Wrong About Everything! i. Bond Vigilantes Are on the Run

First in the "Wrong About Everything!" series, showing that the GOP and associated Tea Party idiots haven't just become unmoored from reality, but they've lost sight of its shore.

Paul Krugman: Holy Bond Yield, Batman

So the long bond has plummeted to 2.57%. This is extraordinarily low, and it shows that bond traders have absolutely no fear of the impact of deficits. Quite the contrary, it shows they fear pervasive deflation.

To put this in perspective, when the Bush Administration ran the credit card hot to fight a pointless war in Iraq, the rate was typically around 4.5%. And in the late 90s, when the deficit was nonexistent due to higher taxes AND healthy economic growth (yeah, don't get me started), it ran nearly 6%.

At these rates, the government could refinance quite a bit of its existing debt and save enough in interest payments alone to pay for ten of the weak-ass stimulus bills that the GOP is going nuts about.

If 6% was nothing to worry about in the greatest period of economic expansion in recent memory, why are we freaking out about 2.5% now? We should be running the printing press nonstop until rates climb at least that high. And I submit that running it up to 10% to prevent a deflationary nightmare is probably not unreasonable.