Monday, 11 December 2017

Monthly Archives June 2012

The Cultural and Spiritual Legacy of Fiat Money

Posted by Gonzalo Schwarz
June 29, 2012
in Blog

by Jörg Guido Hülsmann The notion that inflation is harmful is a staple of economic science. But most textbooks underrate the extent of the harm, because they define inflation much too narrowly as a lasting decrease of the purchasing power of money (PPM), and also because they pay scant attention to the concrete forms of inflation. […]

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Dinner is Served

Posted by Gonzalo Schwarz
June 29, 2012
in Blog

What Happens When the Government Grows Tired of Waiting for the Eggs to be Laid? The Goose With the Golden Eggs Written by Ralph J. Benko “…and thinking to get at once all the gold the Goose could give, he killed it and opened it only to find nothing.”Many wise aphorisms got their start, in […]

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Teach Your Children to Understand Sound Money

Posted by Gonzalo Schwarz
June 28, 2012
in Blog

There is a good reason why so many accept the legal tender fiat money regime here in America when only 80 years ago it took the threat of imprisonment to get many to give up their sound money: you will never be taught about sound money, real money, in government schools. And it is a difficult […]

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Fiat Money Kills Productivity

Posted by Gonzalo Schwarz
June 27, 2012
in Blog

From Azizonomics: I have long suspected that a money supply based on nothing other than faith in government is a productivity killer. Last November I wrote: During 1947-73 (for all but two of those years America had a gold standard where the unit of exchange was tied to gold at a fixed rate) average family income […]

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Is Greater Productivity a Danger?

Posted by Gonzalo Schwarz
June 27, 2012
in Blog

To go along with the previous post which points out that Total Factor Productivity growth has decreased in the era of pure fiat money, here is a reminder: Low productivity is bad. I know, that seems obvious to anyone who reads this site, but unfortunately a reminder seems necessary for some… From Mises.org: by David […]

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It Ain’t So, Joe

Posted by Gonzalo Schwarz
June 26, 2012
in Blog

by Kurt Schuler Commenting on the appearance of the 100th issue of the Journal of Economic Perspectives, its founding editor, Joseph Stiglitz,remarks (page 22) that a diversity of perspectives is “especially important in a field known for having certain orthodoxies—orthodoxies that dominate for a while and then fade, making the profession sometimes look less like a science than it would […]

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Ron Paul Hearing on Fractional Reserve Banking

Posted by Gonzalo Schwarz
June 26, 2012
in Blog

  House Subcommittee to Examine Fractional Reserve Banking and High-Powered Money WASHINGTON, June 25 Congressman Ron Paul, Chairman of the Domestic Monetary Policy and Technology Subcommittee, announced today that the subcommittee will hold a hearing this week to examine fractional reserve banking. “Fractional reserve banking underpins the entire banking system, yet its effects on society […]

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A Free-Market Monetary System

Posted by Gonzalo Schwarz
June 25, 2012
in Blog

by Friedrich A. Hayek [A lecture delivered at the Gold and Monetary Conference, New Orleans, November 10, 1977. It made its first appearance in print in the Journal of Libertarian Studies, Volume 3, Number 1.] When a little over two years ago, at the second Lausanne Conference of this group, I threw out, almost as a sort […]

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The Fiasco of Fiat Money

Posted by Gonzalo Schwarz
June 25, 2012
in Blog

by Thorsten Polleit I. Today’s worldwide paper-, or “fiat-,” money regime is an economically and socially destructive scheme — with far-reaching and seriously harmful economic and societal consequences, effects that extend beyond what most people would imagine. Fiat money is inflationary; it benefits a few at the expense of many others; it causes boom-and-bust cycles; it […]

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The Solution to Concentrated Power: the Three Ds

Posted by Gonzalo Schwarz
June 22, 2012
in Blog

From oftwominds.com Why keep squabbling over issues that cannot be resolved except by the Tyranny of the Manipulated Majority? Decentralize, diffuse and devolve power to the lowest level and the national dead-ends vanish. Natural selection will sort out what works and what doesn’t. The solution to centralized power can be summarized as the three Ds: […]

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Power to China in the I.M.F. – Does this mean Gold to be Mobilized?

