Money and Banking

The stability of the Eurozone is back in the spotlight this week amidst Greece’s talks with its creditors—which seem to be going nowhere good. 

The euro is an inflationary fiat currency, but it’s apparently not inflationary enough for many profligate European governments that want their own local currencies so they can inflate even more, and use easy money to temporarily cover up many economic sins.

Both Republicans and Democrats think they can tinker their way to creating an economy with less inequality. Both sides miss the point, and ignore the central role of government fiat money in the problem.

The world's central banks have been pouring new money into the financial system, which has produced a dangerous amount of distortion to prices in the market. And what do we have to show for it? Economic growth is anemic, at best.

It appears that even economists are now being replaced by machines. At least it seems that way given a recent paint-by-numbers attack from the New York Times on James Grant's new book The Forgotten Depression.

Japan finally joined the US and the EU in their grand 2-percent-inflation-forever experiment in 2005. Many Japanese politicians have benefited from this. Meanwhile, nothing has been done in Japan to actually help the economy defend itself against the next economic disaster.

I’d like to think Mises would have spared a few minutes of his precious time “exploding the fallacy”—an often used expression in his writings—of Bernanke’s most recent musings.

Governments worldwide are turning to "financial repression" to manipulate the economy through easy money and aggressive regulation. In the end, we'll find it will amount to little more than slapping a band-aid on a serious problem.

It is hardly a relief for British households that £100 worth of consumer goods will now cost them around £99.90, when other prices in the UK economy are experiencing a rapid inflation. 

With huge debts and an immensely inflated supply of dollars, the US is vulnerable to its own "Suez moment" in which foreign regimes can nullify American foreign policy without firing a shot.