Economic Policy Journal’s takeaway on the Reinhart-Rogoff fiasco:
Austrian economics reject empirical data as a method to prove economic theory, for Austrians it is all about logical deductions. Thus, there is not much for Austrians to do, relative to the current Reinhart-Rogoff destruction at the hands of a U Mass graduate student, other than to grab some popcorn and watch with bemusement from the sidelines.
The gold standard was an international standard. It safeguarded the stability of foreign exchange rates. It was a corollary of free trade and of the international division of labor. Therefore those who favored etatism and radical protectionism disparaged it and advocated its abolition. Their campaign was successful.
In a comment on Reynolds and Cochran on the Slow Recovery, Marcus Nunes argued, “If there was a lesson in the R&R fracas is that you should take care with numbers, especially if you define “tipping points”. I think 15% is below what would account for the ‘core functions’ of government.” Nunes then referred the reader to ‘Keep it simple’.
For those interested in the Euro, Andreas Hoffmann (University of Leipzig), has some interesting commentary at ThinkMarkets, A blog of the NYU Colloquium on Market Institutions and Economic Processes, “The Euro: a Step Toward the Gold Standard?”
Earlier this month I chatted with with fellow economist Morgan Reynolds on his Reynolds Reveal .
The Lawrence W. Fertig Prize in Austrian Economics for 2013 was awarded to Laura Davidson for her paper Against Monetary Disequilibrium Theory and Fractional Reserve Free Banking. It is a rigorous and insightful paper.
The Fertig Prize is awarded to the author of a paper that best advances economic science in the Austrian tradition and includes a $1000 prize.
“[T]he clique of political hacks around Karl Rove who ran the Bush White House were so unlettered in the requisites of sound money and free market economics that, over and over, they caused the nation’s top economic jobs to be filled by statists and Keynesians. Thus, professors Glenn Hubbard, Greg Mankiw, and Ed Lazear had no problem whatsoever advising George Bush that two giant tax cuts and two unfunded wars were entirely copacetic from a fiscal viewpoint. After all, the huge resulting deficits provided a Keynesian pick-me-up to the prosperous classes.”
Peter Schiff makes a few calculations on Japan’s anti-deflation campaign.
“Henry Hazlitt . . . titled his March 1969 Newsweek column “The Coming Monetary Collapse.” Hazlitt publicly warned the White House that ‘one of these days the United States will be openly forced to refuse to pay out any more of its gold at $35 an ounce.’ The result, Hazlitt insisted, would be a ‘run or crisis in the foreign exchange market’ that could end convertability entirely. ‘If it does . . .
