Friday, 22 September 2017

Money

Knowledge Problem in Central Banking – Part II

August 3, 2017
in Blog

The previous post presented Hayek’s knowledge problem in the context of the economic calculation debate under socialism. We discussed the distinction (sometimes overlooked) between information and knowledge . To sum up, information is objective data such as quantities and prices. As a qualitative concept, information can be complete or incomplete. Knowledge is subjective data interpretation. As a qualitative concept, […]

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Knowledge Problem in Central Banking – Part I

August 2, 2017
in Blog

In my previous posts, Andreas Hoffmann and I discussed the problem of unintended consequences in monetary policy, particularly as applied to the U.S. Federal Reserve and the European Central Bank in the context of the 2008 crisis. This post tackles a related issue: the so called “knowledge problem.” This term was coined after Hayek’s engagement […]

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The Inflation Tax

Posted by Jerry Jordan
July 20, 2017
in Blog

Can you name an official at a major central bank who expresses worries that inflation is now, or soon will be, too high?  Can you identify any financial publication–even the Wall Street Journal–that does not report that recent inflation data have been “disappointing?” To paraphrase former President Nixon, are we “all inflationists now?” Twenty years […]

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The Regression Theorem: In Light of Bitcoin

Posted by William Luther
July 18, 2017
in Blog

In three previous posts, I have described the regression theorem, discussed its practical applications, and considered some misconceptions. In this post, I will consider the regression theorem in light of bitcoin. The discussion around bitcoin and the regression theorem usually focuses on whether bitcoin has some intrinsic worth (read: non-monetary use). If bitcoin is intrinsically […]

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The Regression Theorem: Misconceptions

Posted by William Luther
July 13, 2017
in Blog

In two previous posts, I described the regression theorem and discussed its practical applications. In this post, I will discuss some misconceptions. Misconception 1. The regression theorem only applies to a barter economy. In a recent article, Laura Davidson and Walter Block argue that the regression theorem is only applicable in a barter economy. It […]

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Money in Illiberalism

July 11, 2017
in Blog

A liberal society is governed by the principles of private property and freedom of contract, under the aegis of a nondiscriminatory rule of law.  In such a society, money enables economic actors to coordinate their activities.  Money allows producers and consumers to find common ground, as profit-and-loss accounting enables producers to compare various lines of […]

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Money in Liberalism

June 19, 2017
in Blog

One feature of a liberal society is that its institutions, and especially its formal institutions with coercive backing, are bound by a nondiscriminatory rule of law, and work to protect the sanctity of property and contract for all persons.  In such a society, the general laws of property, contract, torts, etc. govern the provision of […]

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Hayek on sensible monetary policy

Posted by Jerry Jordan
August 15, 2014
in Blog

Hayek on Sensible Monetary Policy This year marks the seventieth anniversary of the publication of “Road to Serfdom”by Frederick Hayek, as well as the fortieth anniversary of the award of the Nobel Prize in Economics to Hayek. Hayek’s enduring contributions to our understanding of the “Uses of Knowledge in Society”and characterization of markets as “mutualization […]

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Another Financial Meltdown on the Horizon

Posted by Gonzalo Schwarz
July 2, 2014
in Blog

Is there another financial meltdown on the horizon? Dr. Judy Shelton who co-directs the Atlas Sound Money Project surely believes so. In her latest article in The Hill Dr. Shelton warns about the “alarming disconnect between the performance of global equity markets, which are booming, and an underlying world economy that is merely limping along”. […]

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Thoughts on Jefferson and the Dollar at Monticello

Posted by Gonzalo Schwarz
February 11, 2014
in Blog

The following speech was given by Dr. Judy Shelton on January 30th, at the Jefferson Library in Thomas Jefferson’s Monticello: [Dr. Shelton] Thank you very much, very pleased to be here. It’s an honor to be introduced by Andrew O’Shaughnessy… I taught with your father, who is professor emeritus at the graduate business school at […]

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More Credit, More Money: Poland and the Euro-zone

Posted by Gonzalo Schwarz
November 11, 2013
in Blog

By Steve H. Hanke Money matters — it’s a maxim of Prof. Milton Friedman that I repeat often in my columns, and to my students in class. Since the Northern Rock bank run of 2007 — the “opening shot” of the recent financial crisis — the money supply, broadly measured, in Poland and the rest […]

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Antony Fisher: “governments shouldn’t be in the money business.”

