Monday, 24 April 2017
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    What the Gold Standard Is and Why Government Killed It

    April 19, 2017
    This piece originally appeared in Learn Liberty The gold standard is both a strongly advocated and vehemently opposed monetary regime. Both positions, however, usually rely on misconceptions on what the gold standard actually is and why it failed. Below, I will discuss (1) what the gold standard is, (2) what is not, and (3) why […]

    Here’s Where All That Chinese Money Came From

    April 12, 2017
    This piece originally appeared in Forbes Have you read about tens of billions of U.S. dollars — sometimes over $100 billion — “flowing out of China” every month? Makes one wonder where, how and when China got the plates, paper and special ink to start printing American currency. Of course, it is all electronic money, […]

    Why Inflation Is Not Helping European Stocks

    April 11, 2017
    The Euro zone CPI data continues to show the rising trend we commented here (read). In January inflation rose by 1.8% year-on-year, the highest reading since February 2013. However, while inflation expectations rise, markets remain stale. The stock market is not showing any boost from this reflation trend. Why? Inflation is up mainly due to energy’s positive […]

    Let’s get back to basics. What is a price?

    March 30, 2017
    A price is an exchange ratio: you must give up a certain amount of one good in order to get another good.  Barter economies have prices, which are expressed as ratios of the goods themselves.  In money-using economies, prices are expressed in the economy’s medium of exchange, which frequently makes the medium of exchange the […]

    Against the War on Cash

    March 27, 2017
    In recent years, economists and central bankers have been advocating moving away from cash transactions towards an economy relying fully on financial transactions. At prima facie, this seems to be a good idea. Using checks and financial transfers can be more secure; the fact that every transaction is recorded makes illegal transactions (drug deals, etc.) […]

    Cash and the Zero Lower Bound

    March 22, 2017
    This is the fourth (and, perhaps, final) post on Ken Rogoff’s The Curse of Cash. As summarized in an earlier post, Rogoff argues that the benefits of banning cash (e.g., preventing crime, enabling effective monetary policy) exceed the costs (e.g., a reduction in financial privacy). He does not attempt to estimate the benefits and costs […]

    The End Of Currency Wars?

    March 20, 2017
    This piece originally appeared in Hedgeye “From its creation in 1913, the most important Fed mandate has been to maintain the purchasing power of the dollar; however, since 1913 the dollar has lost over 95 percent of its value” -James Rickards One of the least talked about proposals of the future Trump administration is the one […]

    Nominal is Real; Real is Artificial

    March 13, 2017
    A basic tenet of macroeconomics and monetary economics is the difference between nominal variables and real variables. Nominal variables are expressed in current market prices. Real variables are adjusted to reflect the changing purchasing power of money over time (inflation or deflation). For example, the nominal interest rate is the rate that currently prevails in […]