Paul Krugman Crushes Rick Santelli

A few weeks ago, we found a video undermining Rick Santelli’s claim that his complaints about Fed easing “were never about inflation.”¬†

If you needed more proof, a reader has sent us the following clip from 2009 in which Santelli warned inflation would be “stunning” (start at 4:20):

So if his argument was never  inflation, what did it concern?

In the aforementioned segment (an exchange with WSJ’s Jon Hilsenrath), Santelli said his main concern had always been “gyrations … in foreign exchange programs.”

Today, Paul Krugman completely dismisses that fear, in a post titled: “Fish in a Barrel, Rick Santelli Edition.”

He looks the dollar’s movement against major currencies, as expressed in the following chart:

071313krugman3 blog480

It’s true that the dollar fell sharply at the beginning of 2009, but this was as a result of the crisis fading, and the safe-haven bid coming out of the dollar (a good thing).

As for the real meat of the argument, here’s Krugman:

See how stable the dollar was before the Fed starting QE? See how much it has plunged since? Neither do I.

Not exactly gyrations.

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