Author Archives: admin
Ben Bernanke Has Infinite Ammo
Plenty of very intelligent people seem to have trouble understanding the extent of the power of the Federal Reserve.
I was taken aback when someone suggested listening to an NPR Planet Money show about how the New York Fed spent over a trillion dollars buying mortgage backed securities.
The reporter sounded incredulous when she discovered that the [...]
Posted in Economics 2 Comments
Price Signals and Psychology
I’m not one of the cult that believes that the economy is entirely a psychological game. Reality asserts itself in time, no matter how much people want to fool themselves.
But orthodox, statist economics essentially believes that the role of the state is to “stimulate aggregate demand” to play the role of head magician in the [...]
Posted in Economics Leave a comment
What is it About Protectionism and Young People?
The New York Times Magazine published a curious article the other day about how 20-somethings – I’m 24 – are failing to enter the adult work force in large numbers. It’s a long article, but well worth reading all the way through.
This question pops up everywhere, underlying concerns about “failure to launch” and “boomerang kids.” [...]
Posted in Economics, Politics 2 Comments
Princeton, Harvard Academics Warn of Sovereign Crisis
Daniel Cloud, a post-doc at Princeton, recently published an essay about the sovereign debt crisis. He joins Niall Ferguson in waking up to reality – which is rather remarkable, seeing as the Ivy League has been wrong about just about everything for decades, if not centuries.
Seeing as he’s written for Grant’s Interest Rate Observer, whose [...]
The Erosion of the Left
The left wing in America attracts young idealists, academics, and Machiavellian intellectuals alike.
But with the erosion of popular support for the Obama presidency, that ideology has increasingly become less coherent.
Like the right wing, the left is less based on philosophical principles and more based on emotionally-driven stances. The left-wing base is often skeptical of war, [...]
Thoughts on Right-Wing “Free Market” Rhetoric
The right wing prefers to portray itself as the political force for free enterprise and strong national defense.
This is not even remotely true, and it never has been.
Newt Gingrich recently wrote an Op-Ed entitled How America became a ’secular-socialist machine.’
Neither statement is true. Secular organizations are taxed at punitive rates relative to religious “non-profit” ones. Under George [...]
Core Principle: What You Subsidize, Increases
When the government or banks subsidize something, the price of that good or service increases.
When such a subsidy is held indefinitely, the price also increases indefinitely.
While it may be true that a subsidy may make something more affordable to a certain class of consumer than it was in previous years, the overwhelming long term trend [...]
How to Play Savage Inflation
The Inflation Outlook
In February, Ben Bernanke said “We’re not going to monetize the debt.” during his testimony to Congress.
He recently contradicted his earlier pronouncement by proclaiming that the Fed would directly purchase at least $10 billion in Treasuries per month.
I consider this misleading. The Fed backstops all the major banks. If you count the bond [...]
Poxed Politics
George W. Bush managed to completely discredit his party and its associated ideology over eight years of misrule.
The government and the global financial system itself nearly endured a complete collapse in 2008 as a direct result of policies followed for over 20 years.
In order to restore the system, the executive branch and the Federal Reserve [...]
Banking Crises are Common Events