Posted by Gonzalo Schwarz
June 22, 2012
in Blog

by Julian D. W. Phillips  Contributions to the I.M.F. Come with Conditions  While the B.R.I.C.S nations are contributing to the I.M.F.’s funding with the purpose of shoring up the global financial system, they’ve stipulated that they want more power in the I.M.F. China is contributing $43 billion, so as it races to become the world’s leading economic and financial nation it wants a bigger part of the decision making process, commensurate with its rising power. So the first question to be asked is, “Will it get it?” The emerging countries –China, Brazil, Mexico, India and Russia— announced contributions to the IMF’s global firewall, nearly doubling the fund’s resources to $456 billion, at the G-20 summit in Mexico this last weekend as global efforts to restore confidence in the […]

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It’s the Money Supply, Stupid!

Posted by Gonzalo Schwarz
June 21, 2012
in Blog

by Steve H. Hanke This article appeared in the July 2012 issue of Globe Asia. During the 1992 presidential campaign, former President Clinton’s rallying cry was “It’s the Economy, Stupid.” He sang it to perfection and won the election. Today, the smart politicians (and economists) should realize that “It’s the Money Supply, Stupid.” One doesn’t have […]

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Tinker Bell Economics in Europe

Posted by Gonzalo Schwarz
June 20, 2012
in Blog

by Gary North If you have seen the stage version of Peter Pan, you know the scene in which the audience is asked to clap if they want Tinker Bell to live. It’s time. Janet Daley wrote a provocative essay in London’s The Telegraph on the day before the Greek election (June 16). She did her best to explain why […]

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“The whole thing’s a giant Ponzi scheme!”

Posted by Gonzalo Schwarz
June 20, 2012
in Blog

More from the hilarious and blunt Nigel Farage, leader of the UK Independence Party. He proposes to toast being described as a Libertarian and calls out European leaders for being enamored of Chairman Mao and for leading Europe back to the days of the Soviet Union. As always, enjoy the fireworks! image: flickr.com/EuroRealistNewsletter

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Trivial Objections to Fractional Reserve Banking

Posted by Gonzalo Schwarz
June 19, 2012
in Blog

The Murray N. Rothbard Memorial Lecture. Recorded 9 March 2012 at the Ludwig von Mises Institute in Auburn, Alabama. Includes an introduction by Joseph T. Salerno.   Learn more at mises.org… image: flickr.com/naturewise

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A Call to Arms for Central Banks

Posted by Gonzalo Schwarz
June 19, 2012
in Blog

by Alasdair Macleod  The rate at which the majority of the eurozone is descending into insolvency is accelerating. The rescue package for Spanish banks, which appears to have been provisionally set at a figure designed to impress the markets, hardly even produce a dead-cat bounce. All it has achieved is to draw attention yet again to the helplessness of the authorities in dealing with multiple debt-traps. So what is the answer? It depends on the purpose behind the question. If it is to seek a genuine solution, then the answer is to cut public spending rigorously in all countries that depend on markets to fund budget deficits or to roll over existing debts. Only a convincing budget surplus is going to lead to falling borrowing costs. The objection to this solution is partly political and partly on the grounds of neoclassical economic prejudice. The former persists in placing social objectives above economic objectives, while the latter has been convincingly proved to be wrong. Otherwise, please talk us through how a government actually knows best to kick-start an economy into recovery, without ignoring the accumulation […]

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The Welfare Kings of Europe

Posted by Gonzalo Schwarz
June 18, 2012
in Blog

From Azizonomics.com: In spite of the fact that 85% of Greeks want to stay in the Eurozone, I was reasonably confident that Greeks would support Syriza to a first-place finish, and elect a new government willing to play chicken with the Germans. However Greeks — predominantly the elderly — rejected change (and possible imminent Drachmatization) in favour […]

