They call it “easy money.”  We live in a world where the flick of a switch or click of a mouse can create billions to trillions of dollars which are then loaned out to certain members of our society. That said, paying back that money is not as easy…

In the case of the Fed’s $7.9 trillion balance sheet, when will this get repaid? Where will that money come from?

From the Late Middle Ages to the nineteenth century, Europe transitioned from being one of the most backward regions in the world and became the world’s economic powerhouse. How did this happen? One reason, as shown by Ralph Raico, is Europe’s unusual political decentralization.

It’s been said by democracy’s critics that the system is essentially two wolves and a sheep deciding what’s for dinner. But to its defenders, democracy has been described as an ethical ideal and a way of life—these conceptions nearly implying a metaphysical manifestation. While we have no way of knowing whether or not we’re living up to democracy as an ethical ideal, we do have evidence of its effectiveness as an electoral system, or lack thereof. If the goal is to secure good governance, then democracy generally fails.

While the recent clamp-down on power from public universities has mainly been in the realm of speech and expression, like almost every other government institution, they have used covid-19 as an opportunity to control students further. Much to my dismay, this week I learned that my alma mater, Indiana University, has instituted a “COVID-19 Vaccine Requirement,” their website stating:

[This article is part of the Understanding Money Mechanics series, by Robert P. Murphy. The series will be published as a book in 2021.]

In chapter 7 we summarized some of the major changes in how central banks have operated since the 2008 financial crisis. In the present chapter, we detail some of the even more recent changes in Federal Reserve operations since the onset of the coronavirus panic in March 2020.

The increase in the growth rate of the Consumer Price Index (CPI) has fueled concerns that if the rising trend were to continue the Fed is likely to tighten its interest rate stance. Observe that the yearly growth rate in the CPI climbed to 4.2 percent in April from 2.6 percent in March and 0.3 percent in April 2020.

We hold that because of massive increases in the money supply, it is likely that the growth momentum of prices is going to follow a rising trend.

A good definition of the tragedy of the commons is that “resources that are unowned and/or unownable will be plundered to extinction.” Consider the fish in the seas, especially those that migrate, such as whales, or may be found beyond any nation’s territorial waters. No one owns them and it may be impossible to own them. Therefore, fishermen are incentivized to take them before other fishermen take them. Overfishing results. Catches shrink. The size of the fish shrinks.