[This is the first in a series of articles that seeks to provide the intelligent layman with sufficient knowledge of sound economic theory to enable him to understand what must be done to overcome the present financial crisis and return to the path of economic progress and prosperity.]
A disastrous economic confusion, one that is shared almost universally, both by laymen and by professional economists alike, is the belief that falling prices constitute deflation and thus must be feared and, if possible, prevented.
John Taylor, once consider a possible Greenspan successor, has blasted the Fed for running what he he calls Mondustrial Policy, which amounts to picking winners and losers in the marketplace via monetary policy. Taylor is not an Austrian but at least he is aware that too much pumping is bad news.
The costs of the Great War were truly astronomical. As with the number of stars, the final accounting is in God’s hands. The slaughters, the treasure, the faith in some kind of order of society—all of these were costs of the war.
