news.goldseek.com >> 8 November 2009
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news.goldseek.com >> 8 November 2009 |
What Is Money? Part 13: Exported Inflation
By: Gary North
When you hear about America's exported inflation, be sure you distinguish Manuel Labor from Exxon. Be sure you distinguish paper currency sent abroad from digits held in New York banks. In the first case, inflation is exported, and the result is deflation in America. In the second case, inflation stays at home. So does most of the money. Ownership changes. The money supply rises in the United States when the Federal Reserve buys any asset, but that money is not exported. It just changes hands, which of course are not hands. They are computers.
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news.goldseek.com >> 6 November 2009 |
Reserve Bank of India’s Gold Purchase From the IMF
By: Michael S. Rozeff
Viewed in this context, U.S. fiscal and monetary policies seem grotesquely out of step with reality. Yet another bout of massive inflation and debt creation in order to "create" a buoyant economy does nothing to address the basic political economic issues. While America ponders further socializing health care and further controlling and taxing energy use, it continues to debase its currency.
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news.goldseek.com >> 4 November 2009 |
What Is Money? Part 12: Why Central Banking Persists
By: Gary North
To call for the abolition of central banking in the name of economic theory is to call for the abandonment of economic theory. It means calling for expensive political mobilization against an unknown institution. It means imagining that someone will put up the money to change millions of voters' minds. Who will do this? Why? What results can he legitimately expect?
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news.goldseek.com >> 2 November 2009 |
What Is Money? Part 11: The Great Default
By: Gary North
The governments of every major nation are going to default on their debts. There are two relevant questions: (1) How? (2) When?
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news.goldseek.com >> 28 October 2009 |
What Is Money? Part 10: When Money Dies
By: Gary North
Bottom line: "When money dies, so do people." Hyperinflation in a modern urban nation would kill people. I think it would kill a lot of people.
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news.goldseek.com >> 27 October 2009 |
Zero Discount Value of Gold in the Total Banking System
By: Michael S. Rozeff
The U.S. banking system has many banks with large amounts of bad loans on their books. How do these bad loans affect the value of the dollar and gold? Specifically, how do they affect the Zero Discount Value (ZDV) of gold?
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news.goldseek.com >> 25 October 2009 |
What Is Money? Part 9: Monetary Reform
By: Gary North
An obvious response to the information that I have presented in the first eight parts of this series is this: "What should we do to reform the system?" This is a nice sentiment. It ignores the obvious: "we" have nothing to say about monetary reform.
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news.goldseek.com >> 23 October 2009 |
What Is Money? Part 8: Why Gold Has No Intrinsic Value
By: Gary North
The more unreliable the decisions of the central bankers, the more upset the economists are with owners of gold. They do not want the price of gold to rise. Such an increase would signal a voice of protest by a small group of private citizens. If you would like to protest the extension of centralized government power over your life and society in general, buy a few gold coins. I like protests that can turn a profit. This is such a protest.
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news.goldseek.com >> 20 October 2009 |
The Zero Discount Value of Gold and Dethroning the Dollar
By: Michael S. Rozeff
A truly major change in the global monetary system is beginning to materialize. The dollar is starting to be dethroned. Foreign governments and central banks are going to do the dethroning.
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news.goldseek.com >> 18 October 2009 |
What Is Money? Part 7: Gresham's Law
By: Gary North
Gresham's Law, properly understood, is a real phenomenon. When a government threatens violence against currency traders for daring to make an exchange at a rate not mandated by the government, there will be a glut of the overpriced currency and a shortage of the underpriced currency in that jurisdiction. The result will be decreased trade across borders. There will be shortages of goods on both sides of the border. Most people's wealth will decline as a direct result of reduced trade.
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news.goldseek.com >> 12 October 2009 |
What Price Gold?
By: Michael S. Rozeff
I recently received an e-mail asking about the price of gold. This person presented two gold-pricing models in the body of the e-mail along with an estimate of what price gold might command in the future in dollars. Let’s examine the gist of what he wrote and provide an extended reply.
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news.goldseek.com >> 8 October 2009 |
Divorcing the Dollar and Marrying Gold
By: Michael S. Rozeff
With their money and banking system having presented them with a case of system failure by disintegrating before their eyes and taking the economy with it, America’s economic experts who support and run the FED’s central banking–inconvertible paper dollar system cannot place the blame for this where it belongs, which is on the system itself, its supporters, and those who make its policies.
What Is Money? Part 4: Bait and Switch
By: Gary North
The phrase "bait and switch" refers to a sales practice of advertising a desirable item at a low price to get potential buyers into a showroom. Then the salesman tells the shopper that the firm has run out of the sought-after item. The salesman then uses his sales skills to sell the shopper a more expensive item. This practice is illegal. It is a form of fraud. It steals time from the shoppers. Bait and switch is at the heart of all fractional reserve banking. It is not illegal. It is the heart of the modern economy.
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news.goldseek.com >> 7 October 2009 |
What Is Money?
By: Gary North
If monetary theory is accurate, it is a subset of general economic theory, which must also be accurate. Monetary theory is not an independent theory of human action that is divorced analytically from a general theory of human action.
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news.goldseek.com >> 1 October 2009 |
What Is Money?
