III. Money and Overall Prices
1. THE SUPPLY AND DEMAND FOR MONEY AND OVERALL PRICES
When economics students read textbooks, they learn, in the “micro” sections, how prices of specific goods are determined by supply and demand. But when they get to the “macro” chapters, lo and behold! supply and demand built on individual persons and their choices disappear, and they hear instead of such mysterious and ill-defined concepts as velocity of circulation, total transactions, and gross national product. Where are the supply-and-demand concepts when it comes to overall prices?
II. What Determines Prices: Supply and Demand
What determines individual prices? Why is the price of eggs, or horseshoes, or steel rails, or bread, whatever it is? Is the market determination of prices arbitrary, chaotic, or anarchic?
Much of the past two centuries of economic analysis, or what is now unfortunately termed microeconomics, has been devoted to analyzing and answering this question. The answer is that any given price is always determined by two fundamental, underlying forces: supply and demand, or the supply of that product and the intensity of demand to purchase it.
Professional soccer can only rival Major League Baseball or the NFL when it comes to corruption and socialism.
In this 21 minute lecture (”Socialized Sports: Your Money at Work”), from the 2009 Austrian Scholars Conference, Devin Leary-Hanebrin discusses the many ways that professional sports franchises extort and deceive taxpayers and local governments to keep the tax money rolling in to team owners and players.
The IRS reports that more people renounced their US citizenship during the first quarter of 2015 than during any other quarter in history. Notably, a sizable portion of those renouncing their citizenship are doing so to escape heavy taxation.
by Andy Sirkis
[Originially published at LewRockwell.com]
The policy of the Bernanke-Yellen Fed to whet investors’ appetite for risk by maintaining short-term interest rates at zero in order to pump up investment spending seems to be working quite well. Here is some anecdotal evidence as reported by a friend:
We just noticed that this video on The Fed and money — originally made in the mid 90s — has received over a million views since it was posted on Youtube in 2006. The visuals unfortunately are quite dated, although the audio remains as current as ever, even down to the discussion of the “current” economy since wages and household purchasing power are stagnating today much as they did 20 years ago. I’ve been listening to it as I do other work.
The positivist ideas dominant among economists led them to agree that, as stated by the motto of the Econometrics Society, “Science is prediction.” We are surrounded by forecasts about numerous economic indicators. “Experts” reveal the rate of growth with .1 percent precision as if they were reading the oracle or seeing the future in chicken entrails.
Preface
Although first published 25 years ago, Murray Rothbard’s The Mystery of Banking continues to be the only book that clearly and concisely explains the modern fractional reserve banking system, its origins, and its devastating effects on the lives of every man, woman, and child.
Foreword
Long out of print, The Mystery of Banking is perhaps the least appreciated work among Murray Rothbard’s prodigious body of output. This is a shame because it is a model of how to apply sound economic theory, dispassionately and objectively, to the origins and development of real-world institutions and to assess their consequences. It is “institutional economics” at its best. In this book, the institution under scrutiny is central banking as historically embodied in the Federal Reserve System—the “Fed” for short—the central bank of the United States.
