A contributing problem of the 1990s economic boom was ideological, and it is one that still persists in the aftermath, writes Christopher Mayer. It was a cultural error that made a hero out of a Fed Chairman and that put so much faith in the Fed to begin with, at the expense of sound economics.
How are fiat money and the business cycle related? Without sound money, calculation is less efficient and the economy will be prone to business cycles. With sound money policy, no boom-bust cycle will emerge and monetary calculation and planning will be as efficient as possible in an uncertain world. John Cochran explains.
Ah, the simplicity of demagogic populism, especially that of Bill O'Reilly and Stephen Moore. They haven't even bothered to notice that Dannon yogurt produces products in three U.S. plants (in Ohio, Texas, and Utah) and distributes them from five U.S. facilities (in Texas, California, Ohio, Florida, and Pennsylvania).
The looming war with Iraq raises concern among US economists that this could trigger a recession. The possible war, it is said, generates uncertainty, which in turn paralyses business and consumer expenditure. Frank Shostak puts the theory of the "exogenous shock" into perspective; there is a basis for recession with or without war.
Artists often see themselves as underappreciated members of an elite that knows which cultural achievements are economically valuable and which are not. In actuality, profit drives businessmen to attempt a vastly more complex task: the estimation of actual consumer wants in a vastly complex and changing world.
Stagflation is a term that originated in the early 1970s to identify the simultaneous occurrence of recession and inflation—a phenomenon that Keynesian theory had previously suggested was impossible. The industrialized world is being rudely reminded that stagflation is indeed possible, and policymakers are at a loss as to what to do about it.
In deciding whether to wage war against yet another regime that has fallen into disfavor with DC, the United States must make some hard choices. Gregory Bresiger asks: will we follow the traditions of George Washington or those of Woodrow Wilson? "War," wrote Mises, "is harmful not only to the conquered but to the conqueror."
If hedge funds can be regulated or inhibited from selling short, asks Christopher Mayer, what is next? Ban mutual funds that invest in tobacco companies or other sin stocks? Ban investors from betting against a rise in the dollar? Prohibit investors from owning gold? (That's already been done before.)
It is natural that liberty and peace go together, writes Lew Rockwell. Liberty makes it possible for people from different religious traditions and cultural backgrounds to find common ground. Commerce is the great mechanism that permits cooperation amidst radical diversity. It is also the basis for the working out of the brotherhood of man. Trade is the key to peace. It allows us to think and act both locally and globally.
