Friday, January 9, 2009
Coining a New Term for the Coming Economic Disaster
OK kids, I think we are in store for a very severe recession (i.e. depression) and very big price increases. It will be stagflation but worse. So we need a catchy term. The two contenders I've come up with are infression and depflation, but the first is hard to pronounce and the latter is very easily confused with deflation. Any thoughts? Should I just punt and go with hyper-stagflation?
Comments:
It has to include an allusion to Krugman. He writes it in his blog or in his column and like a puppet show it works it way up his arm, through Obama's rear end and flaps the mouth of the Prez-elect.
Krugflation.
Krugflation.
The Blackadder Says:
I'd go with hyper-stagflation. People know what stagflation is and they know what hyper-inflation is, so if you say "we're in for hyper-stagflation" they will immediately understand what you're talking about. Infression and Depflation, on the other hand, require you to think about it and would probably just leave lots of people confused.
I'd go with hyper-stagflation. People know what stagflation is and they know what hyper-inflation is, so if you say "we're in for hyper-stagflation" they will immediately understand what you're talking about. Infression and Depflation, on the other hand, require you to think about it and would probably just leave lots of people confused.
I have to agree with The Blackadder: hyper-stagflation sums things up in a nutshell and is less likely to be confusing to people. Inventing an entirely new word means that you'll probably have to define it all the time for new readers.
Murphcession.
No, just kidding, I think something that incorporates Krugman's name is most appropriate.
No, just kidding, I think something that incorporates Krugman's name is most appropriate.
Stagflation: The Chicago Edition or, continuing with the Star Wars theme, Stagflation: The Chicago School Strikes Back or if you think the new public spending as a cure deserves more weight than the monetarist cause; Stagflation: Return of the Keynesians. Actually perusing the Star Wars titles they all could work in some way.
The Blackadder Says:
Krugflation, obviously, is when the government deliberately induces hyper-inflation to prove that it's credible in the fight against deflation.
Krugflation, obviously, is when the government deliberately induces hyper-inflation to prove that it's credible in the fight against deflation.
I would refer to this present period as the “dilution depression” which ties into my general insistence upon using the term “dilution” to describe the actions of the central bank. In any forum aimed at the general public, I would use the term “dilution” or “monetary dilution” to describe the actions of the Fed. (If you have time, point out that the Fed is an unconstitutional and illegal entity whose primary purpose is to dilute the currency.
The basic Austrian School insights are not that complicated. However, the eyes of the public will generally glaze over upon hearing words like “creation of new fiat money” and “dollar depreciation” which cover two separate but related concepts. The word “dilution” covers both concepts: 1) The act of the Fed in diluting the money stock by creating money and credit out of thin air; and 2) the insidious result of the action of the Fed, the dilution of purchasing power. Which, of course, leads to inflation as the public now understands it, the general rise in prices.
“Dilution” has the additional benefit of not being a neutral term as it suggests something nefarious. Further, once the dilution concept is understood, it is an easy second step to explain that the dilution of purchasing power comes from the “theft” of your purchasing power directly by the people who receive the new money first but who did not actually earn it. Then you can throw in how easy it is to understanding how monetary dilution totally screws up the price system in both the short run and the long run. How can anyone build a giant factory to create employment under such conditions?
If in a debate on TV with a Keynesian, you probably have about 20 seconds to explain yourself. Let the Keynesian try to explain away your description of dilution. And your response to the Keynesian can always be that all the Keynesian proposes to do is to further dilute the money supply. Finally, if you have time, remind everyone that Hayek said that Keynes told him that Keynes’ “General Theory” was in effect a ruse to lower British wages rates without the workers knowing what hit them. There’s your “stimulus” to cure unemployment, Mr./Ms. Keynesian, nefarious money dilution to lower wage rates.
The basic Austrian School insights are not that complicated. However, the eyes of the public will generally glaze over upon hearing words like “creation of new fiat money” and “dollar depreciation” which cover two separate but related concepts. The word “dilution” covers both concepts: 1) The act of the Fed in diluting the money stock by creating money and credit out of thin air; and 2) the insidious result of the action of the Fed, the dilution of purchasing power. Which, of course, leads to inflation as the public now understands it, the general rise in prices.
“Dilution” has the additional benefit of not being a neutral term as it suggests something nefarious. Further, once the dilution concept is understood, it is an easy second step to explain that the dilution of purchasing power comes from the “theft” of your purchasing power directly by the people who receive the new money first but who did not actually earn it. Then you can throw in how easy it is to understanding how monetary dilution totally screws up the price system in both the short run and the long run. How can anyone build a giant factory to create employment under such conditions?
If in a debate on TV with a Keynesian, you probably have about 20 seconds to explain yourself. Let the Keynesian try to explain away your description of dilution. And your response to the Keynesian can always be that all the Keynesian proposes to do is to further dilute the money supply. Finally, if you have time, remind everyone that Hayek said that Keynes told him that Keynes’ “General Theory” was in effect a ruse to lower British wages rates without the workers knowing what hit them. There’s your “stimulus” to cure unemployment, Mr./Ms. Keynesian, nefarious money dilution to lower wage rates.
This being the blog of a decent person, I will not publicize the descriptive phrase I would choose based on how it is going to feel for the majority of Americans.
Hyper-stagflation will suffice.
Hyper-stagflation will suffice.
"WTF".
Most people know what it means and it clearly expresses the emotions of alarm, astonishment and maybe fear that most people will experience when the full scale of the oncoming storm hits them.
Maybe its not revelant to you Austrian economist chaps as you have been predicting sthg like this for donkeys years, but you could use it in an ironic way.
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Most people know what it means and it clearly expresses the emotions of alarm, astonishment and maybe fear that most people will experience when the full scale of the oncoming storm hits them.
Maybe its not revelant to you Austrian economist chaps as you have been predicting sthg like this for donkeys years, but you could use it in an ironic way.
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