| |
 | Frank Shostak |
 Why It's Important to Define Money Correctly |
| Most economists hold that, since the early 1980s, correlations between various definitions of money and national income have broken down. The reason for this breakdown, it is held, is that financial deregulation has made the demand for money unstable. As a result it is held the usefulness of money as a predictor of economic events has significantly diminished.To fix the instability of the demand for money, economists have introduced a gauge of the money supply known as the Divisia monetary indicSunday, November 15, 2020 |
|
| Frank Shostak |
| There Are Two Types of Credit — One of Them Leads to Booms and Busts |
| In the slump of a cycle, businesses that were thriving begin to experience difficulties or go under. They do so not because of firm-specific entrepreneurial errors but rather in tandem with whole sectors of the economy. People who were wealthy yesterday have become poor today. Factories that were busy yesterday are shut down today, and workers are out of jobs.Businessmen themselves are confused as to why. They cannot make sense of why certain business practices that were profitable yesterday areSunday, November 1, 2020 |
|
 | Alasdair Macleod - Finance and Eco. |
The fiat money quantity (FMQ)  |
| Summary : This paper seeks to establish a measure of currency quantity that helps economists identify and estimate the risk that confidence in fiat currencies might be significantly eroded or even vanish altogether. It is this phenomenon that was referred to in the great European currency inflations of the 1920s as Katastrophenhausse, or a crack-up boom, when ordinary people lose all confidence in a fiat currency, disposing of it as rapidly as possible instead preferring ownership of goods.This isThursday, September 17, 2020 |
|
| Frank Shostak |
| How Much Money should there be |
| Most economists believe that a growing economy requires a growing money stock, on grounds that growth gives rise to a greater demand for money which must be accommodated. Failing to do so, it is maintained, will lead to a decline in the prices of goods and services, which in turn will destabilize the economy and lead to an economic recession-or, even worse, depressionSaturday, June 6, 2020 |
|
 | George F. Smith - Barbarous Relic |
| Who said it, when and where |
|
Over the years I've accumulated a long list of quotes about money and banking extracted from online articles and books I've read.Unlike most other sites that post pithy remarks from famous authors, I include hyperlinks to their sources, so that anyone who wishes can not only verifya quote but, perhaps more importantly, read the context in which it was used.Wednesday, May 20, 2020 |
|
 | Robert Blumen - 24hgold |
| Real Bills, Phony Wealth |
| "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 been resurrected under many guises, but all with the same error at its core: that printing money can create real wealth.Wednesday, May 13, 2020 |
|
| Alasdair Macleod - Finance and Eco. |
| Debts, Bastiat and modern economics |
| There is a well-worn conundrum told about a stranger, who walks into the hotel in a remote, sleepy village in Mexico, and reserves a room for the night, paying 1,000 pesos in advance. The innkeeper rejoices at this unexpected turn of events, for the village is remote, few people have any reason to go there, and there is very little money. The innkeeper goes to the village butcher, to whom he owes 1,000 pesos, and discharges his debt. The butcher takes the 1,000 pesos and pays it to the farmer, wThursday, May 25, 2017 |
|
| Frank Shostak |
| Tightening the Money Supply will Inevitably Lead to a Bust |
| Fed policymakers are of the view that the correct interest rate policy could bring the economy onto a path of economic stability and low price inflation. The idea is to guide interest rates toward what is called the “natural” interest rate. The natural rate is believed to be one that is consistent with stable prices and a balanced economy.What is required then is that Fed policymakers successfully target the federal funds rate toward this natural interest rate.One of the tools that policymakersSaturday, February 4, 2017 |
|
| Frank Shostak |
 Should Cash be Abolished |
| At the World Economic Forum in Davos Switzerland, Joseph Stiglitz the Nobel Prize-winning economist argued in favor of phasing out currency and moving toward a digital economy.The view expressed by Stiglitz is similar to that of former IMF chief economist Kenneth Rogoff who has been arguing for many years that there is an urgent need to remove cash from the economy. It is held that cash provides support to the shadow economy and permits tax evasion. Some estimates suggest this could be up to $70Monday, January 30, 2017 |
|
| Frank Shostak |
| Why Are Dollar Bills Worth Anything |
| Why are the dollar bills in people's pockets worth anything? According to some experts, the dollar bills carry value because the government in power says so. Other experts are of the view it is because people are willing to accept it as payment.To say that the value of money is on account of the government or on account of social convention is to say very little. In fact, what experts are saying is that money has value because it is accepted, and why is it accepted? … Because it is accepted!TheThursday, December 22, 2016 |
|
| Frank Shostak |
| Keynes Would Have Loved Trump's Economic Plan |
| Trump’s plan is what Keynes would have prescribed!Most economic commentators such as a Nobel Laureate Paul Krugman should be delighted with the US president-elect Donald Trump’s economic plan for it is going to be along the lines of Keynesian economics.One of Trump’s promises is a massive infrastructure spending program. According to Trump,We are going to fix our inner cities and rebuild our highways, bridges, tunnels, airports, schools, hospitals. We’re going to rebuild our infrastructure, whicMonday, November 21, 2016 |
|
 | Mish - Global Economic Analysis |
| Hyperinflation Silliness (Times Two) |
| The hyperinflation proponents are back at it. This time in two parts, led by Jeff Nielson.
