Paul Krugman: Ron Paul ‘Understands Nothing’ About Money

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Since Ron Paul is surging in the polls, Paul Krugman has decided to go on the attack. Since the official rate of inflation is relatively low right now, that is “proof” that everything Dr. Paul has been saying about the economy is wrong and that Krugman is right.

Now, Krugman has struggled to explain why commodity prices have continued to climb (although they have temporarily fallen from their “historical highs” in the last half of the year), resorting to what I call the “Jake Blues Theory” of inflation, in honor of Jake’s set of mutually-exclusive excuses while explaining to his girlfriend why he left her at the altar. Commodity prices could NOT have risen because of anything Ben Bernanke is doing at the Fed. Oh, no! They are rising because of demand from “emerging economies,” volatility (yes, “volatility” explains nearly everything), and aggressive marketing of gold by Glenn Beck. None of these explanations makes sense, but who cares when one is the favorite columnist for the NY Times?

5:11 pm on December 14, 2011