Posted by Alex Chafuen
January 23, 2013
in Blog

Antony Fisher, founder of Atlas, the organization that hosts and administers www.soundmoneyproject.org, left us with good guidelines and principles. This from a speech in 1980: “Many studies need to be made. We need a series of studies by different and perhaps young academics elucidating monetary problems. History, logic and modern experience seem to indicate quite […]

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China: Money Matters

Posted by Gonzalo Schwarz
January 22, 2013
in Blog

By Steve H. Hanke Contrary to what the doomsters have been telling us, China’s economy is not on the verge of collapse. As the Wall Street Journal’s man in Beijing (and my former student), Aaron Back, reported: “China’s economic growth accelerated in the fourth quarter of 2012.” Indeed, China’s fourth quarter GDP growth rate came […]

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Money in Bad Faith

Posted by Gonzalo Schwarz
January 21, 2013
in Blog

The depredations of the Fed. by Judy Shelton The Federal Reserve is not your friend. Whether you reside on Wall Street or Main Street, whether you are a borrower or a saver, whether you lean toward the Tea Party or the Occupy Wall Street movement​—​or whether you simply believe in free markets and free people​—​loose […]

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“Fool’s Gold” Standards

Posted by Gonzalo Schwarz
November 12, 2012
in Blog

by John P. Cochran In a recent Mises Daily, “A Golden Opportunity,” Patrick Barron and Godfrey Bloom make the case for Germany to withdraw from the monetary union combined with a strong argument that “a golden Deutsche Mark is possible and desirable.” This recommendation may be a step in the right direction, but it leaves Germany with a central […]

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Paper Money or The True Gold Standard

Posted by Gonzalo Schwarz
November 1, 2012
in Blog

How does the United States once again establish, by statute, a dollar convertible to a defined weight of gold?  “If you have ever wondered how the world can get from here to there— from the chaos of depreciating paper to a convertible currency worthy of our children and our grandchildren—wonder no more. The answer, brilliantly […]

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Money Printing is the Only Thing Keeping the System Afloat

Posted by Gonzalo Schwarz
October 19, 2012
in Blog

By Alasdair Macleod Last Monday GoldMoney published my article showing the frightening growth in money-quantities for the US dollar. In that article I stated that the hyperbolic rate of increase, if the established trend is maintained, is now running at over $300bn monthly, while the Federal Reserve is officially expanding money at only $85bn. The first […]

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Money Mistakes

Posted by Gonzalo Schwarz
October 17, 2012
in Blog

  by Tom Woods As I noted not long ago, I find myself in serious disagreement with a portion of the end-the-Fed movement. This is the segment of the movement whose complaints are that the Federal Reserve is “privately owned,” that the Fed does not inflate enough, that interest payments are unjust or inherently unpayable […]

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HuffPo’s 11 Myths About the Fed, Refuted

Posted by Gonzalo Schwarz
October 15, 2012
in Blog

by Tom Woods and Bob Murphy The other day the Huffington Post ran an article by a Bonnie Kavoussi called “11 Lies About the Federal Reserve.” And you’ll never guess: these aren’t lies or myths spread in the financial press by Fed apologists. These are “lies” being told by you and me, opponents of the Fed. Bonnie Kavoussi […]

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What is Money? Krugman’s MMMF Question

Posted by Gonzalo Schwarz
October 9, 2012
in Blog

 by Mises Institute Faculty Let Me Google That for You By Mark Thornton Paul Krugman attacked Ron Paul, Paul Ryan, and “honest money” and also took a shot at Austrian economists on his blog recently. He called honest money a “Ron Paul dog whistle” and then went on to query Austrian economists on their position on money-market mutual funds […]

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Easy Money Is Punishing the Middle Class

Posted by Gonzalo Schwarz
October 5, 2012
in Blog

A policy of low but persistent inflation anesthetizes workers to declining real wages. By SEAN FIELER With the Republican Party committed to a gold commission and the Federal Reserve committed to easy money, a substantive debate about the principles underpinning our monetary system is finally in the offing. For sound money to carry the day, Republicans […]

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The Money Trap: Escaping the Grip of Global Finance – Reviewed

Posted by Gonzalo Schwarz
September 26, 2012
in Blog

Robert Pringle Basingstoke, UK: Palgrave Macmillan, 2012, 328 pp. To read Robert Pringle’s new book, The Money Trap, is to experience the slow joy of recognizing that someone out there in the world of intellectual propriety and academic correctness is willing to state the case that the global financial crisis can be traced in large […]

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Money: East vs. West

Posted by Gonzalo Schwarz
August 28, 2012
in Blog

By Steve H. Hanke A country’s money supply is made up of two distinct components. State money — the monetary liabilities of a central bank (typically referred to as base, or high-powered, money) — is one element, and is by far the smallest component of the money supply. The second and most important component of […]

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The Economist On Money and the State

Posted by Gonzalo Schwarz
August 22, 2012
in Blog

by George Selgin I couldn’t help being glad to see The Economist refer to Carl Menger’s theory of the origins of money just as I was about to explain that theory to my undergraduate classes. Nor did I at all mind having Menger’s ideas contrasted with those of another of my favorite economists, Charles Goodhart. I was, however, sorry to see […]

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Why Is the Price of Gold Falling?

