Monetary Theory

Government spending merely directs scarce factors of production away from their most productive uses.

The Keynesians have no leg to stand on.

"The beauty of an auction is that it's a very clear and simple example of what goes on every day in a free market — buyers and sellers meeting to negotiate a price."

In Krugman's world, prosperity is created by spending, and it does not matter who spends what on whom just as long as someone is spending.

Any audit that exposes the Fed's relationship to the state will be worth doing, even if the Fed's friends keep it where it is.

Remember the flight to "safety" into T-bills and T-bonds? Most people fled from hard assets. These are the victims. They believed the propaganda of the establishment.

As things stand, central banks' monetizing government debt is presumably the way forward for producing inflation — which is, and must be, defined as a rise in the money stock.

The entrepreneur takes calculated risks, and typically "builds" using the carpenter's rule: measure twice, cut once. If it does not make financial sense to build, the entrepreneur will not do so. In addition, the entrepreneur would later know — through the profit-and-loss mechanism — whether such a decision was prudent or foolish.

Artificial credit created by a deceptively low rate of interest leads to speculative bubbles.

Krugman. 2002. Calling for a housing bubble.