STOCK MARKET WATCH -- Monday, 2 April 2012

[girl gone mad]

42. An Online Debate Between Paul Krugman And Steve Keen Is Turning Ugly

Krugman has lost the plot here. This isn't merely a theoretical debate. There is plenty of empirical evidence than Keen's description of modern banking is entirely accurate. Not sure why PK has dragged this fight on, but I'm glad the Post-Keynesians are getting some attention.

The ultimate Neo-Keynesian and the ultimate Post-Keynesian are trading blows on their respective blogs right now.

It all started two weeks ago when Steve Keen published claimed that Paul Krugman didn't understand Hyman Minsky and his warnings about debt. They've exchanged half a dozen posts since then, but we'll skip to the latest insults.

KEEN: Reading what Paul Krugman is saying about banking feels like reading a Ptolemaic Astronomer describing sunrise today as if that’s actually what’s happening. He is dismissive of the view that banks can “create credit out of thin air”—so dismissive in fact, that anyone unacquainted with the empirical evidence might be fooled into believing that his case is so strongly supported by the facts that it’s not even worth the bother of citing the empirical data that backs it up.


KRUGMAN: Oh dear. Nick Rowe sends me to Keen’s latest... Nick uses a four-letter word to describe this; I can’t, because this is the Times.

Read more: http://www.businessinsider.com/krugman-fights-keen-2012-4#ixzz1quK8YiMw