... there cannot be any question of abolishing interest by any institutions, laws, and devices of bank manipulation. He who wants to “abolish” interest will have to induce people to value an apple available in a hundred years no less than a present apple. What can be abolished by laws and decrees is merely the right of the capitalists to receive interest. But such laws would bring about capital consumption and would very soon throw mankind back into the original state of natural poverty. — Ludwig von Mises

[From Socialism: An Economic and Sociological Analysis, by Ludwig von Mises, pp. 113–22.]

Mervyn King is the British Ben Bernanke. An eminent academic economist, who now teaches both at New York University and the London School of Economics, King was from 2003 to 2013 Governor of the Bank of England. In short, he is a very big deal. Remarkably, in The End of Alchemy he frequently sounds like Murray Rothbard.

According to the writings of Carl Menger and Ludwig von Mises, the driving force of interest rate determination is individual’s time preferences. What is this all about?

As a rule, people assign a higher valuation to present goods versus future goods. This means that present goods are valued at a premium to future goods.

This stems from the fact that a lender or an investor gives up some benefits at present. Hence, the essence of the phenomenon of interest is the cost that a lender or an investor endures.

On this Mises wrote,

Merry Christmas from everyone at the Mises Institute. After a year dominated by the political pageant, we hope your holidays are dedicated to what’s most important: family, friends, and communities that transcend the pettiness of politics.

Terror attacks, civil wars, and political upheaval around the world are clear signs that debate about immigration isn’t going to disappear any time soon. However, troubled times can also be a good opportunity to revisit our basic arguments and assumptions about controversial issues. They’re also a way to remind ourselves of how much we can still learn from great scholars like Mises.

 Annali D’Italianistica, “Speaking Truth to Power: From Medieval to Modern Italy.” Volume 34, 2016. Edited by Jo Ann  Cavallo and Carlo Lottieri.

Ludwig von Mises truly was an intellectual giant among men. He was perhaps the greatest economist of the twentieth century, and a tireless advocate for political liberalism and laissez-faire. Human Action, his magnum opus, stands among the truly great works of social science. But his work, based on the study of human action, transcends both economics and social theory.