesian. But he has stood up strongly against really bad popular-economics in his youth. And really shabby unscience in economics.

Krugman stood up strongly against the bank-thieving of his former boss. Krugman, though a sort of mummified leftist, who looks like he came out of the tomb in which he was doing mountainloads of statistical work …… Krugman though he looks this way has a good heart. He takes his science seriously. He is very sincere and willing to bash impractical leftists, with great righteousness, even as he bashes Austrians, through his lack of understanding.

He’s a bloke that has taken more abuse than he’s given. Fundamentally he is a good man. And for the implicit and unspoken rules of getting the Nobels he probably had acheived what was required by the age of 25.

I am happy that someone who has actually DONE one or two worthwhile things, has gotten the prize for the first time in years. I am happy for him personally. I wish him well and hope that the money and the reward for all that work in his twenties brings him a lot of happiness. I hope it makes his wife proud of him and happy and confident that she made the right choice.

For the love of God don’t trust his general judgement. But trust in the fact that he has done the hard yards and is, or at least was, a serious social scientist. He has my best wishes. He is far more deserving than the usual recipients.

In summary, he is a good and fine man by his own lights and no hypocrite, despite the left-wing mental handicap. And the best thing I can say about him is he is a SCIENTIST.  Not a science-worker but a SCIENTIST.

The left-wing mental handicap is a many and splendid thing. But Krugman is alright.

The right-wingers saw the danger and influence, that such an accomplished and venerated statistical-researcher, in the world of economics, could bring to the frontline scence, if his word became the new higher gospel. Hence he has been hammered far more than what the usual karma that one ought to get…… OUGHT to get…. for any ill-will, or venal motivation, of the heart.

I suppose his work as a young researcher was so exalted that the RIGHT-WING had to come down on him, like a tonne of bricks, lest he become some sort of national guru. And its not entirely clear that this wasn’t the right thing for them to do.

But this correspondent has no reason to believe that Krugmans researcher bona fides were not legitimate. Quite the contrary. I only wish his impressive skills had been in the service of George Reisman research projects.



  1. 13
    Jason Soon Says:
    October 14th, 2008 at 9:03 am
    wow a surprisingly nuanced piece by Bird on Krugman

    Jason. This ancestor-worship and telling the emporer what he wanted to hear has gone too far. And its cut loose on your own territory. You gave the bailout artists a fair stab at the wicket. But how do they treat things? Cambria was a sweet generous fellow just so long as his coterie was doing OK. But look at him now:

    JC. Says:
    October 14th, 2008 at 10:44 am
    How easy we forget that it was this twerp who suggested the congress not approve the bailout plan and wait until a new prez and congress is installed. His advice well have caused a depression. And he gets the prize.”

    I can abide with some notions of the historical Jesus. But I cannot abide with Cambria Mach 2008. Clearly you have had misplaced confidence in him. CL’s church teaches that all men are capable of good but I’ll not be convinced until JC has been in the desert 40 days and 40 nights in a crisis of repentence.

    Don’t admire these rich bankers. They are proven failures and welfare queens and JC’s attitude right now reeks of it.

  2. Obviously this fucker has gotten arrogant. Pride is supposed to go before a fall. But if the arrogant get on the public tit then the laws of the cosmos are perverted and bad karma escapes into the general nexus.

    Bring this pretender down. Whip him. Horsewhip him in the streets.

    Do you know that mob personalities when interviewed in prison now testify to the fact that counterfeit share-selling IS THE NEW DRUGS? Did you know that?

    Its a racket and Cambria “does not disapprove”.

    Its a racket and some of the kids who ride the bikes from the school told me that Cambria is an Italian. An ITALIAN?????? AN ITALIAN????

    The mob is into naked short-selling and the children telling me that Cambria is an ITALIAN!!!!!!!!!! (grrrrrrrrrr)

    Well I’m just scandalized.

    I don’t know what to think.

    But if we get this ponzi-shorter out on the street and whip him and whip him and horse-whip him like a dog…………. He might apologize about what he said about Krugman…………

    …… And just between me and you we might find out if this unspeakable rumour about Cambria being an Itallion has even the Scintilla of the shadow of the valley of TRUTH about-It.

  3. The nakedness of the short-seller. The lost millionairre wandering in the wilderness:

    “JC. Says:
    October 14th, 2008 at 12:31 pm
    Lets face facts, the bearded twerp got his academy because the NYTimes allows him to run a hate site and the Swedes like what he says. The chairman of the committee even confirmed it.