By: Gary North
A gold coin standard or silver coin standard provides continuity that fiat money systems do not provide. Such a standard makes life difficult for counterfeiters. This is why governments do whatever it takes to substitute a fiat currency unit for a precious metals coinage. The government wants to benefit as the nation's monopolistic counterfeiter. It will share this only with commercial banks and the central bank. It does this only because the central bank promises to be the lender of last resort to the national Treasury.
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news.goldseek.com >> 30 September 2009 |
Fractional Reserve Banking Made Easy
By: Terence Gillespie
The paper bills in our wallet are not money. And they are not Notes as in "Federal Reserve Note" written on the top of the bill. They are actually just Tokens. Federal Reserve Tokens, if you like, is what should be written on top of the bills. They are not redeemable for anything other than themselves. And they represent only one thing: Your belief in their value. Hopefully, your belief extends to the next person you try to give them to.
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news.goldseek.com >> 29 September 2009 |
What Is Money?
By: Gary North
This question divides economists even more than it divides voters. Voters do not think much about this question. Economists think about it throughout their careers. They do not agree with each other regarding the answer.
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news.goldseek.com >> 28 September 2009 |
My Day Among the Tax-Eaters
By: Thomas E. Woods, Jr.
Last week I testified before the House Financial Services Committee in support of HR 1207, the Federal Reserve Transparency Act of 2009. Speaking on behalf of HR 1207 is particularly tricky because (1) what the Fed might be up to is entirely speculative, and thus can hardly be admitted into testimony; and (2) the bill is not opposed to the Fed per se, so arguments about the Fed’s performance as an economic stabilizer are also out of bounds (unless a congressman happens to raise them).
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news.goldseek.com >> 25 September 2009 |
Audit the Fed
By: Thomas E. Woods, Jr.
Testimony in Support of HR 1207, The Federal Reserve Transparency Act of 2009, House Financial Services Committee, September 25, 2009.
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news.goldseek.com >> 23 September 2009 |
One Fine Day
By: Michael S. Rozeff
Since the government and central bank are once again inflating the economy, let’s look back at what happened the last time they did this.
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news.goldseek.com >> 21 September 2009 |
Nuclear No-Contest
By: James P. Hogan
For reasons that have mainly to do with politics and the media's thirst for sensationalism, nuclear energy has been a subject of much disinformation and alarmism for several decades. In fact, nuclear is safer, cleaner, and potentially cheaper and more abundant than any other proven source of energy that the human race has come up with. But beyond this, its real significance is that it represents the next natural step in the evolutionary progression that has marked the history of energy development.
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news.goldseek.com >> 16 September 2009 |
Gold Is Money
By: Greg Canavan
Gold's recent breach of the symbolic US$1,000 level has elicited a predictable amount of commentary from mainstream analysts. The problem is, much of it is ill-informed. Due to the general amnesia of most market analysts, of all asset classes gold remains the most misunderstood. In order to comprehend why gold is rising and why it will continue to rise in the years ahead, we need to review some history.
The Third Rail of Academia
By: Gary North
The Social Security system has long been described as the third rail of American politics. "Touch it, and you die." You get electrocuted. If you should somehow survive, the next subway train will cut you in pieces. There is such a rail in academia: the Federal Reserve System.
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news.goldseek.com >> 9 September 2009 |
The Great Fakeroo Recovery
By: Llewellyn H. Rockwell, Jr.
There is something affected, something not believable, something agitpropish, about all the cheers for the glorious economic recovery we are experiencing. Some of its biggest boosters don't even quite believe it.
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news.goldseek.com >> 3 September 2009 |
Deficits Will Matter
By: Gary North, Lew Rockwell
The defenders of supply-side economics have regaled conservatives with this slogan, "deficits don't matter," from the late 1970's until today. As far as I can determine, this was the only idea to come out of the supply-side movement that was ever agreed to by the mainstream Keynesians and Chicago School economists. They all agree: Federal deficits don't matter. Someday, yes, but not yet. Not now. Don't worry. Be happy.
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news.goldseek.com >> 31 August 2009 |
The Fed on the Defensive
By: Gary North
I do not recall this in my lifetime. A majority in the House of Representatives has co-signed H.R. 1207, a bill introduced by Ron Paul to have the Federal Reserve System audited by an independent government agency, the Comptroller General's office.
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news.goldseek.com >> 20 August 2009 |
Sound Money: The Impossible Dream?
By: Floy Lilley
Our gold standard money didn’t fail us in 1913; it was murdered. Did it deserve to die? What was its crime? It had provided us with nothing less than relative peace and prosperity over a span of 136 years. It had not only retained one hundred percent of its value, it had gained eleven percent. That’s right. The dollar we started with in 1776 bought us eleven percent more after almost seven generations. Then, J.P. Morgan’s creatures picked a quiet 23rd of December in 1913 to suffocate our sound money system. Since that manslaughter, the purchasing power of a dollar has plummeted over 95%. We now pay twenty times more than J.P. Morgan did for any item.
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news.goldseek.com >> 12 August 2009 |
Pink Slip Nation
By: Gary North
I don't know when the term "pink slip" originated. The term is at least a century old. It refers to a "your fired" notice. The American economy shows no signs of reversing its relentless increase in the rate of unemployment. Jobs are disappearing at a rate not seen since the 1981–82 recession.
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news.goldseek.com >> 11 August 2009 |
Hit-and-Run: How the Government's Billion-Dollar Cash for Clunkers Boondoggle Hurts the Poor
By: Gary North
Back in the recession of 1958, one solution offered by the car industry was this: "You auto buy now." Get it? Auto. Ought to. Someone got paid a bonus for that slogan. There were others. Same theme: save the economy by buying a new car. Do your patriotic duty. Back then, the government did not get involved. That was then. This is now.
