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2011-11-18

Krugman om Rubicon och The Printing Press Mystery

Jag tycker jag får mer vatten på min kvarn gällande min kanske uppfinna-hjulet-på-nytt-insikt om att "Om man har en sedelpress går man inte i konkurs"

 John Plender at the FT seems mystified by something that has become obvious lately:

Bond vigilantes are only going after countries that no longer have their own currencies.

Part of the answer is that countries on the euro are stuck with a severe competitiveness problem that can only be resolved with grinding deflation, making their debt problems worse.

 On top of that, however, is the proposition that countries without a printing press are subject to self-fulfilling crises in a way that nations that still have a currency of their own are not.

The point is that fears of default, by driving up interest costs, can themselves trigger default

Read more here

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