Another economics WTF:
A lot of you may remember my criticism of mainstream economics, that they become so detached from what is meant by a "good economy", that they advocate things that are positively destructive in this original, down-to-earth sense.
Scott Sumner, I find to be particularly guilty of this. His sound economic reasoning has led him to believe that what the economy vitally needs right now is for banks to make bad (or at least wasteful) loans, just to get money circulating and prop up nominal GDP -- a measure known to be meaningless because it's an artifact of the money supply and has to be adjusted for interpretation.
Fed up with him saying this kind of thing, I sarcastically posted this remark:
Yes, the economy will definitely collapse if the Fed doesn’t print up more money to make shoddy loans for purchases people don’t want, and it’s a shame that folks at the Fed are stopping Bernanke from such a wise action.
And in his immediately following comment, he said,
Silas, I agree. :-)
Huh?
You did actually paraphrase his position, so his agreement is a sign of self consistency even when things are not presented with his preferred framing. This much at least is a positive in my book.
As for the position itself... it is idiotic. What is the phrase? "Lost Purpose"?
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