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news.goldseek.com >> 2 August 2009 |
Why Bernanke Is in Panic Mode
By: Gary North, Mises on Money
Usually, when Ben Bernanke is interviewed, he has the demeanor of a college professor in the presence of freshman students. Of course, as a full professor, he did not have to teach freshmen. That is for untenured assistant professors to do. Stammering and stuttering are therefore a real departure for him. There is a reason for this.
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news.goldseek.com >> 31 July 2009 |
Bernanke’s Collectivism
By: Michael S. Rozeff
Mr. Bernanke is the world’s premier central banker. He is a very smart man with a stellar academic record. He has carried the ways of the seminar into the FED. He thinks about central banking a great deal, and he lets us know what he thinks.
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news.goldseek.com >> 30 July 2009 |
A Very Few Elements of Gold Strategy
By: Michael S. Rozeff
Gold strategy depends on age, wealth, anticipated labor income, one’s expectations, and risk preferences, among other things. A complete gold strategy covers alternative metals, alternative ways to own gold, and shares in metal and mining companies.
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news.goldseek.com >> 27 July 2009 |
23.7 Trillion Reasons To Buy Gold
By: Michael S. Rozeff
American government has one good thing about it. It has Inspector Generals. The government ignores what they say, but at least they give us a measure of truth about government. The truth these days on the extent of government bailouts is undeniably mind-boggling. It may make you feel queasy. It may set off alarm bells.
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news.goldseek.com >> 26 July 2009 |
Mass Layoffs: The Continuing Devastation
By: Gary North
Stock market investors shrug off a disaster in our midst: mass layoffs. Investors act as though it will soon be business as usual. Companies cut costs by firing employees that have been with them for decades. Then the companies can report higher earnings from cost-cutting measures. The media then proclaim an increase in earnings. But how will these increases be sustained? How will an unemployment rate of 11% help get the economy back on its feet?
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news.goldseek.com >> 24 July 2009 |
The Record of the Federal Reserve
By: Erik Voorhees
From 1776 to 1912 (136 years), the value of the dollar, relative to the Consumer Price Index, increased by 11%. A dollar could buy 11% more goods in 1912 than in 1776. Thus, if in 1776, you sat on your savings pile of $1,000,000 for 136 years, it would then be worth $1,110,000 in purchasing power (it will have appreciated in value by 11%). A loaf of bread for Thomas Jefferson cost the same as a loaf of bread for Lincoln 50 years later and again the same for J.P. Morgan 50 years after that.
The FED: No Exit
By: Michael S. Rozeff
The FED has changed enormously in the past nine months. Between last September and now, Reserve Bank credit has gone up 135 percent. Will the FED change back to what it used to be? Does it have a workable exit strategy? Very, very doubtful.
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news.goldseek.com >> 23 July 2009 |
Bernanke Sidesteps the Three Big Questions, Again
By: Gary North
In a recent international Bloomberg poll, Bernanke was rated by investors as the greatest central banker, the man who saved the world's economy. All it took was a doubling of the monetary base and $3 trillion – as of today – of government bailout money.
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news.goldseek.com >> 22 July 2009 |
When Atlas Shrugs: The Great Default
By: Gary North
Have you ever heard this argument? "The national debt is too high. We are laying an enormous burden onto our children." It is misleading. In what way? Because our children, like Atlas in Ayn Rand's novel, will shrug. They will send Congress a message: "No more."
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news.goldseek.com >> 15 July 2009 |
Why Gold's Price Rose in the Great Depression
By: Gary North
I keep coming back to this theme because the non-Keynesian, hard-money deflationists keep pitching the same old deliberately deceptive statement: "Gold's price rose in the Great Depression." They tell their readers to buy gold.
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news.goldseek.com >> 13 July 2009 |
How To Create a New World Reserve Currency
By: Gary North
For several months, there have been news reports of announcements by bureaucrats in China and politicians in Russia about the need for a new reserve currency to replace the U.S. dollar. One suggestion: substitute the non-currency known as the SDR (special drawing rights) of the non-governmental, non-central bank IMF (International Monetary Fund).
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news.goldseek.com >> 25 June 2009 |
Obama's Fix-It Plans
By: Llewellyn H. Rockwell, Jr.
The entire presumption of the Obama-proposed Consumer Financial Protection Agency is that banks and mortgage companies are under-regulated by the state. This is why the financial meltdown took place – never mind that the federal regulatory Gosplan includes tens of thousands of pages purporting to regulate the mortgage industry alone.
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news.goldseek.com >> 21 June 2009 |
Pushing on a String
By: Gary North
Back in 1973, gold standard advocate John Exter made a phrase famous in hard-money circles: "Pushing on a string." Exter argued that prices of all assets except gold (he ignored silver) would someday collapse because of the pyramiding of debt. Banks would eventually cease to lend, out of fear of default. That would cause the default.
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news.goldseek.com >> 19 June 2009 |
The Federal Reserve System's Party Line
By: Gary North
I monitor statements by senior officials of the Federal Reserve System. There are supposedly "hawks" among the regional Federal Reserve banks – privately owned banks. These "hawks" oppose the "doves." The "doves" are always ready to inflate. The "hawks" are always ready to remind the "doves" that inflation may be a problem one of these days, but not yet. Then the "hawks" vote with the "doves" to expand the monetary base.
