On July 8 this year, UK prime minister Boris Johnson resigned as Conservative Party leader after a Cabinet revolt over a series of ethics scandals had made his position untenable. A leadership election was then set in motion to allow party members to elect the next party leader who would succeed Johnson as PM.

The front door opens in a rush of air, followed by the muffled patter of shoe-less feet racing across the threshold and up the stairs. A mother seated at the kitchen table calls out, “Are you all done outside?” A chorus of yeses returns from the second floor. The mother smiles and returns to her work.

Price inflation and the resulting business cycles are monetary phenomena, and without increases in the money supply—i.e., monetary inflation—there is no price inflation. If the world were a very simple place, we would see this relationship clearly displayed: when the money supply increased, we would also see a general increase in prices soon thereafter.

Seven months ago I published the article: Will You Buy the Dip? I concluded:

Whether it’s this year, the next, or some time beyond, there will be an event, such as the return of COVID, WW3, the next Lehman Brothers, anything really, to blame for the next stock market crash. Eventually, the Fed will find a reason to officially re-enter the market.

Telling readers (free of charge):

China’s investment in scientific research and technology intimidates U.S. officials who fear that the former’s emergence as an innovation powerhouse could eclipse America’s dominance as the leader in cutting edge innovations.

According to the Austrian business cycle theory, the boom-bust cycle emerges in response to a deviation in the market interest rate from the natural interest rate, or the equilibrium interest rate. As a rule, it is held, the tampering with market interest rates by the central bank sets the boom-bust cycle in motion.

In last week’s column, I mentioned that regulation of drugs was among the important subjects Andrew Koppelman discusses in his thoughtful book Burning Down the House, and this week I’d like to look at what he has to say on this topic.

To understand his arguments, though, what he says needs to be put in a wider philosophical framework. As he sees it, both libertarians and nonlibertarians like him share a goal. Both have as an ideal the notion of human autonomy. As he puts it,

In his Nations by Consent, Murray Rothbard reminds us that the concept of a nation “cannot be precisely defined; it is a complex and varying constellation of different forms of communities, languages, ethnic groups, or religions.”

What would people use for money in a genuine free market? A lot of people answer the question in this way. We really don’t know the answer for sure. It would be up to the people who live in that society. Because in a genuine free market, there would be no state at all, there would be no money mandated by the state. People would compete to establish the money they liked best. Maybe people would settle on a gold or silver standard, as they had done in the past. But maybe they wouldn’t. They might prefer electronic currency like bitcoin.