US Confronts Dinar Shortage

Meeting Iraq’s Demand for Dinars (BBC): To do any serious shopping in Iraq you need to carry around massive wads of local currency which are a real nuisance to lug about. For example, to pay for modest lunch of chicken and rice the other day I had to count out 88 of my 250 dinar notes. There is in fact a higher denomination 10,000 dinar note but most Iraqis refuse to accept them. They’re seen as tainted and lack credibility because so many of them were looted from banks after the war.

Low Interest Rates and Malinvestment

A few people are asking tough questions about the Fed’s insane policy of lowering short term interest rates.  Perhaps the problems with the economy cannot be solved by more money, rather, “the economy, particularly in Silicon Valley, must face an even stronger dose of free-market capitalism: A shake-out that weeds out weak, money-losing companies so the survivors can become stronger and more profitable.”   The easy-money policy of the 90s

Phelp’s Strange Response

Phelp’s response is very strange. He writes: “If solid old-economy investments were being crowded out in the late 1990s, corporate interest rates net of inflation would have been elevated, which they were not.” Well, they would have been elevated, unless, of course, someone in the economy was artificially holding rates down, heh? And it’s clear that he still doesn’t get the malinvestment idea, and can only think of capital as an aggregate.

Make Yourself Useful

In Portland, the restaurant chain Pizza Schmizza offered to pay homeless people a slice of pizza, soda and a few dollars in exchange for holding a sign for 40 minutes on downtown sidewalks that read: “Pizza Schmizza paid me to hold this sign instead of asking for money.” Ralph Nader didn’t like it one bit.

The Fallacies of the NRA

This year marks the 70th Anniversary of the National Industrial Recovery Act, FDR’s planning legislation that created the National Recovery Administration, the NRA. Henry Hazlitt saw precisely what the NRA would lead to, and after a dispute with the The Nation that resulted in his losing his position as literary editor, he wrote the following brilliant attack for the American Mercury.
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