Earlier today, I looked at the latest claim by Paul Krugman, who echoes Ben Bernanke’s fiction that savings by those evil, thrifty Asians are at the heart of the current crisis. Well (hat tip to Felix Moreno), it seems that Robert Murphy was on to this scam a while back.

In fact, Krugman is not the only one to fall for this hokum, as Murphy wrote his article to answer claims by Tyler Cowen, Jeff Hummel, and David Henderson. Furthermore, when one combines Murphy’s points with the many statements that Peter Schiff has been making, we see that the Austrian Theory of the Business Cycle really does have explanatory power. The idea that a “glut” of savings by Asian has created an economic crisis really is silly on its face.