Thursday, 21 September 2017

Monthly Archives December 2010

Second Annual Sound Money Essay Contest

Posted by Alex Chafuen
December 30, 2010
in Blog

Is the world economy in crisis because it lacks the fundamentals of sound money?  If you believe that sound money is the key to our recovery, tell us why.    Join Atlas’s 2nd Annual Sound Money Essay Contest and win cash prizes.  This  year’s theme is “Money in Crisis.”  Deadline is January 15th, 2011.

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“Impacts of Proposed Changes in the Fed’s Mandate” – Taylor

Posted by Tom Duncan
December 29, 2010
in Blog

“[T]here are several reasons to believe that QE2 would not have happened had Fed officials not been able to refer to a dual mandate in the Federal Reserve Act as justification for the intervention. First consider this bit of emprical evidence: There have never been so many references to the dual mandate by Fed officials […]

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“Medical Inflation Higher Than Other Economic Sectors”

Posted by Tom Duncan
December 29, 2010
in Blog

“The cost of medical services and commodities continues to grow, and this may be a factor contributing to a recent decline in a measurement of patient confidence in their ability to pay for health care. Overall inflation for the past year was 1.1%, with the “core” rate at 0.8% taking out the more volatile food […]

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“Lehman ‘Prophet’ Fears Second Crisis If US Interest Rates Are Kept Low”

Posted by Tom Duncan
December 29, 2010
in Blog

“The criticism of the Federal Reserve comes as it embarks on another $600bn (£380bn) of quantitative easing – or printing money – in an effort to fire up a stronger recovery next year. Interest rates around the western world, including in Britain, have sat at or below 1pc since the near collapse of the financial […]

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“Inflation and Interest Rate Trends Look Positively for Gold in 2011”

Posted by Tom Duncan
December 28, 2010
in Blog

“Gold prices generally rise during times of actual or projected inflation because of gold’s traditional status as a “safe haven” asset. Gold buyers seeking an asset which reacts favorable to inflation or currency devaluation often move from the falling currency into gold. Currently, the Federal Reserve is more concerned with deflation than inflation and, as […]

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“Central Bank Targets Inflation” – China

Posted by Tom Duncan
December 28, 2010
in Blog

“The over-fast growth of the domestic real estate market has been the result of the country’s unusual monetary policy since the start of the global financial crisis. The latest rate hike indicates the central bank’s resolve to restore the emergency monetary policy to normal and bring the red-hot real estate market back onto the track […]

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“The Fed’s Dual Mandate Is Not The Problem” – WSJ

Posted by Tom Duncan
December 28, 2010
in Blog

“While some clarification of its price-stability mandate might help, the central bank is already required to keep credit growth in check. Its full legal mandate is as follows: “The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of monetary and credit aggregates commensurate with […]

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“Current course leads to inflation”

Posted by Tom Duncan
December 27, 2010
in Blog

“The Federal Reserve, and the Congress, are both playing a high-stakes game of risk. Essentially, the one is betting that it can spend its way out of our recession and unemployment problems and the other is betting that it can add huge amounts of liquidity — money — to the system and cut it off […]

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“For Tough Fed Call, Even Hindsight Is Not 20/20” – WSJ

Posted by Tom Duncan
December 27, 2010
in Blog

“The world has changed since the Federal Reserve decided in November to purchase an additional $600 billion of U.S. Treasury bonds to give the U.S. economy a lift. The U.S. economy looks stronger. The government is unexpectedly cutting taxes. The Fed is facing stiff political criticism at home and abroad. In part as a result […]

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“Fed’s Free Money Lures This Important Writer: Kevin Hassett”

Posted by Tom Duncan
December 27, 2010
in Blog

“If I were to default on my debts, the world would see that even trained economists who spend little on their appearance can’t make ends meet. Imagine the global panic, the massive selloff, that would follow. Clearly, then, I meet the definition of systemically important. Not convinced? The Dodd-Frank financial law, in creating the Financial […]

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“New Voters May Sway Fed Actions” – NYT

Posted by Tom Duncan
December 27, 2010
in Blog

“Most economists think the Fed is unlikely to drastically alter its policy direction, though some of the new members could nudge policy toward more restraint and less activism. Two of the four new voters are viewed as hawkish on inflation, meaning that they tend to be more worried about unleashing future inflation than they are […]

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“Fed’s Mysterious Policy: How will we know if it’s working?”

