There is so much in the government’s official deficit figures that is phony it is hard to say what is real.

But we should add at least $89 billion to the official deficit figure. To see why, we need a bit of background.

The US government deficit is supposed to be running at around $1.2 trillion. But the government gets there by using accounting methods that would put private business executives in jail for fraud. The real deficit by different estimates should be multiples higher. This is already widely known.

Now in its 31st year, the Mises Institute’s monthly newsletter, The Free Market, is expanding into a longer, more diverse publication with more articles and interviews, plus Institute Alumni news, and the latest news from our Donors, Members, and Faculty. We’re now seeking submissions of various sorts including featured articles, movie reviews, book reviews, and one-to-four-panel comics.

As outlandish as the idea of the $1 trillion platinum coin at first appears, it gives us a glimpse of a monetary arrangement that, although far from ideal, is superior to the current system. Now that the Obama Treasury has definitely ruled out the scheme to mint the coin to circumvent the gimmicky debt ceiling, it is instructive to take a closer look at the reason why it did so and to articulate the lessons that can be learned from the episode.

Gavin Kennedy offers a nice review of Alexander Brodie’s 2012 book, Agreeable Connexions: Scottish Enlightenment links with France. Hayek, of course, locates the roots of classical liberalism in the 18th-century Scottish philosophers such as Ferguson, Smith, and Hume, while Rothbard, influenced by

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.

NBER Working Paper No. 18706

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.