Economist Hans Hermann-Hoppe rips Paul Krugman on Money Printing 01-10-13

If printing pieces of paper creates wealth, why, Mr Krugman, does poverty exist?

[BrianMartensMusic]

It's rather simple really for Krugman. He goes to the Federal Reserve, raises his wand, and says "Wingardium Leviosa" to the money supply.

[JLuz]

If wealth is dollars, or the value printed on paper money, by that assessment, is Zimbabwe the richest country on Earth then?

[Samsgarden]

It makes the first users of new money richer.

[bandholz]

While I support Austrian economics, printing dollars can create wealth. Effectively, the printing of dollars creates inflation which steals money from those who get it last to those who get it first. By having a small gradual inflation, the central banks are requiring that individuals must work harder / longer to maintain their wealth. This increase of work would improve the wealth of society as a whole.

[aarvark]

A child might say this but nobody who understands economics would. Dollars are a representation of wealth. They have no value of their own. Printing dollars does not increase wealth. Technicalities are fine as long as the initial premise is true. When you start out with an assumption that is blatantly false, there is no reason to look at the technicalities. Ask Zimbabwe if printing money made them wealthy. Their dollar went from on par w/ US to 100 trillion dollar notes that are worthless.

[BrianMartensMusic]

He is an economist, and unfortunately the public believes that he is also a good economist and a good man, but he has consistently abused his power as a nobel laureate. He has become the policy entrepreneur that he wrote about to begin with in peddling prosperity.

[Cornampoo]

If you cannot explain it simply, you do not understand it well enough. - Albert Einstein

[jdhfyuhu]

Do you have a link to the whole video, or know which event they are at?

[charliemurphy]

I'd say 'increasing the money supply makes people richer' is definitely a strawman. Anyway, the question is in no way easy to answer, since there are many differing perspectives within the mainstream, and the effect of monetary expansion depends on the several variables. The simplest way to explain the intuition would be through IS-LM, but that is by no means satisfactory. Anyway, I'm done arguing on youtube for today.

[omgiheartpie]

That's not what I'm saying. You're right, you can't create wealth by continuously printing money. But there are economic conditions under which printing money can create wealth. Example: Recessions. If velocity of money is slowing during a recession, the central bank can print more money to offset the fall and increase employment&output. You seem to be thinking Krugman advocates printing money and running deficits all the time; but that's a lie anyone can refute by doing a simple google search.

[PenguinProseMedia]

I will look. Try Mises Institute Channel/website.

[omgiheartpie]

But he did my friend. He foresaw the nasty housing bubble and pointed it out in mid 2005. He even harshly berated Greenspan for not taking action and being complacent.

[momoyang]

"explain to me why is there still poverty in the world?"

because other part of world has production problem, while US/Europe/Japan have demand problem. Our economy can produce much more than what we can can consume. As the end results, someone will be unemployed even if they want to work.

[ManiTati]

Nobody says "printing money" creates wealth. It may only stimulate more economic activity

[souravgh]

Not really, the "other part" is where most of the production is happening right now, while the US/Europe are doing the "consumption" with the help of
debt.

[simonvmentvm]

That page is from 2010, so it's a different one. I think this video was from the 2012 conference.

[charliemurphy]

It is very important in these replies to people like Eratosthenes, that we don't get involved in technical details but ask some questions ... almost like a child:

'Explain to me how the Earth can possibly be spherical?'

'If that is the case, why can't we see it's curvature? Wouldn't people on the underneath fall off into space? Don't you think that the continents, that the world as a whole would simply slide to the bottom and drop off?'

I am sure the guy cannot answer this type of question!

[scineram]

There is certainly no need for Hoppe to pretend he is an idiot.

[AFRIKTODAY]

He is as much an economist than I am a nuclear physicist! The real issue is that he was awarded a Nobel prize and I, for the good of humanity, has never red a book on Nuclear physics!

[jdhfyuhu]

You probably saw, but I found it at the Property & Freedom Society. it is posted to their vimeo channel called - Day 2 Question & Answer Session, PFS 2012.

thanks :)