Paul Krugman, one of the greatest opponents of the Austiran school, thinks that gold prince increased all because of speculation from Glenn Beck. It's probably the most ridiculous thing I've ever heard (source).
This if course outlines the difference of how Keynesians and Austrians see inflation, the other seeing it as something to do with prices while the latter seeing inflation as something to do with the quantity of money and credit.
Of course Krugman doesn't think that the trillions of dollars printed since 2008 and injected into the economy like steroids have nothing to do with the price of gold. He doesn't seem to be even considering the euro crisis, a direct example of a failing fiat currency and authority to control interest rates and manage the economy.
Peter Schiff Wonders What Krugman is Smoking
You know Peter Schiff predicted the housing bubble and the recession. Why not just search YouTube for "Peter Schiff" was right (maybe I'll blog about that soon). So when it comes to credibility, will you believe in someone who has been spot-on before or someone who thinks that a TV show host like Glenn Beck (I don't watch his show by the way) affects the price of gold drastically.
I guess Peter Schiff will be saying the same thing about what Krugman is ranting about with the gold price. Again, it doesn't have to be gold, it's just that it is what the market has dictated for centuries. It's like economic law. It has all the perfect qualities to be legal tender. If Krugman and any of his other "liberal"(not in the classical sense) followers really think that currency backed by gold makes no sense then why won't they just allow competition? If they trust is paper money so much then they won't have anything to worry about, right?
But hey, all he really wants to do is break a bunch of windows so that it will create jobs and boost GDP. Smart, huh?
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