Comments on: NYT Book Review of Krugman’s New Book Gets it Mostly Wrong

By: Ted Kaminski

Ted Kaminski — Tue, 19 Jun 2012 13:53:18 +0000

Italy’s problem is that it does not have its own sovereign currency to protect from currency speculators. The US sells treasury notes at around 1.5% because the bond “vigilantes?” see the US as a safe place to park savings. The price vigilantes will pay is their expectation of future inflation.

At 1.5% the expectation of inflation ain’t real high.

By: Misaki

Misaki — Mon, 18 Jun 2012 23:17:37 +0000

>Complaining about Paul’s exclusive focus on demand, the reviewer conflates the structural with the cyclical:

Was not the housing bubble the result of the government’s (or the Fed’s) desire to, well… increase house prices? And encourage borrowing to spend on consumption and so on. (As opposed to say, borrowing for leverage in investing in financial markets.)

If not for whatever happened during that time period, maybe inflation would have been “structurally” higher from 2001~2008.

Job creation without higher government spending, inflation, or trade barriers:
http://jobcreationplan.blogspot.com/

By: Jonathan

Jonathan — Mon, 18 Jun 2012 21:56:18 +0000

The best book reviews (reviews of fiction excluded) are actually essays on the subject of the book, putting the book’s contribution into context while informing the reader on the general subject.
This type of review is hard to find. It suffers from two problems: 1) by nature it will be long, longer than most outlets will publish, and 2) the writer needs to be knowledgeable about the subject in his own right. Ideally, the reviewer is someone who could have written the book himself.
My best source for this type of review is the New York Review of Books. That’s why I value the NYRB more highly than almost all of the many things I read.

By: EC

EC — Mon, 18 Jun 2012 21:16:36 +0000

END THIS DEPRESSION NOW! was also also reviewed, BTW, alongside Timothy Noah’s GREAT DIVERGENCE, by Reuters’ blogger Felix Salmon, earlier in the weekly NY Times:
http://www.nytimes.com/2012/06/13/books/paul-krugman-and-timothy-noah-on-the-economy.html

By: EC

EC — Mon, 18 Jun 2012 20:38:45 +0000

Technology and trade tends over several decades contributed significantly to retarding consumer income growth; credit compensated until the financial crisis knocked it out as a feed to demand, whereupon the building, up to that point latent, demand failure rapidly asserted itself.

This isn t, consequently, just Keynes’s liquidity crisis: fiscal stimulus can help, but if it’s not augmented by some approach to the structural problems of tech and trade and income inequality, it will fall short of restoring a post-war pre-Reagan-like economy. Krugman’s Keynesianism is naive and short sighted.

By: Tyler

Tyler — Mon, 18 Jun 2012 19:46:00 +0000

Even if the economy has recovered, new austerity will bring the next downturn.

By: Nick Batzdorf

Nick Batzdorf — Mon, 18 Jun 2012 17:34:27 +0000

The review is supposed to be about the book, not the reviewer. There’s always a subjective element, but the idea is to report facts as much as possible, with opinions qualified as opinions.

(I’ve been a magazine editor and writer about music and audio technology for years, and readers have always appreciated that approach to reviews.)

By: Understudy

Understudy — Mon, 18 Jun 2012 15:24:59 +0000

“His argument is not that investors’ sentiments don’t matter. It’s that they’re embedded in prices and can be followed on an hourly basis.”

Sure, except in the US, the Fed is buying bonds hand over first, while the ECB is constrained in doing that. So, the US can fund a deficit greater than 9% of GDP, while Italy with 3% is “on the edge”.

By: fausto412

fausto412 — Mon, 18 Jun 2012 15:11:53 +0000

I disagree with Bearpaw. Think about this…if the reviewer is an idiot and does a bad review that could keep the general public away from the book when the books logic and facts are sound and solid.

I’ve been reading everything Krugman since 2008 and I can see the flaws in that review. The reviewer himself is a Very Serious Person…he writes about the VSP view as if it has been correct thoughtout this crisis…and if the mainstream VSP view is on the same level of the view that a Krugman, Berstein, Delong, Stiglitz, Peter Diamond…and other big name economists who understand what is happening.

“To this Moderately Serious Reviewer, Krugman’s habit of bashing anyone who does not share his conclusions is not merely stylistically irritating; it is flawed in substance.”
This is one of the most irritating things to me. Somehow calling bs on bs is now the wrong thing to do. Krugman addresses this many times over the last 4 years. Notice too the reviewer used the faux VSP title MSR?

By: Bearpaw

Bearpaw — Mon, 18 Jun 2012 11:35:04 +0000

I think there’s a fine balance. If the review is knowledgable the subject matter, I think it’s reasonable to touch on any areas of disagreement. The review in this case — as Mr. Berstein points out — seems to be wrong on some counts, and making some illogical objections, but there’s nothing wrong per se with the angle of criticism. If I’m interested in a non-fiction book, it’s helpful to get some perspective on whether the information being presented is correct, as long as I remember that the reviewer isn’t necessarily right about what information they think is wrong.