NBER has just published a paper, “The Golden Dilemma.” by Claude B. Erb and Campbell R. Harvey. The paper examines several issues regarding the use of gold in financial portfolios. It finds that many of the arguments for owning gold are questionable. For example they find that gold is not a good inflation hedge in the short run (several years) because it does not correlate well with the Consumer Price Index. However, they find that it is good to have during hyperinflation.
A few years ago an economist colleague of mine debated a professor from our university’s school of public health on gun violence and gun control. My colleague walked through the empirical evidence on the effects of gun control laws on crime, accidental injury, and other social ills, citing well-known studies by economists and legal scholars such as John Lott, John Donahue, Gary Kleck, Ian Ayres, etc. As Circle Bastiat readers probably know, the empirical social science evidence, while not conclusive, suggests that stronger gun control leads to increased rates of gun violence.
[Editor’s Note: This month marks the 250th anniversary of the beginning of the American Revolutionary War at Lexington and Concord. This selection is taken from Murray Rothbard’s extensive five-volume work on the American Revolution: from Conceived in Liberty, volume 3, part 69, “The Shot Heard Round the World: The Final Conflict Begins.”]
[This article is excerpted from Conceived in Liberty, volume 1, chapter 6, “The Social Structure of Virginia: Bondservants and Slaves”. An MP3 audio file of this article, narrated by Floy Lilley, is available for download.]
A very good discussion on why money matters: “Fed’s policies expose mainstream fallacies” Dr Frank Shostak, at: http://www.cobdencentre.org/2013/01/feds-policies-expose-mainstream-fallacies/. The conclusion:
Contrary to mainstream thinking the aggressive policies of the Fed have highlighted the destructive nature of loose monetary policy – hence money supply matters more than ever.
Robert Higgs in “Monetary Policy and Heightened Price Volatility in Raw Materials Markets” provides a very good companion piece to Mark Thornton’s “Where Is the Inflation?”
A highlight:
Dallas Federal Reserve President Richard Fisher in a recent speech called for an end of the “too big to fail doctrine.” He identified the dozen largest US banks (which represent almost 70% of all banking assets) as a continuing threat to the American public. He basically admitted that all the layers of bank regulation, including Dodd-Frank, are both overly complex and unlikely to succeed in preventing future bank bailouts.
Corners not craters: A “GDP Fetish” In today’s WSJ the ever insightful David Henderson reviews Keynesian Alan Blinder’s new book on the financial crisis After the Music Stopped. A highlight:
