Hugh at Corrente has a piece on Paul Krugman:
What I find so aggravating about Krugman is how he generalizes and cherrypicks his data to fit his conclusions. To understand the game he is playing here, you really need to work backward from his end purpose. He wants to absolve his mentor and buddy Ben Bernanke and by extension the Fed from commodity price inflation. Ergo he must downplay the effects of speculation because such speculation would be based on the Fed's easy money policies. So he evokes finite planet and world markets, etc. But that's asking a lot. Because if the Fed isn't providing the wherewithal to blow a bubble in commodities, then Krugman really needs to argue that it isn't blowing one in stocks as well. Yet do any of us really think that the year and nine month old stock rally actually reflects anything in the fundamentals? If it's not a bubble, what is it?
Krugman also doesn't explain why if we are experiencing inflation in commodity pricing why we aren't seeing inflation more generally. This is where I think Krugman is being stupid, dishonest, or both. There have been a lot of us out here writing for some time how Fed and Treasury policies have not been directed toward helping the real economy but have instead financed and facilitated bubbles in stocks and commodities. The result is exactly what we see. The overall economy is going deflationary at the very same time we see inflation in stock and commodity pricing. The real economy continues to deflate as reflected in the fundamentals: housing, debt, unemployment, state budgets, etc., but not in the financial sector which is being kept pumped up by the Fed. For ordinary Americans, this is the worst of both worlds. We see our economic prospects deteriorate, houses lose value, pensions go bust, even as we have to pay more for basics, that is commodities, like gasoline and groceries.
I just get so freaking tired of Krugman playing these dumbass games, protecting his friends, defending the kleptocratic Establishment to which he belongs, and selling this tripe as some kind of fair and objective analysis. When push comes to shove, Krugman stands with the kleptocrats. That's all we really need to know.
This is C.I.'s "Iraq snapshot" for Tuesday: