I'll put one Bloomberg journalist up against as many Nobel Econ award winners as you want.
Especially if the Nobelists include the LTCM boys, Merton and Scholes, and Krugman.
On February 6 Professor Krugman displayed his political hackery by writing an opinion piece for the New York Times, "Droughts, Floods and Food" in which he weasel-worded that global warming had caused the popular uprising in Egypt. Here's a schematic of his argument:
global warming>causing bad weather>causing crop failure>causing increased food prices>causing riots.Leaving the science and the politics aside there is one reason to be wary of Krugman:
Listening to ideologues will cost you big money.If his argument was in any way correct the situation could not, would not [please don't do the Dr. Seuss thing -ed] reverse such that major commodities drop 20% in 48 hours (and if you annualize that...)
On Dec. 31 we totted up how many pages of global warming stuff I've read since the Shindig in Rio back in '92. It's up to something like 120,000 pages. You try wading through the Stern Review without laughing at his discount rate assumptions. Go ahead, try to keep a straight face, I'll wait.
I knew you wouldn't.
I did, that's why I'm such a blast at cocktail parties.
I'll come back to Krugman on a few different topics over the next month. Here's Bloomberg:
Wheat plunged for a third day in its biggest collapse since 2008 and corn and rice dropped as traders speculated that riots in North Africa and the Middle East will curb demand from regions buying 32 percent of global shipments.
All three grains and soybeans fell by the most allowed by the Chicago Board of Trade yesterday, and all four commodities, extended the decline today, as violence escalated in Libya. Leaders were already toppled this year in Tunisia and in Egypt, the world’s biggest wheat importer.
Grain prices initially surged as North African and Middle East nations accelerated purchases, seeking to bolster reserves and curb unrest partly linked to food prices the United Nations says rose to a record last month. The U.S., the biggest exporter, is forecasting a 49 percent jump in its shipments in the 12 months ending in June, the most in 18 years.
“The market assumes the Middle East will stop importing until the whole situation calms down,” said Jonathan Bouchet, an analyst at OTCex Group, a commodities brokerage in Geneva. “The market could easily continue its way down overall because of what’s happening. The situation in the Middle East region has the market wondering if they’re going to slow food imports.”
Wheat for May delivery fell 15.75 cents, or 2 percent, to $7.80 a bushel on CBOT, after earlier slumping as much as 4.9 percent. The grain dropped almost 12 percent in three trading sessions, the most since March 2008....MORE