Money and Banking

The dollar's last tie to gold was severed 45 years ago. Gold had always been an inconvenience for governments looking for more debt and spending.

Starting today, the Royal Bank of Scotland will become the first bank in the U.K. to impose a negative interest rate on depositors.

With central banks falling into step in a seemingly inexorable race toward negative interest rates, this could point to bigger problems on the horizon.

It is a time of fiscal hedonism, engineered and encouraged by governments and their central banks, and sold to us as banal public policy and tinkering.

When new money is made, it helps those who get the new money first (usually the wealthy) — at the expense of those who get it later (the poor).

Government is not a wealth-creating entity, and more stimulus will not help the economy. In fact, more stimulus will hurt the wealth creation process.

A fall in the US velocity of money M2 to 1.44 in June from 1.51 in June last year and 2.2 in May 1997 has alarmed many experts.

45 years ago today, on August 15, 1971, President Richard Nixon officially closed the gold window.

In today's slow growth economy, business decision makers are understandably cautious because historically monetary tightening has been a fatal blow.

The major threat to any economy is not deflation, but the policies used to count it.