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news.goldseek.com >> 14 June 2009 |
Bankers Are Scared. Are You?
By: Gary North
Those who predict price inflation believe that the money multiplier will turn upward again. They just don't know when. Those who predict price deflation believe that the money multiplier will not turn upward again. Indeed, it must fall much further. Prices are close to stable today. To get to significant decline – 5% or more per annum – the money multiplier must continue its downward path. I am in the inflationist camp. But until I see a sustained reversal of the money multiplier, I will continue to predict relatively stable consumer prices.
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news.goldseek.com >> 10 June 2009 |
A Regional Central Banker Blows the Whistle
By: Gary North
The FED is on the back of the tiger. Hoenig sees this. He knows the financial system remains fragile. I presume that he knows that the only way to keep it solvent is for the FED to refuse to sell its assets to the general investment community. Bernanke knows this, too.
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news.goldseek.com >> 8 June 2009 |
Around With Ludwig
By: Chris Clancy
I’m coming to the end of the third year of my journey into Austrian economics. At times it has become almost obsessive as so much of what I believed before has been turned on its head. Its been a bit like playing a new golf course – one which has been cunningly designed with all sorts of traps and hazards – to play this course properly a new approach is needed.
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news.goldseek.com >> 4 June 2009 |
Fail, Fail, Fail, Fail
By: Llewellyn H. Rockwell, Jr.
How about a bit of reality? Not the ridiculous promises from Washington, the absurd talk of "green shoots" while unemployment soars and investment falls, the silly guarantees that GM has a bright future even as its stock price falls to less than the price of a Snickers bar, the nonsense about how if we spend more and inflate more. Recovery will come tomorrow morning.
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news.goldseek.com >> 2 June 2009 |
The Austrian Cure for Economic Illness
By: Donald W. Miller, Jr., MD
As in medicine, with its opposing schools of allopathic (pharmaceutically oriented) medicine and homeopathy, there are two diametrically opposed schools of economics: the Keynesian one and the Austrian School of economic thought. Based on the ideas of the John Maynard Keynes (1883–1946), a British economist, Keynesian economics is the one government officials, academic experts, pundits, journalists, editors, and establishment economists follow.
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news.goldseek.com >> 31 May 2009 |
The 'No Problem' Mindset: Guaranteed Destruction
By: Gary North, Mises on Money
We live in today's world. It's bad, but it's not a catastrophe. We must keep our heads above water.
A Tsunami is coming. In such a scenario, you have got to get out of the water and off the beach. But few people ever do, unless they have seen a tsunami. Few have.
Allocate some percent of your wealth to tsunami-avoidance. Do it quietly. Do not discuss this with your big-mouth brother-in-law.
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news.goldseek.com >> 26 May 2009 |
Romer, Bernanke, and the Flying Donkeys
By: Glenn Jacobs
It seems as if Romer, Bernanke, et al. are proposing something new and revolutionary – inflate the money supply and devalue the currency. Genius! But there is a big problem. This solution is neither new nor revolutionary. Although it has never before had as fancy a euphemism as "quantitative easing," the practice of monetary devaluation is ancient and is standard government operating procedure. Unfortunately, it has also proven a disaster everywhere it has been implemented.
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news.goldseek.com >> 13 May 2009 |
Sucker's Rally, Not Green Shoots
By: Gary North, Mises on Money
The rally has been based on the rise in bank stocks. To understand the rise in bank stocks, you must understand the stress test. Saturday Night Live understands this quite well.
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news.goldseek.com >> 11 May 2009 |
The Meaning of Quantitative Easing
By: Michael S. Rozeff
I begin by describing quantitative easing in technical terms. I go on to describe what it means when a central bank and its government engage in quantitative easing. What is quantitative easing? It is a central bank’s "purchase" of government securities (bills, notes, bonds) directly from the government.
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news.goldseek.com >> 8 May 2009 |
No, the Free Market Did Not Cause the Financial Crisis
By: Thomas E. Woods, Jr.
In March 2007 then-Treasury secretary Henry Paulson told Americans that the global economy was “as strong as I’ve seen it in my business career.” “Our financial institutions are strong,” he added in March 2008. “Our investment banks are strong. Our banks are strong. They’re going to be strong for many, many years.”
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news.goldseek.com >> 4 May 2009 |
Gold-Exchange Standard, Gold, and Monetary Freedom
By: Michael S. Rozeff
Two major government economists, Christina D. Romer and Ben Bernanke, have done influential research on the Great Depression. Both implicate the State-run gold standard of that era, which differed from the pre-1914 gold standard, as a major culprit in the Great Depression. (See here and here.) Their work parallels that of other economists such as Barry Eichengreen and Peter Temin on the negative role of the interwar gold exchange standard. There is an emerging or existing consensus among economists about the negative effects of the gold-exchange standard. Still, research continues.
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news.goldseek.com >> 30 April 2009 |
Fiscal and Monetary Policy Annoy Me
By: Michael S. Rozeff
The terms "fiscal and monetary policy" annoy me. The fact that fiscal and monetary policy even exist annoys me. They are the terms that mean government control over the economy. That annoys me too.
