There are few things that reduce the price of a good like an increase in its supply. But the very people who decry the lack of "affordable" housing in New York and other places are often the ones who are most agitated about "overdevelopment." While the idea of "a lack of affordable housing" is itself suspicious, it is clear that one effect of many government programs is to make housing less affordable than it otherwise might be.
The tax bills of many American families are falling during a period of exorbitant increases in federal spending due mainly to war and welfare spending. Odd? Not once we discover the record levels of government debt accumulation. It's the shell game of government finance at work.
How well I recall the debates about the WTO and Nafta, both of which the Mises Institute editorialized against on grounds that they constituted managed trade, not free trade. In the case of Nafta, it was outright regional protectionism. But for dissenting from both sides of the phony DC debate, we were called secret protectionists.
It happens in every bear market and in every crash. Investors get it wrong. Then regulators get it wrong. They look for scapegoats and find the wrong ones.
Central banks are a recent development in the history of civilization—the culmination of years of consolidation—but the tendency of governments to inflate the currency is not.
To most, the strong housing market has "saved" the economy by providing consumers with fresh purchasing power and housing gains have helped cushion many from the withering blows of the stock market’s decline.
But the housing boom is not an unmitigated good.
If you stuck a dollar in a savings jar in 1913 and tried to spend it today, you would find your purchasing power had been sapped. Your dollar would be worth about a nickel. What happened? Well, the government had created an institution called a central bank that was endowed with the power to create money. And create it did: so much so that it diminished the value of all existing currency.
It has finally come down to this: Martha Stewart must go to prison, or at the very least be forced to step down from her position as CEO of Martha Stewart Living Omnimedia.
With more money in their pockets, the president believes Americans will be able to spend more and this will speed up economic recovery. According to President Bush, "By ensuring that Americans have more to spend, to save and to invest, this legislation is adding fuel to an economic recovery. We have taken aggressive action to strengthen the foundation of our economy so that every American who wants to work will be able to find a job."
While one hopes that this current sorry situation does not metastasize into a full-blown calamity reminiscent of the Great Depression, there are some not-so-obvious but important issues that need to be raised if we are to climb out of this economic mess.
