Krugman mostly weaseling out

Krugman is argues that rate matter (they do). Did Krugman actually say the Fed sets rates here?

Krugman: Via FT Alphaville, James Montier has an interesting piece castigating economists for their “interest rate idolatry”, their belief that central bank-set interest rates matter a lot for the economy and that therefore it is useful, at least conceptually, to think about the “natural” rate of interest that would lead the economy to full employment. There is no evidence that interest rates matter in that way, he says, and economists who talk about natural rates are simply engaged in groupthink.

In particular, he identifies three blind and/or stupid economists leading everyone astray: Janet Yellen, Larry Summers, and yours truly.

Well, it could be true; there’s plenty of stupidity in the world, and much of it imagines itself wise. But in my experience people who declare confidently that “economists don’t understand X” usually turn out to be wrong both about X and about what economists understand. As I wrote in one context, often what they imagine to be a big conceptual or empirical failure is just a failure of their own reading comprehension.

Not clear is it?  It is not clear because Krugman knows there has been an ongoing search by me to see exactly when and where the the Fed actually sets rates.  In almost all cases, excetp Volker and the Nixon shock, the Fed simply follows the market.  This is a well documented fact and Krugman knows it.

So, you see, he takes the argument and skillfully changes it to rates matter, and doe not address the issue proposed, that the Fed is a fraud which claims to set rates.

Here is my bet, Krugman will never say that any Fed actually set rates beyond Volker.  He will slightly alter the subject, then skip town.