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news.goldseek.com >> 22 April 2009 |
Credit Welfare and the FED
By: Michael S. Rozeff
I’d like to extend my remarks on Donald Kohn’s recent speech in Nashville, because here we have a top FED official clearly outlining the FED’s recent actions and, to some extent, trying to justify them. His speech makes clear what the FED has done and why it has done it.
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news.goldseek.com >> 21 April 2009 |
Defending the FED’s Power With Myths
By: Michael S. Rozeff
Donald L. Kohn is a powerful man, as Vice-Chairman of the Board of Governors of the FED. He shouldn’t have this power. Nor should the FED have the power it has. Not under the U.S. Constitution. Not in a nation of free men and women. And not if we want a sound economy.
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news.goldseek.com >> 16 April 2009 |
Robert Shiller’s Fatal Prescriptions
By: Michael S. Rozeff
Shiller proposes the massive expansion and extension of the State into the American economy "to get us out of the current economic slump, and to restore confidence." This is utter nonsense. The economy would not have tumbled and would long since have been recovering had the government stayed out of it altogether. American confidence is legendary. Americans are ready at any time to take and manage risks. Only concerted government policies can bypass and undermine this American characteristic.
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news.goldseek.com >> 15 April 2009 |
94 Years of Serfdom
By: Paul Craig Roberts
This April 15 is the 94th year that Americans have had to file an income tax. For most Americans, the day is a non-event. The federal and state governments have already collected the taxes due by withholding from each paycheck over the course of the calendar year. Most Americans never saw the money and have no real idea that they earned it.
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news.goldseek.com >> 10 April 2009 |
Bailout Bonds?
By: Llewellyn H. Rockwell, Jr.
If private markets have learned from past mistakes, they will stay away from these bonds. They will freely tell others not to buy them either. But then what happens, especially as the depression deepens? In the First World War, such people were sent to jail. That tended to have a chilling effect on open discussion of the subject.
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news.goldseek.com >> 9 April 2009 |
The Real Estate Bust Is Far From Over
By: Doug French
For those thinking that the real estate bust is all over with – think again. The residential market has hit the ditch and continues to sink lower, but now the commercial property market is rolling over and will take many lenders down the drain with it.
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news.goldseek.com >> 8 April 2009 |
Panic: First Wall Street, Then Main Street
By: Gary North
We have not yet seen panic on Main Street. The malls' parking lots are full. Most yuppie restaurant chains are still in business. Their local restaurants may not be as full as they were a year ago, but they are open for business. There are still shoppers at Wal-Mart.
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news.goldseek.com >> 7 April 2009 |
Blowing Bubbles
By: Doug French
While history clearly shows that it is this very government meddling in monetary affairs that leads to financial market booms and the inevitable busts that follow, mainstream economists either deny that financial bubbles can occur or that the "animal spirits" of market participants are to blame.
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news.goldseek.com >> 6 April 2009 |
Insolvency vs. Liquidity, or Austrians vs. Keynesians
By: Michael S. Rozeff
An economics debate of very great importance is surfacing. Is the government’s economic rationale for bailing out the banks valid? If it is not, then the entire case for the bank bailouts fails.
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news.goldseek.com >> 5 April 2009 |
There Will Be (Hyper)Inflation
By: Thorsten Polleit
The solution to a destruction of the currency is the return to sound money – free-market money – as outlined by Mises and further developed by Murray N. Rothbard. It would presumably, at least in the initial stage, result in gold-backed money under 100% reserves. The edging up of the gold price seems to support the view that people consider gold as the ultimate means of payment – a status that will become increasingly obvious once people fear that the exchange value of fiat money will be eroded substantially.
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news.goldseek.com >> 3 April 2009 |
The Trouble With Warren Buffett
By: Doug French
When a junior high investment club wrote in to CNBC’s Squawk Box to ask legendary investor Warren Buffett what he thought the price of gold would be in five years and whether the yellow metal should be a part of value investing, the Oracle of Omaha responded with:
Bailout Baloney
By: Dom Armentano
As even Karl Marx once reluctantly admitted, the capitalist system has created more wealth (and more quickly) than any other economic system in history. Yet, despite its obvious success (or, perhaps, because of it), the system is poorly understood and almost never loved. And this ignorance and lack of affection (for self-interest and profit and competition) always makes capitalism vulnerable (especially during recessions) to crack-pot schemes and reforms that strike at the root of its economic performance.
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news.goldseek.com >> 2 April 2009 |
Would Cleansing Banks' Balance Sheets Kick-start the US Economy?
By: Frank Shostak
It is believed that banks fund economic activity by means of credit expansion. Toxic assets, however, cause banks to curtail the expansion of credit and thereby plunge the economy into a severe economic slump. So it is not surprising that for most experts and President Obama the success of the Treasury plan (i.e., the removal of toxic assets from banks' balance sheets) is a key for economic recovery.
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news.goldseek.com >> 1 April 2009 |
Nightmare on Wall Street
By: Lila Rajiva
The furor over the AIG rescue and the possibility that American banks might be nationalized have turned March into a financial horror film: Zombies on the street, empty vaults, tentacled monsters, and cryptic pronouncements from a parallel universe. It deserves rewinding and deconstruction, episode by episode.
Destination Collapse
By: Michael S. Rozeff
The massive government and FED stimulation that we are now being subjected to cannot and will not produce a sound and sane economy. The greater the stimulus, the more the free market prevented from working and restoring the economy to normalcy.
