As the 2016 election draws near, the elephant in the room — whether the candidates and the public know it or not — remains the central bank and its continued power over both the domestic and global economy. There is good reason to believe, of course, that the Fed is actively crafting policy to avoid any economic crises before the election, in order to benefit the Clinton campaign. But, the evidence continues to mount that the Fed simply won’t succeed in its efforts to forever steer the economy with a team of technocratic elites. The Fed, for example, doesn’t understand how interest rates are truly formed in the marketplace, nor can it square the real long-term effects of inflation with its irrational fear of deflation. Worst of all, as central bankers continue with their public-relations tours, they drape themselves in the mantle of freedom and free markets.
In spite of their best efforts to hide their failures and their plans from the public, though, the voters are clearly restless this year, which is why the New York Times and others have unleashed attacks against democracy and populism in recent weeks. How long the interventionist governments and their allies can hold back the tide remains to be seen.
We have two events remaining for 2016, one before the election and one after; however the chads fall. Register now and join us:
- The End of Politics — November 5, Fort Worth-Dallas with Bob Murphy, Lew Rockwell, Jeff Deist, and special guest Roger Stone.
- Election Postmorten — December 1, Orlando with Tom Woods and Jeff Deist. (Space is limited for this event.)
Even well-read fans of Austrian economics often have a hard time understanding and conceptualizing what the Fed really does. So for this episode of Mises Weekends we asked our good friend Dr. Jeffrey Herbener to join us and make sense of it all. We cover the basic blocking and tackling of central bank mechanics: how commercial bank reserves are created, the difference between the monetary base and the money supply, and how the Fed Funds rate impacts lending and the structure of production. We consider how Austrian business cycle theory describes the distortions created by artificially low interest rates, and how interest rates ought to operate as price signals. Finally, we discuss how early recipients of newly created money and credit benefit in ways that ordinary citizens don’t.
This show is a great primer on the Fed from an Austrian perspective.
In case you missed them, here are this week’s articles of interest from the Mises Wire:
- Ignorance Is More Costly in Politics than in Markets by Gary Galles
- Why They Keep Trade Deals Secret by Claudio Grass
- Mark Carney: Britain’s Celebrity Central Banker by George Pickering
- The September-October Issue of The Austrian Is Now Online
- Iceland Today, the US Tomorrow? by Ron Paul
- Faced with Angry Voters, the Elites Sour on Democracy by Ryan McMaken
- Skyscraper Alert in China? by Mark Thornton
- Audio: Jeff Deist on Central Banks on the BBC
- The Fed Thinks It Can Use the “Natural” Interest Rate to Fine-Tune the Economy by Frank Shostak
- The Special Interests Behind Marijuana Prohibition by Mark Thornton
- Video: Joseph Salerno Explains the Benefits of Deflation
- How the Feds Botched the Frontier Homestead Acts by Ryan McMaken
- How Regulation Protects Established Firms by Peter G. Klein
- Why This “Boom” Doesn’t Feel Like One by Brendan Brown
- The Federal Reserve Is Hillary Clinton’s Secret Weapon by Tommy Behnke
- The Presidential Elections: Baltar vs. Roslin by Matthew McCaffrey
- Ballots and Bullets by Murray Rothbard
- Inflation May Be Causing a Long-Term Rise in Unemployment by Karl-Friedrich Israel
- What’s the Difference Between Liberalism and “Neoliberalism?” by Ryan McMaken