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Why Apple is Afraid of Bitcoin

Posted by Gonzalo Schwarz
June 18, 2012
in Blog

by Jon Matonis When you finally grasp the magnitude of Apple’s play in the payments business, itbecomes clear that potential competitors will be shunned from the platform. As Daniel Terdiman suggests in CNET, “New Apple features may leave fresh approadkill in their wake as Apple is likely to undercut several existing third-party applications.” With the introduction of Passbook, Apple has launched mobilepayments on iOS and competing virtual payment systems, including bitcoin, mustbe terminated. Roadkill in payment apps has already occurred and they were never given the chance to be made irrelevant. The decentralized digital currency bitcoin has hadtwo functioning payment applications on the Apple App Store — Blockchain Walletand BitPak, both of which have since been unceremoniously evicted. Several otherbitcoin-related apps currently appear in the store but they don’t seem to berestricted by Apple since they don’t enable send/receive transaction capability as the wallets do…  Continue reading at 24hgold.com…

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“America is not Greece”

Posted by Gonzalo Schwarz
June 14, 2012
in Blog

From Zerohedge.com: For your definitive documented “X is not Y” atlasing needs. 1. “Spain is not Greece.” Elena Salgado, Spanish Finance minister, Feb. 2010 2. “Portugal is not Greece.” The Economist, 22nd April 2010. 3. “Ireland is not in ‘Greek Territory.’” Irish Finance Minister Brian Lenihan. 4. “Greece is not Ireland.” George Papaconstantinou, Greek Finance […]

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Which is it? Both–or neither

Posted by Gonzalo Schwarz
June 14, 2012
in Blog

From FreeBanking.org: Scott Sumner writes, “I don’t object to people noting that Bretton Woods had some characteristics of the gold standard; I’ve made that argument myself. But I wish the gold bugs would get the story straight.  Half of them seem to think the US monetary system of the 1920s wasn’t really a gold standard, and half seem to think […]

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The Euro Titanic Has Hit the Iceberg

Posted by Gonzalo Schwarz
June 13, 2012
in Blog

Mutually Assured Financial Destruction “Under the deal, the Italians have to lend to the Spanish banks at 3%, but to get that money they have to borrow on the markets at 7%! It’s genius!” It’s Nigel Farage, back again. Enjoy! image: flickr.com/ericconstantineau

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Inflationeering…

Posted by Gonzalo Schwarz
June 13, 2012
in Blog

To add some context to Devin Roundtree’s recent post, from Azizonomics: As BusinessWeek asked way back in 2005 before the bubble burst: Wondering why inflation figures are so tame when real estate prices are soaring? There is a simple explanation: the Consumer Price Index factors in rising rents, not rising home prices. Are we really getting a […]

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A Cure for What Ails Us

Posted by Gonzalo Schwarz
June 12, 2012
in Blog

It is not enough to encourage enterprise and limit regulation—we need a fixed system of value. By James Grant Bailouts, bear markets and joblessness will surely put capitalism on the November ballot. How do you like your enterprise, Mr. and Ms. American Voter—free or stifled or a little something in between? The 2012 election promises […]

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Duped by Congressional Lies

Posted by Gonzalo Schwarz
June 12, 2012
in Blog

by Walter E. Williams Some of the responses to my column last week, titled “Immoral Beyond Redemption,” prove that Americans have been hoodwinked by Congress. Some readers protested my counting Social Security among government handout programs that can be described as Congress’ taking what belongs to one American and giving to another, to whom it […]

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New CPI Means Higher Taxes, Lower Benefits

June 11, 2012
in Blog

A rose by any other name would smell as sweet, but a steak tastes not as sweet – if it’s a cut of horse  meat… The new CPI calculations are designed to further disguise inflation and the erosion of your standard of living. Last month, the Bureau of Labor Statistics announced that they have enough Congressional approval […]

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Lies, Damn Lies, and Government Statistics

Posted by Gonzalo Schwarz
June 11, 2012
in Blog

Just counting something as a part of “GDP” doesn’t actually make it a “product.” by Peter Schiff Last week in an interview on CBS Network News, Economist Mark Zandi, the chief economist for Moody’s, unwittingly revealed a central error of the global economic establishment. Zandi has made a career out of finding the middle ground between republican and […]

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In A Gold Standard, How Are Interest Rates Set?