Posted by Gonzalo Schwarz
August 20, 2012
in Blog

By Robert Wenzel: The Atlantic’s  Jordan Weissmann writes: Investors who love gold tend to think of it as a sort of bomb shelter. It’s supposed to be a secure place to park your money when the rest of the financial world is blowing up. So some may find it surprising that in a year when Europe’s troubles […]

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Money and the Coming World Order

Posted by Gonzalo Schwarz
August 1, 2012
in Blog

      Harold Van B. Cleveland (Author), Charles P. Kindleberger (Author), Lewis E. Lehrman (Author, Editor),David P. Calleo (Author, Editor), 1st Edition (Editor)   American and World prosperity depend on monetary reform, Federal Reserve reform, and restoration of international monetary order. Today, national economic policy making is largely concerned with the problems of unemployment and inflation. More precisely, it is their simultaneous […]

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Money, Where’s the Money?

Posted by Gonzalo Schwarz
July 23, 2012
in Blog

by Steve H. Hanke This article appeared in the August 2012 issue of Globe Asia. Since September 2007, when the British Government and the Bank of England bungled the Northern Rock affair, one government after another has sent in the boy scouts in an attempt to douse what has become an international economic wildfire. Their efforts […]

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Our Money is Dying

Posted by Gonzalo Schwarz
July 10, 2012
in Blog

by Chris Martenson of Peak Prosperity: A question on the minds of many people today (increasingly those who manage or invest money professionally) is this: How do I preserve wealth during a period of intense official intervention in and manipulation of money supply, price, and asset markets? As every effort to re-inflate and perpetuate the credit bubble is […]

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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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Sound Money for Our Troubles

Posted by Gonzalo Schwarz
April 19, 2012
in Blog

  by Kevin Rollins, Publisher, Free Liberal Fixing the Dollar Now: Why US Money Lost Its Authority and How We can Restore It, Judy Shelton’s new monograph, recently released by Atlas Network, argues a strategy for getting the US back to a reliable currency and away from the doom of debasement. For those not quite ready to […]

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Why Was the Federal Reserve System Created?

Posted by Gonzalo Schwarz
April 2, 2012
in Blog

Rep. Ron Paul sponsored this Congressional lecture on “Why Was the Federal Reserve Created?”, the introductory lecture in a three part series on the Federal Reserve System for Congressional staff. As a continuing educational tool this lecture was filmed and is provided to the public. The lecture was delivered by Dr. George Selgin, Professor of […]

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Problems Facing Every Monetary System

Posted by admin
March 30, 2012
in Blog

by Kurt Schuler Readers of George Selgin’s post just below should be aware that there is a an extensive comment section about it, including a few of his own remarks, over at Marginal Revolution. Now, on to what I promised to discuss in my last post, some time ago. Every monetary system faces a number of major […]

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What Does it Really Mean to “Peg” Money?

January 24, 2012
in Blog

For economics, money seems to be the exception to the rule, the thing that the market cannot provide by itself.  Therefore, it is said, the economist and the government must step into the market (in the form of a central banks and regulators) to manage the money supply and regulate the banking sector more skillfully […]

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What Is Interest?

Posted by Gonzalo Schwarz
December 22, 2011
in Blog

Consumers and entrepreneurs often speak of “the cost of money” when referring to interest rates. Modern lenders also refer to the interest they charge as “loan pricing.” Viewed this way, interest is viewed as if it were any other good. The cheaper a good the more affordable it is. And so the lower the interest […]

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What About Money Causes Economic Crises?