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news.goldseek.com >> 29 March 2009 |
George Soros on Main Street and Wall Street
By: Gary North, Mises on Money
Donald Trump is smart. His bondholders are smart. Central bankers are smart. But they are not smarter that the assembled knowledge of a free market that is not being distorted by bureaucratic monetary policy.
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news.goldseek.com >> 25 March 2009 |
Save the Big Banks, Trash the Dollar
By: Gary North, Mises on Money
Timothy Geithner's plan to save the big banks will be a success. This success will come at a cost. The plan will hurt taxpayers, and it will lead to severe price inflation. It will not revive the faltering economy in 2009. It will not restore the housing market. Family wealth will continue to decline.
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news.goldseek.com >> 23 March 2009 |
Global Money Inflation in the Late-Departed Boom
By: Michael S. Rozeff
The world economy is experiencing a severe recession or depression. This has been preceded by a steep inflation in nominal stocks of money across the entire world. Central banks control these money stocks or money supplies. They engineered a global credit boom by inflating their local currencies.
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news.goldseek.com >> 20 March 2009 |
The Unholy Marriage of 'Fiscal' and 'Monetary' Policies
By: William L. Anderson
Although economists are cheering this latest development, the Austrians know better. There is no way the economy can absorb this amount of new money without severe malinvestments and dislocation of the economic fundamentals, and that simply sets the stage for later and more virulent crises.
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news.goldseek.com >> 18 March 2009 |
Obama's War on Recovery
By: Llewellyn H. Rockwell, Jr.
Obama came to power with the idea of repeating the storybook-view of FDR's presidency and how he saved us from the Great Depression. Had he and his friends read the history more carefully, he would have seen how FDR did nothing of the sort. His policies waged war on recovery, perpetuating the problem he said he was solving.
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news.goldseek.com >> 15 March 2009 |
Master Madoff
By: Don Cooper
We my friends have been fortunate enough to live in a wondrous time. A time of invention, innovation and technological advancements that has inspired an evolution of the human species never before seen. And we have been chosen to live in the time of one of the greatest masters of them all. A teacher among teachers. A Jedi knight of the first order.
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news.goldseek.com >> 12 March 2009 |
We Need Our Heads Examined, Says Harvard
By: Thomas E. Woods, Jr.
Last weekend, Harvard University sponsored a conference called (I am not making this up) "The Free Market Mindset: History, Psychology, and Consequences." Its purpose was to try to figure out why, since everyone knows the current crisis amounts to a failure of the market economy, the stupid rubes continue to believe in it.
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news.goldseek.com >> 9 March 2009 |
Systemic Risk Reduction via Failure
By: Michael S. Rozeff
One year ago, Bear Stearns faced collapse when its short-term lenders stopped rolling over their loans to the investment bank. The federal government and the FED stepped in. They financed and brought about an acquisition by the JP Morgan Chase (JPM) bank.
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news.goldseek.com >> 8 March 2009 |
Dialogue #4 on the American Gold Standard: Trust and Distrust in Banking
By: Gary North, Mises on Money
The private money guy and the state money guy go at it again.
PMG: If a gold standard is really a standard, who sets it?
SMG: The government.
PMG: Why not the free market?
SMG: Because someone has to enforce the law.
PMG: What law?...
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news.goldseek.com >> 6 March 2009 |
The House That Regulation Built
By: Michael S. Rozeff
Ground zero of the economic depression is the banking system – worldwide. The system is collapsed, exploded, demolished, gone, ruined, kaput. The global banking system was a house of cards, and it has fallen. Governments and central banks everywhere do not yet realize this. They are attempting to rebuild the house from the pieces and scraps scattered far and wide. Better to salvage the pieces that still work and use them in an entirely new system than attempt to rebuild this one on the same cracked foundation and along the same flawed lines that produced this wreck.
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news.goldseek.com >> 5 March 2009 |
Where Did the Jobs Go?
By: Bill Trench
The solution to the current recession is to scrap the whole “bailout” bill, and cut government spending drastically. At the same time cut taxes across the board, thus making money available for people and companies to spend and invest, thus creating more demand, thus creating more production, and thus creating more, newer and better jobs which will, in the end, mean greater wealth for everyone. Will it happen? I for one am not holding my breath.
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news.goldseek.com >> 4 March 2009 |
The Root of All Evil
By: Paul Hein
So look about once again. What you see is the collapse of a society built upon a bubble of deceit and dishonesty, a society which has been trying to borrow itself into prosperity. It’s happened before, many times. A fiat "money" eventually reaches its intrinsic value. Do we learn from experience? In monetary matters, the answer would seem to be "NO!" And civilization crumbles, on a foundation of fiat. A sound society needs sound money.
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news.goldseek.com >> 2 March 2009 |
Dialogue #3 on the American Gold Standard: Science Is as Science Does
By: Gary North, Mises on Money
The gold standard has advocates, but the problem is, there are competing versions. The government-enforced gold standard is the one that gets all the space in the history textbooks. This is because it is the only version governments allow.
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news.goldseek.com >> 1 March 2009 |
The FED’s Unsound Theories
By: Michael S. Rozeff
There are many slips betwixt cup and lip, and thus this introduction before getting to the FED’s unsound theories. Neither the federal government nor its Constitution have a moral or rightful foundation over any person residing in America who does not consent to them, for civil and political rights include the right of association.
