Krugman says the same thing that I've said here many times: that the USD is never going to go away as a unit of measurement.
Given Krugman’s track record with predictions, he’s not exactly someone you can rely on. Even though he’s a Nobel laureate, he’s got a whole host of failed predictions under his belt. I had a quick Google search and the first thing that came up was the AI result:
Paul Krugman, a Nobel laureate economist and New York Times columnist, has a record of notable failed predictions, often stemming from pessimistic political forecasting or underestimating technological growth. Major errors include predicting that the internet’s economic impact would be no greater than the fax machine's by 2005, forecasting a permanent global recession if Donald Trump was elected in 2016, and admitting error on his early, transitory view of inflation in 2021.
Key Failed Predictions and Incorrect Forecasts:
Internet Impact (1998): Krugman famously predicted in 1998 that "by 2005 or so, it will become clear that the Internet's impact on the economy has been no greater than the fax machine's".
Trump Election Recession (2016): After Trump's 2016 victory, he wrote, "we are very probably looking at a global recession, with no end in sight". Instead, the U.S. economy experienced a pre-pandemic boom.
Inflation Transitory (2021): Krugman admitted he was wrong regarding his initial assessment that the post-COVID inflation spike would be transitory, admitting his error in a New York Times feature.
2008 Dollar Crash: Following the 2008 housing bust, he predicted a significant fall in the value of the dollar, which did not occur.
Bitcoin/Crypto: He has been a long-term critic and skeptic of Bitcoin, often predicting its failure, which has been described as a continuous wrong prediction by critics.
Euro Survival: He wrongly predicted the failure of the Euro currency.
Obama Stimulus Growth: He predicted that the Obama-era economic stimulus would create 4% growth, while the actual result was 1.7%.
Contextual Observations:
Admitting Error: Unlike many pundits, Krugman has occasionally acknowledged his mistakes, such as his incorrect inflation projection, stating in a CNN interview that it is important to admit when he is wrong.
Political Focus: Many of his more notable miss-predictions are linked to his analysis of political outcomes (such as the 2016 election), which some critics argue often override his economic modeling.
Market Analysis: He has often predicted stock market crashes (such as in 2016) that did not align with actual market performance.
