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[This article is chapter 6 of Breaking Away: The Case for Secession, Radical Decentralization, and Smaller Polities.

Although the Federal Reserve and the European Central Bank’s message regarding interest rate cuts seems clear, reiterating their commitment to reducing inflation, the market is expecting between five and six interest rate cuts, between 125 and 150 basis points, in the next twelve months.

I previously produced a chart like this one below. There I showed the US Federal Reserve Liabilities normalised to 1914 dollars. This has the effect of visually amplifying the massive currency creation around the World War I and World War II. It does not change anything but puts them all into the same dollar value terms and so we are comparing ‘apples with apples’.

In response to the Israeli assault on Gaza, the Houthis (Ansarallah) of Yemen have retaliated by launching at least six drone attacks directed at Israel and attacking Western ships passing through the Red Sea. By the looks of it, their attacks have been quite successful thus far: Israel’s Eilat port alone has seen an 85 percent drop in shipping activity.

Whenever an economy falls into a recession, many economists point out that the economic slump means there will be idle capital and labor. Resources that could be employed are now unemployed because the economic slump has softened aggregate demand for goods and services.

So-called experts believe the government must increase the overall demand in the economy since stronger demand will permit idle resources to be employed again. Hence, many economists recommend that the central bank adopt an easy monetary stance to strengthen aggregate demand.

[This article is chapter 5 of Breaking Away: The Case for Secession, Radical Decentralization, and Smaller Polities.

The Program for International Assessment (PSA) recently released its 2022 assessment of the math and reading skills of students from over 200 countries. This is the first assessment since 2018 and it provides more evidence that schoolchildren were damaged by the COVID hysteria. American students’ math scores were lower than 27 of the 38 members of the Organization for Economic Cooperation and Development (OECD). The other OECD countries do not have any reason to celebrate, as the average math scores of students in all OECD countries declined by 17 points.