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news.goldseek.com >> 22 February 2009 |
Dialogue #2 on the American Gold Standard
By: Gary North, Mises on Money
PMG: You still believe in gold.
SMG: Yes, I do. I own gold coins.
PMG: Is that because you don't trust the Federal Reserve System?
SMG: Yes.
PMG: Why don't you trust the FED?
SMG: Because the country isn't on a government-enforced gold standard.
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news.goldseek.com >> 20 February 2009 |
Where the Future Went
By: Joe Schembrie
Almost forty years ago, the United States had seemingly reached the zenith of economic power. Then on August 15, 1971, the federal government abandoned the gold standard, and the last tether between Federal Reserve policy and fiscal responsibility was severed. For America, it was when the future went away.
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news.goldseek.com >> 19 February 2009 |
Debt and the Price of Gold
By: Michael S. Rozeff
Gold is a speculative market. Price can go "too low" or "too high" compared with whatever theoretical notions we may have about what prices should be. If gold rises too fast compared to the rise of debt/GDP, then it may be overpriced. If it rises too slowly compared to debt/GDP’s rise, it may be underpriced.
The Looming Collapse of European Banking
By: Gary North, Mises on Money
The West's economy really is at the edge of a leveraged disaster. The politicians know only one answer: deficit spending. The central bankers have only on significant tool: monetary inflation. The speed of events is increasing. The markets don't reflect this yet. This gives time to a few people to get out. But the vast majority cannot get out. There are too few escape hatches open.
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news.goldseek.com >> 18 February 2009 |
On the Price of Gold
By: Michael S. Rozeff
Notes of caution are appearing in market letters written by gold enthusiasts. They remain long-term bullish, but some fear that a temporary sharp setback is at hand. Others advise against buying until prices fall back somewhat. Others mention gold’s volatility. Some note that commercial hedgers have increased their selling. There is rather widespread fear that gold will have a difficult time making much more headway soon. However, the more that I have studied the gold market, the more I have become long-term bullish.
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news.goldseek.com >> 16 February 2009 |
Dialogue #1 On the American Gold Standard
By: Gary North, Mises on Money
In reading any dialogue, you know in advance that the guy asking the questions is the guy who wrote the dialogue. He will win the argument. This tradition goes back to Plato, where the losers were sometimes reduced to some variation of "Tell us more." This dialogue is between two vocal advocates of limited civil government: Private Money Guy (PMG) and State Money Guy (SMG).
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news.goldseek.com >> 11 February 2009 |
The Stimulus of Abominations
By: Michael S. Rozeff
The federal government is about to pass a law that authorizes $800 billion or so of new expenditures. The Secretary of the Treasury will be introducing other new measures today. More such will be forthcoming. In addition, the Fed’s monetary policy will support this spending.
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news.goldseek.com >> 8 February 2009 |
Economic Fascism and the Bailout Economy
By: Gary North, Mises on Money
What I am saying is this: this time it's different. This time, the fractional reserve banking system has shot its wad. It is begging for ever-larger handouts from the Treasury Department, which needs central bank fiat money to bail out the economy. The public is accepting this grudgingly, and the academic economists are cheering, but the reality is this: this time it's different. You had better adjust your portfolio, your career plans, and your retirement plans accordingly.
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news.goldseek.com >> 4 February 2009 |
The Federal Reserve's Self-Imposed Dilemma
By: Gary North, Mises on Money
The only thing that is keeping this from creating mass inflation is the decision of commercial bankers to deposit the bulk of this increase with the Federal Reserve. The banks are not lending out this money. Neither is the FED. This money does not legally belong to the FED.
Big Deficits and a Weaker Dollar
By: Michael S. Rozeff
Hyperinflation in the U.S. hasn’t happened for quite some time. The last two instances that come to mind are confederate money in the 1860s and the continentals in the 1770s. In both these cases, governments used inflation to finance wars because their tax systems were weak.
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news.goldseek.com >> 2 February 2009 |
Forced Lending To Undermine the Economy
By: Michael S. Rozeff
The Obama administration promises us a program of forced lending by banks. By this means, they intend to promote economic recovery. Amazing as it seems, our major officials do not understand that forced lending by banks severely undermines an economy. Subsidizing loans will destroy the market for bank credit. Bank credit will no longer be allocated by rational means of comparing real costs to real benefits. The results will be to harm many people and worsen the structure of the U.S. economy.
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news.goldseek.com >> 1 February 2009 |
If Deflation Is Coming, Sell Your Gold
By: Gary North, Mises on Money
The debate over inflation versus deflation has been going on in hard money circles since about 1973. The debate has gone on within academic circles for well over a century. The economists are as confused as the general public, but they are confused in a far more sophisticated way. They turn confusion into a science.
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news.goldseek.com >> 28 January 2009 |
Ben Bernanke's Wild Ride (and Ours)
By: Gary North, Mises on Money
I am all for muddling through. But, at this point, I don't see Conventional Creek on my copy of the map. The monetary base has been doubled. The only thing keeping banks from lending to the limit of their legal reserves is fear. If bankers are so afraid to lend, despite returns of one-tenth of 1%, we are not heading toward Conventional Creek. We are headed for the falls. Inflation Falls. Dollar falls. Gold rises.
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news.goldseek.com >> 27 January 2009 |
Money and Our Future
By: Llewellyn H. Rockwell, Jr.