Posted by Tom Duncan
December 23, 2010
in Blog

“Few economists expect the jobless rate to fall below 9 percent in 2011; the Fed itself projects a range between 8.9 percent and 9.1 percent. That’s why Alice Rivlin, a former Fed vice chairman, expects little from QE2. “I think it was conceived as insurance for the recovery,” she said. “I never thought this was […]

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“Is the Fed Printing Money?” – WSJ

Posted by Tom Duncan
December 23, 2010
in Blog

“The Fed has been buying bonds since early 2009. When a private investor buys bonds, the investor uses cash or sells some existing asset to raise cash and uses that money to buy bonds. The investor might also borrow money from a bank and use the borrowed funds to buy securities on margin. The Fed […]

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“Plosser Says Fed May Need to Slow Purchase of Bonds”

Posted by Tom Duncan
December 23, 2010
in Blog

“The Federal Reserve may need to slow or stop its purchases of U.S. Treasuries in response to an accelerating U.S. economy next year, Philadelphia Fed President Charles Plosser said. “If the growth rate of the economy continues to strengthen and looks sustainable, then I am going to be looking for the Fed to react to […]

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Fed Swap Lines Purposefully Keeping Dollar Weak

Posted by Tom Duncan
December 23, 2010
in Blog

“In layman’s terms, we can think of a swap line as a standing guarantee of U.S. dollar liquidity. If you (as a central banker) ever need greenbacks in a pinch, you know you’ll be able to procure them instantly, no matter how “tight” the open market may be. This standing guarantee reduces the odds of […]

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Last Year’s Sound Money Essay Contest Winner Published

Posted by Tom Duncan
December 22, 2010
in Blog

We are pleased to note that last year’s Sound Money Essay Contest winner, Nicolas Cachanosky, was able to get his winning essay published in New Perspectives on Political Economy! Congratulations to Nicolas. The article can be found in NPPE, Volume 6, Number 1, which can be found here. Nicolas’s article is entitled “The Endogenous Stability […]

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“Fed’s Bullard: Full of Self-Contradictions”

Posted by Tom Duncan
December 22, 2010
in Blog

“The bottom line is this: Unlike China where its central government can mandate banks to actually lend to business and individuals, Fed’s two rounds of QE liquidity did not go to where it’s intended; it is instead trapped on banks, and corporations’ balance sheets. U.S. banks have been holding about $1 trillion of excess reserves […]

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“Fed Has Aided Stocks, Not Rates or Jobs” – CNBC

Posted by Tom Duncan
December 22, 2010
in Blog

“The Federal Reserve’s policy to purchase $600 billion of bonds in a program widely known as QE2 has been mostly ineffective at lowering interest rates and will do little to improve the unemployment rate, according to the exclusive CNBC Fed Survey in December. The survey of 76 economists, bond and stock traders, and analysts, found […]

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“China’s Coming Inflation Nightmare”

Posted by Tom Duncan
December 21, 2010
in Blog

“It is our suspicion that China likes declining commodities. Soaring prices over the past several months have made it much more expensive for China to squelch its never-ending thirst for raw materials. What better way to get lower prices and fighting inflation pressures at home, than to promote the idea that interest rates will rise, […]

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“Inflation, Here is Thy Sting”

Posted by Tom Duncan
December 20, 2010
in Blog

“The sting of inflation is showing up in the emerging market economies, where rising food prices are stinging the consumer. (Oh sorry I forgot, food inflation isn’t inflation!) China has a de facto USD peg and that policy means that, in the absence of other action, US monetary policy is Chinese monetary policy. The tsunami […]

