As the history of America's Great Depression is one long regret of political follies and blunders that aggravated the suffering, so is the story of the Japanese recession from the 1990s to the present. The Japanese government tried to spend its way out of the recession, but instead merely prolonged it and created a mountain of debt.
During the early 1800s, the U.S. paper money in circulation was issued by banks, most of which were privately owned and state-chartered. There were, in fact, hundreds of banks across the country that issued their own--often distinctive--paper money. From these banking practices arose the infamous $3 bill.
September 11 was far from the first time that the United States has been targeted by terrorists. In a 1997 report on the scourge of terrorism, the Pentagon's Defense Science Board observed: "Historical data show a strong correlation between U.S. involvement in international situations and an increase in terrorist attacks against the United States." Recognizing that fact is crucial to understanding why both terror and the response to terror have become such grave threats to freedom and prosperity.
Americans are discussing whether the president can just take on the powers of a Caesar, claiming more and more power because of the demands of war. But for those advocates of an imperial presidency, there are the words of Justice Davis: "No doctrine, involving more pernicious consequences was ever invented by the wit of man than that its provisions can be suspended during any of the great exigencies of government."
Freedom needs no help from the state—which is its natural enemy, not its ally. Freedom promotes natural order, inequality, and the decentralization of enterprise, wealth, and culture.
Professional victimologists see bad investors as victims of biased research. But they ignore the fact that smart investors have plenty of chances to avoid bad advice. What the losers from the Enron collapse got taken in by was the Fed-induced Bubble, not someone else's bad research. Those who would impose additional bureaucratic restrictions on Wall Street only penalize everyone to protect the gullible.
Far from an example of a market failure, Enron's saga shows that firms that invest too much in politics can easily become complacent in the face of changing market conditions. In economics, this is called government failure, and we can blame the growing requirement for firms to divert resources to grease palms in Washington as a necessary business investment for its occurrence.
According to the popular view, the revival of some important economic indicators has raised the likelihood that the aggressive lowering of interest rates by the Fed will invigorate the economy. The irony is that the very same loose monetary policies that are expected to energize the economy in fact undermine its main source of strength.
The launch of the European economic and currency union is changing the political and economic landscape of Europe and may affect other parts of the financial world. In time, it may even modify the world dollar standard and give rise to a bicentric dollar-euro standard, which is the hope and dream of most Europeans.
The custom of tipping is an excellent demonstration of the market's ability to solve real-world problems of dispersed knowledge and transactions costs in order to ensure the maximum satisfaction of consumer preferences. Normally taken for granted, tipping is in fact a beautiful illustration of the power of voluntary, decentralized exchange.
