Thursday, May 27, 2010

FLG Always Thought

Dennis the Peasant is too hard on Matt Yglesias, but this is some stupid, idiotic, moronic, fucking dumbass writing on economics:
You can’t talk China and the economy without talking about the exchange rate issue. And thinking about it has got me pondering some questions. For example, insofar as the Chinese want to insist on pegging their currency why do they have to do it in this way? My understanding is that the peg doesn’t just operate automatically. It needs to be defended with a combination of capital controls and active measures. Specifically, the Chinese government spends a ton of money every year buying up U.S. financial assets. But couldn’t they just buy something else? They could order planes from Boeing and sink them into the ocean—that would accomplish everything the Chinese want to accomplish, but also create jobs.

If you stop and think for, I dunno, a fucking millisecond it should come to you why China would rather buy a bond that pays interest, even small amounts of interest, and can be sold in a very liquid market rather than wasting the money by sinking goods they just purchased in the ocean. I realize this is a contrived example that's meant to be somewhat silly, but come on.

Are we sure Matt graduated from Harvard? I've never doubted it before now, but this must be very high in the rankings of stupidest things ever said by a Harvard grad.

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