Robert Waldmann fisks R & R's letter to PK.
First off, RW:
"Yes their debts are not denominated in a currency of their own. The pattern is clear – borrowing in Euros is risky as is borrowing in dollars for countries other than the USA. Following DeGrauwe (and I’m sure countless others) Krugman has repeatedly stressed the difference between debts in a currency the debtor can print at will and debts in other currencies. Let’s see if R&R ever mention the fact that debts in the eurozone are denominated in Euros."Robert's Stochastic thoughts
The Letter to Paul Krugman
Robert Waldmann
At Angry Bear, What Reinhart and Rogoff should do now
Reinhart and Rogoff could and should have said “Paul Ryan, you know nothing of our work” (obligatory Annie Hall reference). They did not. They still can. I think they should. His claims have no basis in the evidence and all reality based people should say so.
"the difference between debts in a currency the debtor can print at will and debts in other currencies"
ReplyDeleteThis is weak.
The word "authority" should appear in this sentence somewhere imo ... if we use the weak language via the word "print", it leaves it open for derision by the libertarians... rather than confront the libertarians we leave it open to derision...
rsp,