Tuesday, October 20, 2009

Horn tooting

Mish-Krugman-ECRI

Last week, blogger extraordinaire Mish put out an
excellent critique of ECRI’s recent record. As I was reading it, I thought to myself: this is very similar to what I wrote back in the summer (original and with ECRI comment). Then, I saw that Mish gave a hat tip to this blog (thanks!). He went even further than I did, and did an excellent analysis.

Apparently, Paul
Krugman thought so too. While I often disagree with Krugman’s interventionist approach, I can not deny that he is a brilliant person and a Nobel prize winner. To see Krugman, the leading Keynesian of our day, agree with Mish, a strong proponent of the Austrian school is quite unusual.

Once the Mr. Krugman got into the game, ECRI had to do damage control, as it is doesn`t want Nobel prize winners questioning its calls or model. Any doubts about its calls or model can seriously hurt ECRI’s business, especially when that doubt it sowed by one of the preeminent economists of our day.

So
ECRI put out a statement contradicting Krugman.

The Big Picture then commented.... Not sure, how it happened, but this little blog managed to write a piece that got the ball rolling and indirectly caused comment by a Nobel winner, 2 top bloggers and a top economic forecaster.

The funny thing is ECRI should be sitting pretty right now, as its April call for a strong economic recovery is being corroborated by the stock market which hit a new high this week. This doesn’t mean that it will ultimately be a good call, or that I agree with it. To ECRI`s credit, they came out boldly and early with the pronouncement.

Also, notice how none of this discussion took place in the mainstream media (unless you count Krugman’s NYTimes blog).

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