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Fed Bans Bank’s Symbols

Posted by Tom Duncan
December 20, 2010
in Blog

“This is just another example of how the Federal Reserve has gotten completely and totally out of control. The Fed has become an unaccountable monster that is just running around doing just about anything that it wants to do. It is for some very good reasons that many members of Congress are starting to publicly […]

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“Canada Urges ‘Moderate’ Monetary Policy”

Posted by Tom Duncan
December 17, 2010
in Blog

“On Monday, Bank of Canada Governor Mark Carney warned that Canadians are “stretched” financially and “increasingly vulnerable to an adverse shock” such as interest rate hikes. Carney urged Canadians to be “prudent in their borrowing,” and ensure that in the future they can service debts taken on today. He also called on banks to be […]

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“Money Rules” – Scott Sumner

Posted by Tom Duncan
December 17, 2010
in Blog

“There is no laissez faire in fiat money. If the Fed holds the money supply constant, it will be changing the interest rate and the price level. And if it holds interest rates constant, it loses control over the price level and money supply. As a result, many economists now favor some sort of inflation-targeting […]

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“Ron Paul Appears Poised to Irk the Fed Chief” – NYT

Posted by Tom Duncan
December 17, 2010
in Blog

“Mr. Paul takes on the subcommittee post at a time when the Fed is far better known than it was in the 1960s, and after its reputation has alternately soared and plunged. It was given credit for the long booms of the 1990s and earlier this decade, and for steering the economy out of the […]

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“Why Is Ryan Flirting With Gold Bugs?” – FrumForum

Posted by Tom Duncan
December 17, 2010
in Blog

“In his speech to the panel, Rep. Ryan declared that Shelton’s pamphlet was “The best 25 pages on money I’ve read in a long, long time.” He chastised the Fed for their claims that they were not trying to monetize the debt, “Well what are they doing right now?” he asked. “What is happening here […]

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“Hyperinflation, Money Demand, and the Crack Up Boom” – Mises Institute

Posted by Tom Duncan
December 16, 2010
in Blog

“The 20th century saw many hyperinflations, including China in 1949–50, Brazil in 1989–90, Argentina in the late 1980s and early 1990s, Russia in 1992, Yugoslavia in 1994, and, most recently, Zimbabwe in 2006–09. All of these hyperinflations were the direct result of a system of unfettered fiat money under government control — a system that […]

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Stylized Facts, Public Policy and the “Crack Up Boom” – Peter Boettke

Posted by Tom Duncan
December 16, 2010
in Blog

“In reading Mises I am always struck by how fresh he still reads, and how relevant his analysis of contemporary policy in the first half of the 20th century still is relevant for us at the beginning of the 21st century. Of course, there is the enduring insights that transcend time and place — Mises […]

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“Audit the Fed in 2011” – Ron Paul

Posted by Tom Duncan
December 16, 2010
in Blog

“Since the announcement last week that I will chair the congressional subcommittee that oversees the Federal Reserve, the media response has been overwhelming. The groundswell of opposition to Fed actions among ordinary citizens is reflected not only in the rhetoric coming out of Capitol Hill, but also in the tremendous interest shown by the financial […]

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“Five Ways Inflation in China Can Affect the US”

Posted by Tom Duncan
December 15, 2010
in Blog

“There’s no free lunch. All potential “solutions” to the Chinese inflation problem come with serious associated potential costs and risks. For example, raising interest rates could devastate the real estate industry and other sectors that have become addicted to cheap credit in China. Quantitative credit restrictions in a country that has relied on subsidized credit […]

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“The New Big Picture”

Posted by Tom Duncan
December 15, 2010
in Blog

“On the other hand, all that has happened is that the tax rates that have now been in force for almost 10 years have been continued for 2 more years. The Fed has the economy fully primed for rising inflation and interest rates as the recovery takes hold. The EPA is on a rampage to […]

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“Fed president would be OK with changes to dual mandate”

