Capital and Interest Theory / Frank Shostak

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The Fed's Fantasy on Neutral Interest Rates

The FedCapital and Interest Theory

The Fed is trying to establish a level of interest rate that corresponds to the conditions of the free market. Unfortunately, this is impossible.

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"Priming the Pump" Won't Create Real Wealth

Capital and Interest Theory

Many economists believe the economy can be "jump-started" with some monetary and fiscal stimulus. Unfortunately, this only creates bubbles.

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How the Fed Operates — And Why It's a Problem

The FedMoney and BanksCapital and Interest TheoryMoney and Banking

Central bankers often claim their tinkering with the money supply is but a small intervention, but in reality, it sets the boom-bust cycle in motion.

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Technology Needs Capital To Produce Economic Growth

Capital and Interest TheoryEntrepreneurship

06/08/2015Mises Daily Articles
Krugman is confused as to why so much technological growth in recent years has not led to more economic growth. The answer lies in the fact that true technological change requires funding — and thus real savings — to be implemented.

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Employment Does Not Drive Economic Growth

Capital and Interest TheoryValue and Exchange

02/19/2015Mises Daily Articles
The Fed — and many economists everywhere — believe that giving more people jobs will drive more economic growth. But more employment is useless for economic growth if employed persons are not contributing to real wealth and capital accumulation.

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Is the Surge in Capital Goods Orders Due to Malinvestment?

U.S. EconomyCapital and Interest TheoryProduction Theory

10/15/2014Mises Daily Articles
Orders in capital goods have been going up since 2009. Normally, capital goods purchases suggest economic growth, but if the orders are a result of easy money, the purchases point not to wealth creation, but to a bubble.

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Does a Liquidity Trap Pose a Threat?

BiographiesThe FedCapital and Interest TheoryOther Schools of Thought

09/23/2009Mises Daily Articles
Contrary to popular thinking, the threat posed to the major economies is not the liquidity trap, but the government and central bank stimulus policies aimed at countering it.

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Would Cleansing Banks' Balance Sheets Kick-start the US Economy?

Financial MarketsBusiness CyclesCapital and Interest TheoryMoney and Banking

04/01/2009Mises Daily Articles
Since the heart of credit is real savings, it is obvious that no government schemes, such as cleansing banks' balance sheets, can increase fully backed credit.

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Printing Like Mad

The FedFinancial MarketsCapital and Interest TheoryFiscal Theory

02/16/2009Mises Daily Articles
What permits real economic growth is an improvement in the investment infrastructure of the production process. What makes the improvement possible is real savings.

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Inflation, Deflation, and the Future

Money and BanksCapital and Interest TheoryMoney and Banking

Recorded at the Toronto Stock Exchange; September 16-17, 1999. [30:49]

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