The Wall Street Journal in its Letters section today has two good comments on Ruchir Sharma’s “How Spending Sapped the Global Recovery,” (op-ed, Jan. 16). The on-line teaser, “Nothing to Lose but Our Keynes: Government spending on infrastructure is only worth doing if it enables future value creation by the private sector.”
Popular opinion seems to be that falling prices–or even stable prices–are bad for the economy, but I’ve never seen any good arguments about why. I probably don’t need to convince followers of the Austrian school that prices work best when they reflect the underlying values of the things that are priced, but I’ve just read another article about the problems that come with deflation that gives six clearly numbered reasons. Let’s look at what the article says to see i
When L.H. White writes, people read!
Larry White has just released a must read working paper on SSRN, “Hayek and Contemporary Macroeconomics”. While the abstract is not optimistic, the paper actually provides much to encourage those pursing a capital-structure based macroeconomics and working to apply Austrian business cycle theory (ABCT) to current macroeconomic issues and policies. The abstract:
[This interview is from the December issue of The Free Market.]
Mises Institute: You recently retired after a long time at Metropolitan State University of Denver, where you were both an economics professor and the dean of the Business School. How did you end up there, and end up as dean?
There has been much hand wringing among popular blogger-economists in response to the breaking of the Euro peg by the SNB.
According to CBC News:
The Bank of Canada shocked markets today by cutting its key overnight lending rate by a quarter of a percentage point, citing the economic threat posed by plunging oil prices.
According to Source there have been several restaurants in San Francisco that have succumbed to the burden of increasing government intervention including higher minimum wages and mandatory employer spending on health care for employees. In San Francisco, if you have 20 employees working at least 8 hours per week, an employer has to spend at least $1.65 per hour on employee health insurance and related benefits.
Christine Lagarde, Managing Director of the IMF, revealed that it was a ”a bit of a surprise” that she was not informed in advance of the Swiss National Bank’s decision to dissolve the the inflationary peg with the euro. Of course, the modus operandi of central banks is to keep the public in the dark about their imminent changes in policy or to prevaricate about them.
Allan Stevo writes:
President Obama’s acolytes have begun circulating the term “middle-class economics” through the Sunday morning news programs and throughout the media.
That exact phrase “middle class economics” I’ve heard repeated 15-20 times in the media these last two days by the President’s supporters in preparation for tonight’s State of the Union address.
