Another Dissenting Voice on Inflation

Brad DeLong has added his voice to those who think inflation worries are misplaced if not outright dishonest

When markets are scared that governmental finances are broken, the prices of long-term government bonds are low and the interest rates on long-term government bonds are high. While U.S. long-term Treasury bonds have fallen recently, their prices are not low by any standard. Markets are not yet nervous about broken American government finances and the risk of future inflation. Maybe they should be nervous. But they are not yet.

Thus any argument that begins: "financial markets are nervous about the U.S. long-run budget deficit..." needs to be thrown out the window.