Should Investors Focus on Risk Rather Than Profit?
Proponents of the modern portfolio theory hold that diversification is the heart of investment. The key should be evaluation of the profitability and…
Continue readingFrank Shostak
We’re Headed Toward Stagnation (Unless the Fed Reins In Its Money Printing)
If money pumping can grow the economy, then why not pump plenty of it to generate massive economic growth?
Continue readingWhy Economics Cannot Be Understood through Experimentation
In the natural sciences, a laboratory experiment can isolate various elements and their movements. There is no equivalent in the discipline of economics…
Continue readingWant to Really Cut Taxes? Cut Government Spending
A cut in the income tax rate while government outlays continue to increase will lead the government to impose greater burdens in the future…
Continue readingThe Origins of the Dollar’s Value
The central bank’s paper certificates are fully backed by the bank certificates, which have the historical link to gold…
Continue readingSavings Are Critical to a Prosperous Economy
The heart of economic growth is the expanding pool of real savings. Monetary pumping destroys the flow of real savings and in turn…
Continue readingHow Central Banks And Lockdowns Are Making The Crisis Worse
Instead of the government presenting us with “Stay Home” advice, we should be presenting them with “Do Nothing” advice. Here’s why…
Continue readingWe Can’t Just “Restart” the Economy Where We Left Off
The imposition of lockdowns to counter the spread of the infection from the coronavirus is likely to severely damage the real economy. As a result…
Continue readingPeople Are Seeking Answers From The Government, But Bureaucrats Can’t Fix This
The government has no money of its own, and monetary pumping won’t help ailing businesses, but this will…
Continue readingSavings Vs. Money: Which Is More Important?
Any so-called economic growth within the framework of loose monetary policy can only take place if the private sector manages to…
Continue readingWhy Central Banks Aren’t Really Setting Interest Rates
The idea that interest rates are determined by the central bank does not make much sense. If one accepts that this is the case, then how…
Continue readingEasy-Money Policies Don’t Solve The Problem Of Idle Resources
It is widely believed that resources that are utilized in normal times to promote economic prosperity become underutilized during recessions…
Continue readingExports: Currency Devaluation Won’t Grow The Economy
Any tampering with the currency rate of exchange can only make things much worse as far as the allocation of scarce resources is concerned…
Continue readingDon’t Want A Liquidity Trap? More Saving Is The Answer
Contrary to popular thinking, a liquidity trap does not emerge in response to consumers’ massive increase in their demand for money but comes as a result of…
Continue readingWhy The Pursuit Of Profit Makes Us All Better Off
In most cultures, profit is seen as the outcome of exploitation, Hence, anyone who is seen as striving to make profits is regarded as…
Continue readingMoney Printing Can’t Replace Saving & Production As The Real Engine Of Economic Growth
Bubbles, booms, and eventual crashes result…
Continue readingThe Fed Chairman And The Phillips Curve
The Fed is trying to justify the lowering of the interest rate target thus setting in motion a further misallocation of scarce real wealth.
Continue readingWhen Will The Stock Market Respond To 2016’s Liquidity Collapse?
The increase in the US stock market this year appears to defy the visible softening in the momentum of various economic data…
Continue readingLow Price Inflation Means the Fed Will Retreat to Low Rates and Easy Money
2% inflation allows the Fed to reach a real interest rate of minus 2% while maintaining nominal rates at 0%, which clearly could stimulate economic growth…
Continue readingLow Inflation Is No Threat to the Economy
For instance, when the inflation rate is minus 1% and the nominal interest rate is 0% then the…
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