    Englund said Krugman was more than a great economist.

    “Not only is he a stellar researcher … but also he is an excellent expositor and that is clear both from textbooks but also, as many of you know, from his columns.”

    Seriously, it would be like homer winning the prize.

    Furthermore Krugman is intellectually dishonest and does the science and teaching of economics a disservice.”


    This Cambria is lost.

    This Cambria is lost like last christmas.

    But I am NOT a conspiracy-theorist so I will NOT abide this latest rumour thats getting about the traps the CAMBRIA…………… Is and ITALIAN!!!!!!!!!

    Those of you who belive, or are putting about this rumour I think it is time for you to PUT UP or SHUT UP.

    I’ve had my differences with Cambria. But thats one outrage I am simply not willing to hear.


  4. to think that you two used to be friends …

  5. The Christian church says we can never turn our backs entirely on our errant brothers Jason. And I have never been forlorn or lacking in optimism about our Muslim brothers…….. so long as their leadership lives in debilitating fear……..

    But this Cambria strains my notion of malice to none and charity to all.

    Because he has not come clean on shorting, ponzi-shares and ponzi-gold.

    And it is the case that you can never be a man until you come clean on these things.

  6. graeme
    you got me all wrong btw
    i’ve never said i supported the bailout wholeheardtedly.

    what i said was that I don’t believe nothing should be done because the world could sink into depression. the bailout is not the best emergency measure and has a lot of flaws as i understand, many economsts are against it but recommend recapitalising the banks. but i don’t believe we should do nothing,

  7. The dancing gigolo laughing at the rest of us”

    “That’s the way it is Bird. It’s Main street’s duty to bail out wall street: always will be and always has been.

    Ans birdie, they’re doing it in such a way so as to protect existing shareholders which means the stocks will rise even more.”

    Murder him and cut his body into small pieces. And let his heathen god have mercy upon his black heart…… but only if he fucking feels like it. Let him be the dinner of the dogs under the table of the heathen gods for this fucker is laughing at us and he knew it all along.

    Damn this fellow all to hell.

    Damn this ITALIAN all to hell.

    This ITALIAN……….


    I’ve said IT!!!!!!!!

    Fuck you Cambria.

    Don’t you be showing up where I am drinking every again unless you think a broken nose will give you faux-character.

  8. Bird;

    Will please stop it with the violence talk. Would you be happier if I was losing money then?

  9. No just point to a better world. I’m tainted with this fractrional reserve money as you point out. But I don’t base all things on wanting Kevvie to bail me out under a bad system/

  10. Bird

    Don’t be a moron. I don’t expect anyone to bail me out of anything. All I do is read the tealeaves and act accordingly, so please fuck off with your sermonizing and threats of violence.

  11. Well it’s gettin’ pretty racial here. JC’s Italian? Who’d a thought. I always figgered he was from Ouer Mongolia. In any case it could be worse. He could be Welsh. 🙂 .
    Now on with the JC/Bird debates –
    JC: Dumbarse Mick
    Bird: Thieving wog
    JC: Mick
    Bird: Wog
    JC: Mick
    Bird: Wog
    JC: Mick
    Bird: Wog
    Makes the US election seem almost civilized. 🙂

  12. Sorry Jason I forgot you…
    Mick wog mick wog mick wog mick wog mick wog mick wog mick wog. Chink!
    Do we have an African-American in the house? Jewish persons? If we can a couple each o’ those then we’ll have a full blown Lenny Bruce routine.

  13. again Hernando should probably get the peace prize……. even though Hernando isn’t a psychopathic killer (Arafat and others)
    Just outta interest Graeme, do you think Kissinger should’ve got the Peace Prize? I assume you think yes, but why?

  14. i warned you about that wog didn’t I cuz? who’s sorry now?

  15. No of course I don’t think Kissinger ought to have got the peace prize Adrien.

    Yeah you bet Kiwi. I thought I could reason him and turn him around. But it was becoming clear, to you at least, that the welfare queen was feathering his own nest and that he would be never willing to change his own act within an honest capital markets system.

