Savings 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 readingFrank Shostak
How 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…
Continue readingCan Central Banks Avoid Booms And Busts With The ‘Right’ Amount Of Money Creation?
Within the framework of a free market, there cannot be such thing as “too little” or “too much” money, as long as…
Continue readingThe Neutral Interest Rate: The Fed’s Impossible Goal
The whole idea of the neutral interest rate is unrealistic. What the Fed is trying to establish is a level of interest rate that corresponds to…
Continue readingWhy The Boom Bust Cycle Keeps Repeating
The boom-bust cycle is somehow linked to the modern world. But what is the link? The source of the recurring boom-bust cycles turns out to be the…
Continue readingWhy We Need Savings To Produce What We Need
“Any so-called economic growth…can only be on account of the private sector that manages to grow the pool of real savings…”
Continue readingBoom-Bust Cycles, Easy Money, And The Gold Standard
Would the gold standard contribute to boom-bust cycles like the ones we see today as the result of printing money out of thin air? Here’s some insight…
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