The most absurd part of Nielson’s claim is his statement “Hyperinflation has already occurred“. His claim is in reference to the US, not Zimbabwe.
Allegedly Nielson provides “proof“. Let’s take a look.
In Hyperinflation Defined, Explained, and Proven: Part I, Nielson defines inflation as an “increase in the supply of money”.
That’s a reasonable starting point, but in a fiat-based credit society in which wSunday, August 7, 2016 |
|
 | Ed Bugos |
| It’s The US Dollar, Stupid! |
| Don’t let the bull-tards tell you the stock market over here is falling because of China’s problems, or Grexit, or fear of the nebulous Fed rate hike.
We’ll just see about that last one now anyway!
The US asset bubble is the biggest one on the planet today, and it just went pop. The currency too has rallied over the past few years on the fairy tale that everyone else is inflating while the US is about to tighten, which may have been more plausible if they just started telling it now, and the dFriday, August 28, 2015 |
|
 | Steve Saville - Speculative Investor |
| Any quantity of money is just fine |
| Some comments by John Mauldin towards the bottom of a recent article reflect popular opinions about money that can be summarized as: "a growing economy needs a growing money supply" and "there isn't enough gold in the world for gold to be used as money today". These opinions reflect a basic misunderstanding about money.Here are the Mauldin comments to which we are referring. We've put notes below each excerpted comment, but the main part of our response is further down the page."The current struWednesday, December 10, 2014 |
|
| Mish - Global Economic Analysis |
| Will Prices Rise Significantly When Velocity of Money Picks Up |
| Several people have written recently telling me that price inflation is under control only because the velocity of money (the alleged rate at which money circulates) is falling.
Reader Mark pinged me with this statement "Falling velocity is deflationary. It indicates people are saving their cash." Others have expressed similar opinions, typically in reference to this chart by the Fed.
Velocity
Discussion of Ratios
That chart looks ominous. Is it?
First, please note the chart says velociMonday, March 31, 2014 |
|
| Ed Bugos |
| Making Sense of Chaos in the Bread Basket: Analysis |
| History was made in Ukraine this weekend as an overwhelming majority of Crimean slaves (96%; turnout of 83%) self-determined that they wanted to pay tribute to the Russian oligarchs instead of the Ukraine oligarchs.
The Crimean parliament passed a bill to adopt the inflation prone Ruble as their currency practically right away, and Russia subsequently incorporated the peninsula, amid jeers and howls from the west.
On March 1st, another eastern Ukraine city, Donetsk, voted to have a referendumFriday, March 21, 2014 |
|
| Ed Bugos |
| It’s the Fed, Stupid |
| “The Federal Reserve’s proposed timetable for tapering its $85 billion-a-month bond-buying program is not set in stone, Chairman Ben Bernanke said on Wednesday in fairly dovish prepared remarks to a Congressional panel. “I emphasize that, because our asset purchases depend on economic and financial developments, they are by no means on a preset course,” Bernanke said in remarks prepared for delivery to House Financial Services Committee.”
And up went the stock and bond markets again, just whenSaturday, July 20, 2013 |
|
| George F. Smith - Barbarous Relic |
| Fiscal Cliffs and Monetary Mountains |
|
On September 13, economist Frank Shostak had anarticleon Mises.org about the upcoming “fiscal cliff,” which he explains this way:
The "fiscal cliff" refers to the impact of around $500 billion in expiring tax cuts and automatic government-spending reductions set for 2013 as a result of successive failures by Congress to agree on some orderly alternative method of reducing budget deficits.Monday, September 17, 2012 |
|
 | Douglas French |
| Debtor Nation |
| Wednesday, July 27, 2011 |
|
| Robert Blumen |
| US To Return to Gold Standard. Really |
|
Publisher Steve Forbes, speaking to Human Events predicts "a return to the gold standard by the United states within the next five years." Why? Because it would "help the nation solve a variety of economic, fiscal, and monetary ills."
The article continues:
Such a move would help to stabilize the value of the dollar, restore confidence among foreign investors in U.Friday, July 15, 2011 |
|
|