Posted by Gonzalo Schwarz
December 20, 2011
in Blog

Rep. Ron Paul sponsored this Congressional lecture on “What About Money Causes Economic Crises?”, the concluding lecture in a three part series on the basic principles of money for Congressional staff. As a continuing educational tool this lecture was filmed and is provided to the public. The lecture was delivered by Peter Schiff, CEO of […]

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Explaining Central Bank’s Gold Purchases

Posted by Gonzalo Schwarz
December 13, 2011
in Blog

The last two years marked a significant shift in central banks’ attitudes toward gold. Since 1988, central banks have been net sellers of the precious metal. Lacking convertibility of their paper currencies into the commodity, this occurrence makes perfect sense. Why hold a physical asset with costly storage fees when there is no risk that […]

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Life, Liberty, and Property by Fiat

Posted by Gonzalo Schwarz
November 22, 2011
in Blog

Because money is one side of every transaction, when a government usurps the market and turns lawful, sound money into fiat money and declares it to be legal tender, it has effectively gained control of all aspects of life that can be traded by use of money.  In a modern economy this essentially includes everything […]

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Dr. Salerno Delivers Inaugural Ron Paul Lecture on Money

Posted by Gonzalo Schwarz
November 7, 2011
in Blog

Dr. Joe Salerno, Academic Vice President of the Mises Institute, delivered the inaugural Ron Paul Lecture on Money on October 21st, 2011.  This was the first of a three-part “afternoon tea” series of lectures on the basic principles of money, sponsored by Congressman Ron Paul.     image courtesy of mises.org

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Money, Sound and Unsound

Posted by Gonzalo Schwarz
October 11, 2011
in Blog

“…Salerno’s yardstick concerns the soundness of money. He is speaking of a subject too rarely raised: the quality of the money itself. Money originated as a commodity out of market exchange. The further the government and central bank drive money from its original soundness, toward a paper money and finally toward digits that government can […]

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Is Gold Money in the U.S.? What is a Dollar?

Posted by Gonzalo Schwarz
August 30, 2011
in Blog

From the Federal Reserve: “’Is gold money?’ [Texas Congressman Ron Paul] asked.  Clearly bothered, [Federal Reserve Chairman] Bernanke told the representative, ‘No. It’s a precious metal.’” From the U.S. Mint: “Immediately afterward, Mint Director Fore held a ceremony on the auction floor to make the Double Eagle [gold coin] legal tender. ‘In order to monetize […]

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Return of the Gold Standard as World Order Unravels

Posted by Intern
July 18, 2011
in Blog

Article and photo originally found at The Telegraph, July 18, 2011, Ambrose Evans-Pritchard As the twin pillars of international monetary system threaten to come tumbling down in unison, gold has reclaimed its ancient status as the anchor of stability. The spot price surged to an all-time high of $1,594 an ounce in London, lifting silver […]

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A Bit of Sound Money: Can Trust Be Centrally Planned?

Posted by Gonzalo Schwarz
June 17, 2011
in Blog

Bitcoins (BTC) have found their way into the news recently, largely as a result of their association with the underground economy via the “Silk Road: Anonymous Marketplace,” and are very much worth examining in a forum dedicated to sound money. They are a completely decentralized, mostly anonymous, and very interesting new attempt to take on the […]

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“How Would the Invisible Hand Handle Money?” – Selgin and White

Posted by Tom Duncan
May 13, 2011
in Blog

“It is easy to note what is absent from a pure laissez faire monetary regime. There is no government control of the quantity of exchange media. There is no state-sponsored central bank. There are not legal barriers to entry, branching, or exit of commercial banks (or non-bank financial institutions, assuming any distinction can be drawn). […]

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Some light reading…

Posted by Gonzalo Schwarz
April 26, 2011
in Blog

For the next couple of weeks I will be unable to post a new article, but in the meantime if you would like to continue learning about sound money, inflation, and other related topics I encourage you to read: On The Origins Of Money By Carl Menger …In primitive traffic the economic man is awaking but […]

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“Monetary Reform: The Key to Spending Restraint” – WSJ

Posted by Tom Duncan
April 26, 2011
in Blog

“No man in America is a match for House Budget Committee Chairman Paul Ryan on the federal budget. No congressman in my lifetime has been more determined to cut government spending. No one is better informed for the task he has set himself. Nor has anyone developed a more comprehensive plan to reduce, and ultimately […]

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What Good Are Banks, Anyway?

Posted by Tyler Watts
April 4, 2011
in Blog

There’s plenty of frustration, irritation, and anger at banks during times of financial crisis and recession. Complaints run the gamut: bank over-exuberance (“predatory lending”) fueled the boom, and their under-exuberance (tight credit) contributes to the bust. They’re charging outrageous overdraft fees and being too harsh on loan defaulters. And oh yes, the taxpayer-funded bailouts! Why […]

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Robert Kiyosaki on Saving Money

Posted by Tom Duncan
April 4, 2011
in Blog

Robert Kiyosaki talks about his book, Rich Dad’s Conspiracy of the Rich: The 8 New Rules of Money, and the fall in value of money due to inflationary money printing. I have not read the book, but the video is a good one. Watch the video here. H/T to Romulo Lopez of Atlas. Image by […]

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