    Its just incredible what this generation of bankers have done to us. I don’t think hardly anyone realises just how much they’ve brought the USA to ruin. Only mass-bankruptcies could prevent hyperinflation at this stage since the Americans will pay their debts off via monetization. There needs to be some monetization but only hand in hand with a phase-out of the ponzi-stuff.

    So they’ll take this monetization, without a reserve asset ratio, and they’ll do too much of it and there will be hyperinflation.

    The worst thing the American government can do is take over the banks debt.

    Libertarians try and blame the government. But this generation of bankers ought to be seen as one wing of the same counterfeiting racket. So we ought to take them together. Like you don’t seperate conceptually the Medici banking wing from the Medici political wing.

    Its pointless to think of American banking seperate from American government. Since these welfare queens are just recycling their bailout money to buy the politicians to pay the bailout. Buying the politicians takes considerably less than the trillions they are getting in subsidies.

  16. What I cannot get with is that we have to take capital away from small business exporters and energy producers and recapitalize bankers with it. These guys are just assclowns. They have proven themselves the greatest fantasists and most incompetent morons that ever got their hands on the levers.

    And we apparently want to recapitalize them?


    So they can lend more?

    Why the fuck would we want them to lend more? And waste yet more investment resources? We ought to put them in cages so they won’t lend any more.

    Bear in mind that I’ve already covered the issue of total spending. And I am fully aware that we cannot let total spending or money supply implode?

    But why would we recapitalize these drop dead losers so they can loan. Better to break their hands to stop them from loaning.

  17. No of course I don’t think Kissinger ought to have got the peace prize Adrien.
    Alright, I didn’t expect that.

  18. Also Kevvie is talking about guaranteeing their ponzi-loans so they can raise more money overseas. Why would we want them to do that for? So they can get us in debt and inflate our housing prices, while at the same time they destroy our exporters and worsen our trade balances?

    These guys are hurting and not helping our capital formation. Having a bad financial system is much worse than having no financial system at all since businesses can expand from reinvested earnings. So if the banks are not speeding up the growth of new small business than what are they good for? They are clowns I tell you. Welfare recipients and losers.

    Its a socialist monetary system as soon as we are saying that these clowns don’t need to live within their interest rate spread but instead can make vast profits from getting all the benefits of new money creation.

    And where has this socialist money taken us? Its been a disaster. Its been the ruination of The USA. And it could ruin us to.

  19. Adrien this is where you are going to have to think straight.

    Look at Humphreys. Just being a moron. He’s saying that the deficit must be good because it must be good. But what was the money our banks borrowed used for?

    It was used for their liquidity requirements as an afterthought to insure themselves after they had made all these ponzi-loans.

    Do you understand that?

    So this moronic position of Johns is just lunacy. He’s saying that the foreign debt doesn’t matter regardless of how the money was spent locally.

    The guys just a fucking moron. And you don’t need to listen to him. You need to think clearly and decide what makes sense.

    Once our banks lost their RAR, which should have been 100%. They no longer needed our deposits except as an afterthought. So they just lend away. They make the profit from new money creation rather than living within their interest rate spread. They no longer lend money for wealth creation since they don’t need money to be paid back quickly. So they use the loans for debt-addiction and asset appreciation.

    How is it an OK and fine thing to be indebted to foreigners on the basis of such activities.

    You see you get total idiots like Humphreys pretending to understand the situation when he knows nothing. So that forces you to have to wade through it and not be intimidated by his protestatioins that he has a degree and worked in treasury.

    Its nutjobs like him and his ilk who have lead us into this mess.

  20. This is the real problem with this subject. Its a dead easy subject. But for some reason when the subject comes up you get idiots like Humphreys and Mark Hill talking nonsense as if they are totally confident they understand matters when they have no idea at all.

    Thats what you have to watch out for. These stupid house-niggers acting like they know it all when in fact they are clueless.

  21. Notice Adrien that JC pointed out that the balance of payments always balances.

    What was his point?

    Yes the balance of payments always balances? But Adrien. What point does he think he’s making?

    This is the sum total of the intelligence of these welfare queen rent-seekers. You will find that pretty much everything he says is pointless or a lie.

  22. Remember what I said over at catallxy cuz?

    I’ll copy it here


    Because these rich guys like JC and Pommy and SOON owe their money to THE MAN.

    They’ve got too much invested in the current system – socialist fiat money, height restrictions, crony socialist infrastructure.

