Is he really this stupid?

One is to pretend that there is any future for monetary policy in the timescale Labour now need to be concerned about. There isn’t. Carney says he can see three interest rate rises in the next three years. I would call that optimistic. But at best that means rates will reach 1.5% before, inevitably, crashing to zero again. In other words, any policy (including putting the central bank at the core of economic policy) based on neoclassical thinking which, as Michell confirms, puts monetary concerns at its core is simply irrelevant.

What are low interest rates if they’re not monetary policy?

16 thoughts on “Is he really this stupid?”

  1. And another thing…

    From the comments at NS’ link, this one from RM had me scratching my pate: “Krugman has many weaknesses – he would not have got the Nobel without doing so.”


  2. If it doesn’t matter whether interest rates are 20% or 0.2%, they’re irrelevant. if it’s important they be low, because it would be damaging to make them high, they’re relevant even if they are kept low. Anyway, try a year under Chancellor McConnell and all bets are off.

  3. Candidly, Yes

    A good comment from one ‘Mike Parr’ sprung out at me:

    ‘Difficult issues such as climate change and the actions needed to combat it, require that commentators have knowledge, understanding and some level of expertise.’

    Doesn’t this by definition exclude Murphy from a role in the discussion of anything, by definition as he has not got even the vaguest clue about economics or finance?

  4. “After a few days of fairly frantic blog activity, I trust I will be excused a quieter day, not least because work has got in the way…” Richard Murphy.

    No. Really, Fuck me, isn’t he receiving EU money and isn’t he supposed to be working for it?

    How many hours a day must be spend on that blog?

  5. “It took me a little while to realise I am what is now called a Modern Money Theorist.”

    As you say Noel, Spud phrases it as “I see other people have caught up with my theories and given them a name”


  6. Betteridge’s Law still applies.

    “Is he really this stupid?”

    No, no, no. He is far more stupid than that.

  7. How many hours a day must be spend on that blog?

    Like a mains sewer pipe his output is prodigious, but given the inane and incoherent nature, not to mention contradictory, I don’t think he agonises over every word and well tuned phrase.

    His stream of unconsciousness is limited only by his ability to bash a keyboard. God help us when dictation tools can keep up and render intelligible prose.

  8. Roll up, Roll up – get a degree in murphonomics. No prior qualifications needed – only one textbook to be read- the joy of potato. . Taught by a real Professor*. Sycophancy guarantees results.

    *not really.

  9. I never liked Lamont but I, unlike Murphy, do not deny that he existed.
    So the maximum change in Bank Rate is not 0.5%
    Murphy is, as usual, lying.

  10. Rob said:
    “God help us when dictation tools can keep up and render intelligible prose.”

    Computers will have to be much more powerful before they can make Murphy’s prose intelligible.

  11. Ragging on Ritchie, Simon Wren-Lewis edition:

    “Which brings me to Richard Murphy’s post. Richard says so many false things about this [Labour’s fiscal policy] rule it is difficult to know where to start. It is not ‘neoclassical’, it does not ‘have its roots in microeconomics’. It does not assume ‘markets allocate resources efficiently’. It does not make any assumptions about how money is created. To say that Labour’s rule is based on a microeconomics perspective but MMT has a macro perspective is complete and utter nonsense. You can justify Labour’s rule on the basis of pretty well any macroeconomics you like, as long as you accept that interest rates are stabilising the economy rather than fiscal policy.

    The bottom line is that Richard tries to suggest that you could have more public spending under an MMT type assignment compared to Labour’s fiscal rule. That is also completely wrong, and if anything the opposite would be true. Suppose Labour comes to power in 2022, and nominal interest rates by then are at 2%, and inflation is steady at target. Labour are pledged to substantially increase public investment spending (which is outside the rule), which will put upward pressure on demand, at least initially. That would mean under a conventional assignment interest rates would rise to prevent inflation. But in an MMT world that wouldn’t happen. So in an MMT world how do you stop inflation rising? Either current spending would have to be cut, or taxes increased.

    There is only one way that public spending for given taxes could be higher in an MMT world compared to Labour’s fiscal rule, and that is if inflation was not controlled at all. That is not what serious MMT economists would recommend. So when Richard says Labour’s rule means a Labour government would be committed to austerity policies, by which I think he means low public spending, while his MMT alternative would allow more public spending without raising taxes, he is, once again, just wrong.”

  12. @ Revd Spooner:
    “From the comments at NS’ link, this one from RM had me scratching my pate: “Krugman has many weaknesses – he would not have got the Nobel without doing so.”


    Fuck me… Having looked at his post I *think* he is saying that in order to get a Nobel prize in economics you have to have flaws, implying that the Nobel prize committee are themselves flawed. Murph of course is better than all of those awarding or getting Nobel Prizes.

    That is how I am reading it.

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