Posted by Tom Duncan
December 15, 2010
in Blog

“James Bullard, president of the Federal Reserve Bank of St. Louis, said “it would be OK with me” if Congress used legislation to remove the Fed’s current mandate that it maximize employment in addition to controlling inflation. Bullard made his comments in an interview with Fox Business. “The only thing the Fed can do in […]

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“The Fed’s Bipolar Mandate”

Posted by Tom Duncan
December 15, 2010
in Blog

“The contradictions were as apparent then as now; as Mr. Corker puts it, a central bank cannot have “a bipolar mandate.” The pressure to bring down unemployment using money creation during difficult economic times will inevitably complicate the task of maintaining stable prices. As the Fed pushes money out the door, whether or not there […]

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“The Fed’s QE Scheme Begins to Backfire”

Posted by Tom Duncan
December 15, 2010
in Blog

“The Fed argues that QE is not inflationary, because the electronic money is sitting in the coffers of the banking Oligarchs, and isn’t circulating in the general economy. “One myth that’s out there, – is that what we’re doing is printing money. We’re not printing money. The amount of currency in circulation is not changing. […]

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“Watch What the FOMC Doesn’t Say”

Posted by Tom Duncan
December 15, 2010
in Blog

“The aim of QE2 has been to lower medium-to-longer-term interest rates since the Fed’s main policy variable—the overnight federal funds rate—has been pinned near zero for two years. But since the Nov. 3 FOMC meeting, Treasury yields have done precisely the opposite of what the Fed intended. The two- and five-year note yields have nearly […]

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“Sense and nonsense in the quantitative easing debates”

Posted by Tom Duncan
December 14, 2010
in Blog

“Unemployment is not high because the maturity structure of government debt is too long, thank you, nor from any lack of “liquidity” in a banking system that is sitting on a trillion dollars of cash. It’s time to focus on the real, microeconomic, tax, and regulatory barriers to growth, not a policy that creates a […]

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“Fed expected to dampen rate rise expectations”

Posted by Tom Duncan
December 14, 2010
in Blog

“The central bank is not expected to signal any shift away from its intention to buy $600 billion in government debt but markets are already bringing forward expectations of when the Fed may start to raise interest rates. Eurodollar futures fell to three-month lows this week and two-year Treasury yields are at their highest level […]

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“Producer Prices Rise Most in 8 Months”

Posted by Tom Duncan
December 14, 2010
in Blog

“Since August, there certainly doesn’t seem to be much deflationary threat here. The 12-month change in PPI for finished goods is 3.5% as of November. So what’s driving the increase in prices? Food and energy make up a significant influence. Food prices rose by 1.0%, and energy prices were up 2.1%. You have probably noticed […]

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“Beware of a China Bubble”

Posted by Tom Duncan
December 10, 2010
in Blog

“After QE2, analysts were looking for possible consequences of the Federal Reserve Bank’s actions. What has become apparent is that the Fed has created another bubble in China. Investors globally have transferred devalued US dollars and euros to buy Chinese property and equities. China has had to combat imported inflation with rapidly rising asset prices. […]

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“Dollar Weakens Versus Euro as Treasury Yields Decline Before Fed Meeting”

Posted by Tom Duncan
December 10, 2010
in Blog

“The dollar fell against the euro, paring a weekly gain, on speculation Federal Reserve policy makers on Dec. 14 will discuss a plan to extend Treasury purchases to support growth. The dollar dropped as benchmark Treasury yields declined for a second day, damping the allure of U.S. assets. Fed officials announced last month a $600 […]

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Back to Basics with the Sound Money Forum

Posted by Tom Duncan
December 10, 2010
in Blog

As many of you may know, Sound Money received a real boost on Tuesday, December 7. Atlas, in partnership with Freedomworks, hosted a monetary policy forum. For full details and to watch the forum, refer to this earlier post. Since then, interest has been growing. We at Atlas, and I’m sure Freedomworks would agree, are […]

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“More Than Half of Americans Want Fed Reined In Or Abolished”

