Booms and Busts

Mark Thornton argues Washington’s political theater cannot paper over the mounting costs of war, sanctions, debt, and inflation.

Because of Keynesian inflationary bias, economists, politicians, and journalists celebrated the huge financial moves that Ben Bernanke made in 2008 and beyond to deal with the financial meltdown and its aftermath. But Bernanke’s moves didn’t help the economy; they made things worse.

Federal Reserve policy has been to expand credit out of nothing without regard for the real damage it does to the economy.

The familiar story pits western farmer-debtors against eastern merchant-creditors. Rothbard's evidence says the story is wrong.

Years before the English currency school made it famous, Americans were arguing for one hundred percent reserves, and some wanted banking abolished outright.

They borrowed when prices were high and had to repay when prices were low. Should the legislature rescue them, or would rescue only deepen the ruin?

A wartime boom, a flood of bank paper, a speculative rush for western land, and then the reckoning.

America's first great depression arrived without a villain: no embargo, no war, no single blundering minister to blame. It seemed to rise out of the economy itself.

Federal Reserve policy has been to expand credit out of nothing without regard for the real damage it does to the economy.

Keynesian theory says that the way to end a recession in which the economy is in a “liquidity trap” is for government to ramp up spending. Murray Rothbard demonstrated that this policy actually blocks an economic recovery.