    See how SOON makes his living being like a protection agency for crony capitalists against big government? His income all depends on the crony capitalists fighting big government. Why would he want all this to stop? He’ll want to make a few changes here and there to protect his buds in the big end of town. But he wants the circus to continue.

    Same with Judas-JC who stabbed Christ (Ron Paul) in the back.

    Same with Regulator Reynolds.

    And that persecuting witch hunting parasite ZED.

    And see how pommy is a trader too?

    Traders aren’t authentic libertarians. They LOVE business cycles. They LOVE volatility. Thats how they make their living. Either that or flipping houses like Humphreys.

    Inflation, recession – it’s all manna from heaven to them.

    See the noble exceptions. TERGE can be a bit of a wuss but fundamentally he’s righteous because he’s in small business.

    These are your allies and the true libertarians cuz.

    Judas-JC has to be banished to the inner circles of Hell along with the other rich-guy faux-libertarians.

  23. Yeah well they are just going to talk Adrien into doubt by presenting this wall of sound where these losers, who didn’t see this problem coming, will all talk like they know whats going on.

    Deleveraging, the Cad spread, the balance of payments balances, the Japs have run out of local investments according to Humphreys, it just goes on and on their stupidity and none of them have a clue.

    Its just very sad to see whole countries ruined by this cluelessness and this pretense that these guys are free enterprise so anything they do is ipso facto good.

    When in fact they are socialist and most everything they do is hairbrained and tragic.

    Deficits must be good because they must be good is Humphreys logic. Then when challenged he’ll go into free-form creativity and decide that the Japs have run out of investment opportunities.

  24. the Cath’lic Church talke me into doubt. I’ve been living there ever since. Tomorrow I’ll come back and ask why these foreign investments (which are going down the toilet) protect us from the Crash.
    If our banking system is so sound as they all say it is. And if this isn’t our problem. Then why is this our problem.
    Straight answer.

  25. See these clowns aren’t giving you straight answers Adrien. You ask a question. And these idiots just say something that isn’t relevant. You have to shake these bullshitartists down.

    Look at Edney. He points out that some spread of the banks might have been cut in half.

    Why ought the banks not live within their spreads? If they can cut their spreads in half what does that mean? It means they can profiteer off a new round of money creation. So what is that going to acheive?

    Its just going to achieve more foreign debt and inflation.

    This is criminal behaviour. The banks must learn to live within their spreads or die.

  26. you were fooled by that rich wog weren’t you cuz? all he had to do was buy you a few drinks and you had the wool pulled over your eyes. just like the white man fooled the abos and stole the country off them

  27. Right. He was good capitalist while the asset prices were rising. And a crony communist once they started falling. Which of course means he was a crony-communist rent-seeking welfare queen the whole damn time.

  28. You see how the lying prick claimed I was advocating allowing an implosion of the money supply. Going out of his way to either fail to understand himself or to mislead others on what 100% backing is about.

    Ahura Mazda even Edney is showing some sort of glimmer of understanding of what it is about. But not Cambria. I guess once you go in for sharing ponzi-money, then its easy to trade in ponzi-gold, sell ponzi-shares and give ponzi-fake explanations for how honest money is supposed to work.

  29. you know that the inventor of the original Ponzi scheme was EYEtalian too cuz?

    Named after Charles Ponzi.


    Charles Ponzi (March 3, 1882–January 18, 1949) was an Italian immigrant to the United States who became one of the greatest swindlers in American history. His aliases include Charles Ponei, Charles P. Bianchi, Carl and Carlo. Although many people have never heard of Ponzi himself, the term “Ponzi scheme” is a widely known description of a system of fraudulent “make money fast” schemes promoted through the Internet and elsewhere to this day.

  31. “Coincidence?”

    I……………………… don’t…………………………….THINK!!!!so.

  32. “Tomorrow I’ll come back and ask why these foreign investments (which are going down the toilet) protect us from the Crash.”

    Don’t hold out on your commitments Adrien. Hound these lunatics. Why the bailout. Why guarantee all the ponzi-loans for THREE WHOLE YEARS if the system is so sound. One could imagine six months while reforms were going ahead. But a three year ponzi-guarantee. What the rest of us could do with such a printing-press guarantee. That alone ought to be enough to make a small fortune in a bottom-scraping market.

  33. check it out cuz
    they put Gruen in charge of innovation policy


  34. Oh my God. He’s just a complete jackass.

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