Posted by Gonzalo Schwarz
June 7, 2012
in Blog

Submitted by Keith Weiner, President of the Gold Standard Institute, USA Today, short-term interest rates are set by the diktats of the central bank.  And long-term interest rates are set in a “market” in which the central bank is obliged to keep coming back to buy ever more bonds, and speculators front-run the central banks […]

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Is the Table Set for a Mania in Precious Metals?

Posted by Gonzalo Schwarz
June 7, 2012
in Blog

By Jeff Clark, Casey Research It may feel like I’m out of touch with the precious metals markets to broach the subject of a mania today, but I think the table is being set now for a huge move into gold and silver. There are, however, very valid reasons to reasonably expect a mania in our […]

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Is Global Finance a Ponzi Scheme? Ask a Russian Expert

Posted by Gonzalo Schwarz
June 6, 2012
in Blog

By Leonid Bershidsky  What’s the difference between today’s global finance system and a Ponzi scheme? This is the question that a 56-year-old veteran Russian financial scammer has been asking his victims. Chillingly, he almost has a point. Sergei Mavrodi is one of the most infamous names in Russia‘s recent history. Back in February 1994, amid the […]

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The CBO Will Need A Bigger Chart To Forecast Exponentially-Rising US Debt

Posted by Gonzalo Schwarz
June 6, 2012
in Blog

 “They’re gonna need a bigger chart!” Submitted by Tyler Durden Courtesy of previous Zero Hedge disclosures, namely that the CBO has been in the past bothperpetually and grossly overoptimstic (their 2001 forecast of 2011 public debt was negative $2.4 trillion; instead the real number was positive $10.4 trillion, a delta of only $12.8 trillion) as well as explicitly biased by political and financial […]

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Don’t Wait For the Announcement, QEIII is Already Here

June 5, 2012
in Blog

By Devin Roundtree Due to May’s disappointing unemployment numbers, Wall Street investors are again debating if the Federal Reserve will provide another round of Quantitative Easing. Yet nobody is recognizing the obvious; QE3 already exists. Ben Bernanke’s openness to the media has made people forget how secretive the Fed really is. Austrian economist Murray Rothbard […]

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The Hoarding Continues

Posted by Gonzalo Schwarz
June 4, 2012
in Blog

Submitted by Tyler Durden A month ago we were delighted to counterpoint Charlie Munger’s prior remarks about the level of “civilization” of a given consumer based on their sentiment vis-a-vis gold, by demonstrating that Chinese purchases of gold from Hong Kong rose to a record. To wit: “Imports from Hong Kong were 135,529 kilograms (135.53 metric tons) […]

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“I am not an Economist…”

Posted by Tyler Watts
June 1, 2012
in Blog

“…nor am I a doctor. But here is a critique of a school of economic thought, along with an appendectomy!”     “Donny, you’re out of your element.” Fans of the cult classic film “The Big Lebowski” will recognize this line used by the neurotic Walter (John Goodman) to put the scatterbrained Donny (Steve Buscemi) […]

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Time Bomb? Banks Pressured to Buy Government Debt

Posted by Gonzalo Schwarz
June 1, 2012
in Blog

“It’s not printing money, it’s ‘borrowing‘ money! See! We’ve totally learned from the mistakes of the past! This time it will be different!” by Jeff Cox US and European regulators are essentially forcing banks to buy up their own government’s debt—a move that could end up making the debt crisis even worse, a Citigroup analysis says. […]

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