Two months ago, on May 16, the great French economist Pascal Salin celebrated his 70th birthday. I first met Professor Salin in late 1997, in his office at the University of Paris-Dauphine. When I mentioned that I had been drawn to the Austrian School not least of all because of Mises’s epistemology, he raised his eyebrows and put on a skeptical face. I stopped talking and he threw in with amusement, “And all of economics is for you nothing but applied epistemology.”

Here is Paul Krugman from his blog trying to deny that he was a persistent advocate for the housing bubble and below that are quotes from him just prior to the bubble taking off. ht Benjamin Lee
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“And I was on the grassy knoll, too”

One of the funny aspects of being a somewhat, um, forceful writer is that I’m regularly accused of all sorts of villainy. I was personally responsible for the demise of Enron; my nonexistent son worked for Hillary; etc.. The latest seems to be that I called for the creation of a housing bubble.

MSNBC’s list of metro areas that are no longer “contracting as seriously as six months earlier” (is that really good news?) consists of 23 of 381 spots on the map. The trouble is that most are capital cities, and it is not hard to speculate why. The interactive map provides an interesting picture of nation’s economy sinking and sinking.

Paul Krugman, who tells us that assets and capital are homogeneous when it comes to economic policy, suddenly claims that there were malinvestments during the boom! (Actually, he does not use the M-word, as he would not know what it means, but I digress.)

The Great One writes:

The business of political capitalism, that is. Like Enron, Goldman operates primarily in the nebulous world of public-private interaction. It is the US’s most politically powerful financial firm, skilled at navigating the byzantine regulations governing the virtually nationalized US financial sector.

One can not help but find what is perhaps the strangest news story of the day a bit prophetic. A man in north Texas received a $23 quadrillion Visa bill. The charge was made at a restaurant in Dallas. Obviously this was a computer error and this gentleman didn’t run up 200 times the national debt on his visa.