We are fortunate to be living in these times, for we are seeing the unfolding of events long explained and predicted by the Austrian tradition. Maybe that sounds implausible. What is fortunate about our times? The economy is tanking, stocks have been pummeled, unemployment is rising, and Washington is pursuing the worst combination of economic policies since Hoover and FDR. Nor does the new guy in charge seem to have a clue about the limits of what government can do.
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news.goldseek.com >> 26 January 2009 |
Tour the Worldwide Economic Crash for 39 Seconds
By: Gary North, Mises on Money
So, you want to know how bad this crash will get. Fine. Spend 30 seconds to see the magnitude of what it is today. It's going to get much worse. The Manchester Guardian published 13 photos from around the world that show the extent of the disaster. Spend just 3 seconds per photo. (You won't see these on Tout TV.)
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news.goldseek.com >> 23 January 2009 |
Bring Back Capital!
By: Jeff Snyder
The moral of the story? If we get rid of the Reserve, we get rid of an institution with the power to undercut all investors and to provide cheap credit divorced from economic reality, and if we also get rid of the tax bias in favor of debt financing, then companies will have a more rational balance of capital and debt, investors may again be able to make money on their money, and companies will have a greater ability to hang on to workers, who they will need when business picks up again.
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news.goldseek.com >> 15 January 2009 |
Has a Stimulus Ever Been Necessary?
By: Scott M. Rosen
The fallacy behind the call for economic stimulus is that declining aggregate demand is the mother and not the daughter of economic contraction. When left to its own devices, the market will return back to prosperity (consumer demand and all). Government intervention oftentimes has the effect of actually prolonging the crisis. The new administration would be wise to let the market adjust on its own and spare us the additional debt and debased currency that an active fiscal and monetary policy will yield.
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news.goldseek.com >> 14 January 2009 |
Blood in the Streets? Nope. Red Ink.
By: Gary North, Mises on Money
The phrase, "blood in the streets," refers to economic panic. Wise investors say they will buy stocks when there is blood in the streets. This means panic. It refers to a final sell-off, when fear trumps greed. We are nowhere near that stage today.
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news.goldseek.com >> 11 January 2009 |
The Sunset of Federal Government Guarantees
By: Michael S. Rozeff
Our federal officials have passed laws that guarantee an incredible variety of debt and debt-like obligations. The amounts run to 50–100 trillion dollars or so. If events occur such that they have to pay off a cluster of these guarantees, they cannot do so. They can pay off in paper but they can’t pay off in terms of real assets.
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news.goldseek.com >> 31 December 2008 |
Closet Keynesians Emerge
By: Gary North, Mises on Money
One of the best tests for determining whether a financial columnist or a professional economist is a Keynesian is to examine his views on personal spending. If he favors an increase of personal spending as a means to stimulate the economy, he is a Keynesian. He may not call himself a Keynesian, but he is a Keynesian.
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news.goldseek.com >> 30 December 2008 |
Who Controls the Money?
By: Michael S. Rozeff
In their attempts to halt credit deflation, the government and the Fed are unleashing a torrent of corruption, inefficiency, misuse of funds, and fraud. If a bank is too big to fail and the government and/or the Fed make sure that it survives, despite the past mis-behaviors of its officers, then they invite those officers to misuse the funds that they infuse.
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news.goldseek.com >> 26 December 2008 |
Rating the Rating Agencies and Securitization
By: Michael S. Rozeff
The risks and drawbacks of securitization were ignored in the flush of a success that was supported by government and government-sponsored enterprises. Securitization is all but dead, but it’s on extremely expensive life support being paid for by forced exactions from taxpayers.
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news.goldseek.com >> 24 December 2008 |
When Trust Runs Out
By: Gary North, Mises on Money
Every society and every institution rests heavily on trust. There is active trust, the result of "trust, but verify." I call this stage one trust. Then there is stage two trust, which I call default trust: "Trust, and assume that someone else has verified." Next, there is stage three trust, which I call blind trust: "Trust, because there is nothing else worth trusting." Then there stage four trust, which I call tooth fairy trust: "Trust, despite all evidence to the contrary." This form of trust is the foundation of all Ponzi schemes.
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news.goldseek.com >> 23 December 2008 |
Banking Demystified
By: Doug French
All of this regulating won’t make for sound banking. That’s impossible with fiat money, fractional reserves and central banking as Rothbard explains. To put banking back on sound footing, the dollar must be defined by weight in gold, the Fed must be liquidated, banks must have gold equal to 100 percent of demand deposits, the U.S. Mint should be abolished, and the FDIC, instead of bulking up, should be abolished, "so that no government guarantee can stand behind bank inflation, or prevent the healthy gale of bank runs assuring that banks remain sound and noninflationary."
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news.goldseek.com >> 22 December 2008 |
Madoff Explained
By: Llewellyn H. Rockwell, Jr
Most of us like to believe that we wouldn't have been tricked by Madoff. But are you being tricked by the elites who claim that they can conjure up a trillion dollars to stabilize our economy by clicking a few buttons on a computer screen? Most people are. Certainly the press seems to have bought it. Many people were outwitted by Madoff. Many more people are today being outwitted by the government and its central bank. And it will all end in disgrace and disaster, only on a far, far grander scale.
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news.goldseek.com >> 19 December 2008 |
As 2008 Fades Away
By: Michael S. Rozeff
As 2009 approaches and 2008 fades away, I have a few thoughts about our economy. Perhaps you can factor them into your forecasts of what lies ahead.