On December 31st, 1930, White Motors’ balance sheet reported cash of $8.5 million, receivables and merchandise of $15 million and net fixed assets of $14 million. Less liabilities of $1.3 million, the company had a net worth position of $36.2 million. The company’s stock price was trading between $7 and $8 per share. At the 12/31 close, the stock
[This article ran in the The Asian Wall Street Journal, January 28, 2000. Copyright (c) 2000, Dow Jones & Company, Inc.] The performance of the Malaysian stock market this past year would appear to have vindicated Prime Minister Mahathir Mohamad’s economic policies -- including his controversial decision to impose limited capital controls in
The recent softening in some economic indicators prompted market players to conclude that the Fed is unlikely to pursue its tighter interest rate stance further. The reason for this view is that slower economic activity will cool off consumer demand and, consequently, the rate of inflation as measured by various price indices will follow suit.
According to the efficient markets hypothesis, stock market prices move in response to new, unexpected information. Since, by definition the unexpected cannot be known, it implies that an individual’s chances of anticipating the general direction of the market are as good as anyone else’s chances. It is thus suggested that since the future
The Free Market 18, no. 9 (September 2000) Dictatorships always immediately ban short selling,” wrote Fred Schwed, Jr., in his fun 1940 book on investing, “since it is axiomatic with them that no professional pessimists are going to be tolerated.” Indeed, the long-vilified bearish practice called short selling involves a sale of borrowed stock
Many economists take it for granted that the attempts of the authorities to expand credit will always bring about the same almost regular alternation between periods of booming trade and of subsequent depression. They assume that the effects of credit expansion will in the future not differ from those that have been observed since the end of the
With so many Americans invested to the hilt, falling stocks can inflict serious financial pain. But far more damaging to long-term economic prospects will be the largest avalanche of economic nonsense to tumble out since the 1987 crash. Hordes of crackpot financial thinkers are already calling for draconian government measures to stop the
With Dick Cheney’s recent mention of the “R Word,” the unthinkable is being openly discussed: Are we headed for a recession? Politicians in the last few years have been assuring Americans that the “New Economy” has made the dreaded business cycle passé, but don’t tell that to the dozens of venture capitalists and “dot com” folks who seem to have
The Dow Jones Average and other market indicators tend to fall these days on each new report of increased prosperity. Or so it seems. The unemployment rate drops another tenth of a percent; stock prices take a nose dive. The most recent GDP figures suggest higher-than-expected economic growth; bond holders take a beating. How do high employment
What is the Mises Institute?
The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard.
Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.