Posted by Tom Duncan
December 9, 2010
in Blog

“Americans across the political spectrum say the Fed shouldn’t retain its current structure of independence. Asked if the central bank should be more accountable to Congress, left independent or abolished entirely, 39 percent said it should be held more accountable and 16 percent that it should be abolished. Only 37 percent favor the status quo. […]

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Selgin on the Fed

Posted by Tom Duncan
December 9, 2010
in Blog

“George Selgin, of the University of Georgia, talks with EconTalk host Russ Roberts about whether the creation of the Federal Reserve in 1913 has been a boon or a bust for the U.S. economy. Drawing on a recent paper with William Lastrapes and Lawrence White recently released by the Cato Institute, “Has the Fed Been […]

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Ben Bernanke’s Bond Bunk

Posted by Tom Duncan
December 8, 2010
in Blog

“Here’s the problem in the main: Bernanke’s only tool to “tighten” monetary policy means selling bonds into the market and taking in cash from the system. But what happens if he holds bonds that have all gone down in value? He gets screwed, that’s what. In an extreme case, the Fed could go “bankrupt.” Bernanke […]

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Money Printing and 100% Confidence, Day 4

Posted by Tom Duncan
December 8, 2010
in Blog

“[Bernanke is] a different man, somehow, and likely not for the better as growing dissent amongst even his own Federal Reserve board has no doubt made him less confident in his actions today than he was 18 months ago when there was near unanimity from his peers about the decisions that were being made. The […]

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“David Einhorn Explains How QE2 Will Affect The Average American…”

Posted by Tom Duncan
December 8, 2010
in Blog

“Basically, the Fed just threw away $600 + billion because QE2 “will be counterproductive,” [David Einhorn] told Rose, according to Bloomberg. “The goal of quantitative easing right now is to raise the inflation rate. If you do raise the price of clothing, it effectively lowers everybody’s standard of living and gives them less money to […]

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“Jon Stewart Busts Fed Chair Ben Bernanke on ‘Printing Money'”

Posted by Tom Duncan
December 8, 2010
in Blog

“Federal Reserve Chairman Ben Bernanke is so busted. Comedy Central host Jon Stewart added his voice to others who caught the central banker contradicting himself over whether or not the Fed is “printing money” through its actions to bolster the economy. BERNANKE: Well, this fear of inflation, I think is way overstated. We’ve looked at […]

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No Doubt Ben Bernanke Is Sincere, But What If He Is Sincerely Wrong?

Posted by Tom Duncan
December 7, 2010
in Blog

“As you no doubt know, Ben Bernanke gave an interview tonight on CBS 60 Minutes. Let me stress once again, as I have in the past, that I consider Ben Bernanke one of the most genuinely nice guys among elite economist I have had the good fortunate to meet. He has no reason to remember […]

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“Credit-Card Borrowing Dips, but Student Loans Jump”

Posted by Tom Duncan
December 7, 2010
in Blog

“Consumer credit outstanding increased at a seasonally adjusted annual rate of 1.7%, up by $3.4 billion to $2.4 trillion, a Federal Reserve report said Tuesday. The gain was the second in as many months following 19 straight losses. Economists surveyed by Dow Jones Newswires had predicted a $2 billion decline in October consumer credit. The […]

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A Guide to Sound Money

_SMP_guide_smallThe Atlas Economic Research Foundation is proud to introduce A Guide to Sound Money.

Click here to download a PDF of the guide

This pocket guide, co-published byAtlasFreedomWorks, offers a concise, powerful introduction to Sound Money principles. Its easy-to-read and compact style makes it a great primer for distribution at conferences and public meetings, where you can help Atlas kindle grassroots interest and activism in the direction of stronger money. The Guide is intended for both educational use by the broader public and as a resource for policy makers when considering monetary issues.

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Sound Money at the Capitol – Dec. 7

Posted by Tom Duncan
December 7, 2010
in Blog

Given that our country is still reeling from the recessionary effects of bad monetary policies, the times call for serious conversations about sound money. It is critical that the principles of sound money inform our policy directions if America is to regain its leadership role in the global economy. Our financial crisis and the weakened […]

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