“The masses are misled by the assertions of the pseudo-experts,” wrote Mises, “that cheap money can make them prosperous at no expense whatever.” The damage that this inflationary fallacy has done to our monetary institutions cannot be over-estimated. In spite of efforts by classical and Austrian economists to refute it, it refuses to die. It has
This much is clear: the massive buildup of debt through the system of fiat money and fractional reserve banking with a central banking as the money printer of last resort cannot conceivably be paid off. It will have to be defaulted in one way or another: either through an outright (nominal) default, or by inflating the dollar down to zero value.
Government figures put US savings at 0.3% of income. Two recent articles ( Are Spendthrift Americans Really the Problem? in the New York Times , and A Savings Crisis? Maybe Not in Business Week , state that the alleged low savings rate in the US is either mis-measured or not a problem anyway. The charge of mis-measurement may carry some weight.
An obscure regulatory agency, the OFHEO, has succeeded in bringing down one of the politically savviest and most well-connected figures in the Washington, Fannie Mae CEO Franklin Raines. An OFEHO investigation revealed that Fannie Mae had been violating rules concerning derivatives accounting, and that the resulting mis-statements in their
This from Casey Research (not much to add here): According to a report in the Taipei Times, none other than the Democratic Peoples Republic of Korea has declared war on long hair. Despite the fact that the supreme authority, “dear leader” Kim Jong-Il, sports a bit of a bouffant, other male North Koreans have been advised that it is
This whopper from Peter Schiff. It’s hard to say it any better than Peter, so I’ll let him take over: [shown] today on CNBC, as Steve Leisman and a guest described American consumption as being “a sacrifice,” and American consumers as “bearing the brunt of world consumption,” and of having an “obligation to consume.” First of all, the word
A speech by Fed Governor William Poole GSE Risks , outlines the risks that the GSEs could trigger a financial crisis. While this might be part of the Bush administration’s efforts to reign in Fannie Mae (covered in an excellent Fortune Magazine article this week), it is still surprising that a central banker would be so outspoken on this point —
Jim Puplava’s Financial Sense News Hour features an interview with author David Tripp, whose book Illegal Tender tells the tale of a US gold coin that was lost, found, banned, recoverd, stolen, and finally resurfaced and sold at auction for $7M. The origin of the story lies in FDR’s 1933 bill making the “hoarding” of gold illegal. Although
Macleans of Canada asks Is America Going Broke? . What is notable about this story is not so much the topic. Austrian Economists have been forecasting the failure of the dollar-based fiat money system since the Bretton Woods system was instituted - see for example Hazlitt’s out of print From Bretton Woods to World Inflation , and Hans Hoppe’s
Famed asset manager Jeremy Grantham’s essay Replacement Cost: The Bedrock of Value (follow link and then advance to page 7 of 9 in the PDF). Grantham writes as follows: The total market must sell at about the total cost of replacement. It may be hard to calculate, but if we could know the true replacement value it would be the fair value of the
What is the Mises Institute?
The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard.
Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.