Paul Krugman

Paul Krugman @paulkrugman

So far they don't, although when we get numbers for June they may not reflect the recent downshifting in expectations. In particular, retail gas prices didn't peak until mid-June 7/ https://t.co/VepIpM7bnc — PolitiTweet.org

Paul Krugman @paulkrugman

Now, bond markets don't set wages and prices, so what we really want are the expectation of people who do — which could in principle be different. Consumer surveys like Michigan and NYFed still don't quite get there, but it would be worrisome if they told a v different story 6/ — PolitiTweet.org

Paul Krugman @paulkrugman

To emphasize for the MMXXIIth time, not saying that the markets are right, only that they show no sign of expectations of inflation getting entrenched, which is what you need for stagflation 5/ — PolitiTweet.org

Paul Krugman @paulkrugman

Looks like this. The 1X5Y number is consistent with the Fed's 2 percent target for PCE 4/ https://t.co/ailGCsgCCF — PolitiTweet.org

Paul Krugman @paulkrugman

And even the 5-year number exaggerates the problem: it's front loaded, with a lot of inflation expected in the near future. I've been doing this informally, but ICE is explicitly calculating expected inflation over the 5 years after next year 3/ https://t.co/sFNq5IXQdT — PolitiTweet.org

Paul Krugman @paulkrugman

Market expectations of inflation are way down — and remember, Ackman was talking about the market, not consumers or businesses 2/ https://t.co/x3ZmImOpWR — PolitiTweet.org

Paul Krugman @paulkrugman

This was just 6 weeks ago. Even then the data didn't support these claims. But not sure people realize how dramatically the runaway inflation narrative has now collapsed 1/ — PolitiTweet.org

Paul Krugman @paulkrugman

Clearly not corrupted by woke math — PolitiTweet.org

Paul Krugman @paulkrugman

I predicted this a while back https://t.co/2pI4I5uHfi — PolitiTweet.org

Paul Krugman @paulkrugman

What this means is no need for a Volcker-style painful disinflation. Get demand back in line with supply — which Fed tightening is doing as you read this — and inflation will come back in line. This episode is starting to look ... transitory 4/ — PolitiTweet.org

Paul Krugman @paulkrugman

Clearly, it isn't. And with commodity prices plunging — wholesale gasoline down almost a dollar from its peak — it seems hard to see how that happens 2/ https://t.co/EWa89wGI0i — PolitiTweet.org

Paul Krugman @paulkrugman

Nobody gets this, no matter how many times we explain it — but the point is NOT that the market knows. Clearly, it often hasn't. Instead, we're talking about whether continuing inflation is getting entrenched in expectations. the way it was in the 70s 2/ — PolitiTweet.org

Paul Krugman @paulkrugman

Well, Mr. Market seems to have decided that stagflation isn't happening after all 1/ https://t.co/49jmrg0Ajw — PolitiTweet.org

Paul Krugman @paulkrugman

Why did the chicken cross the road? Alternate side of the street parking regulations — PolitiTweet.org

Paul Krugman @paulkrugman

Don't grade terrible Supreme Court decisions on a curve. The EPA ruling could have been worse, but was awful nonetheless https://t.co/V6aSgEoSp8 — PolitiTweet.org

Paul Krugman @paulkrugman

I doubt many people at the time would have described 1976 as a serene year for America. And maybe my own relative serenity reflected being, you know, 23. But from today's perspective it seemed much less scary than the world we're living in now 9/ — PolitiTweet.org

Paul Krugman @paulkrugman

At the party the ambassador read a message from Gerald Ford, nobody's idea of a great president but a decent man — and this was also not that long after Watergate, which many of us felt had proved the strength of US democracy 8/ — PolitiTweet.org

Paul Krugman @paulkrugman

And yet I don't remember anything like the sense of dread we feel now. That all-Western party was kind of a reminder that despite everything the US was the leader of a flawed but real free world 7/ — PolitiTweet.org

Paul Krugman @paulkrugman

And the fall of Saigon was still fresh in memory — a lot of nervousness about America's role in the world. Henry Kissinger thought Portugal would go Communist 6/ https://t.co/GYHMqCGqrv — PolitiTweet.org

Paul Krugman @paulkrugman

The US was keeping a low profile in its efforts to support democracy — much too close to our role in overthrowing Allende (lots of graffiti saying "Death to the CIA", although sometimes with an addition, in fresher paint, saying "and the KGB") 5/ — PolitiTweet.org

Paul Krugman @paulkrugman

The US embassy threw a 4th of July party in a park overlooking the river Tagus — somehow they even scrounged up hot dogs. To fill out numbers at the party, a lot of people not connected to the embassy were there — basically it was an all-Western-embassy affair 4/ — PolitiTweet.org

Paul Krugman @paulkrugman

The late Miguel Beleza, who would later have several important govt positions, Andy Abel, Jeff Frankel, and me at 1/3 my current age 3/ https://t.co/5yanjxEw1w — PolitiTweet.org

Paul Krugman @paulkrugman

In 1974 Portugal had overthrown its fascist government, and in 1976 was in the early stages of trying to become a modern democracy. The economy was wobbly, and I was part of a group of MIT grad students who spent the summer working at the central bank 2/ — PolitiTweet.org

Paul Krugman @paulkrugman

Earlier this year I took a bike trip in Portugal, and on this 4th of July I find myself remembering the bicentennial, when I celebrated the 4th in Lisbon. No deep insights, but maybe a sense of how the world has changed 1/ — PolitiTweet.org

Paul Krugman @paulkrugman

And I wish I could say that I was sure enough about the West's resolve to be confident that this strategy will fail 10/ — PolitiTweet.org

Paul Krugman @paulkrugman

My guess is that it's political, aimed not at UKR but at the West. Capture worthless ground and randomly kill civilians to create the appearance that Ukraine is gradually losing, so that Western "realists" get the upper hand and cut off the supply of weapons 9/ — PolitiTweet.org

Paul Krugman @paulkrugman

RUS more puzzling. At this point they can't believe that missile attacks on civilian targets will break UKR morale, or that occupying a few more square miles of rubble will accomplish much 8/ — PolitiTweet.org

Paul Krugman @paulkrugman

UKR seems to be doing a fighting retreat to inflict attrition while awaiting Western weapons systems, eventually reaching a point where the balance of power swings to their side. This could fail; we don't know how much UKR itself is being attrited. But it's comprehensible 7/ — PolitiTweet.org

Paul Krugman @paulkrugman

But since then it's been grinding attrition, with WW1 rates of advance at best. So what are the two sides trying to accomplish? I think I get Ukraine's strategy; Russia, not so much 6/ — PolitiTweet.org

Paul Krugman @paulkrugman

So what about this war? The Russians' defeat at Kyiv was decisive in that they seem to have lost so many tanks relative to production rates that they're no longer capable of rapid advances: even when their guns make a gap in Ukraine's lines they can't follow through 5/ — PolitiTweet.org