The Babylon Bee advertises itself as “Fake news you can trust.” The outlet produces the best satirical news, and this is especially true ever since big Democrat donors acquired large stakes in The Onion and turned it into the comedic equivalent of FDA-approved fiber cereal. At least it keeps us regularly updated on the fact that The Left Can’t Meme.
The Bee recently piggy-backed on the meme-able moment Selena Gomez whispered something evidently surprising to Taylor Swift at the Golden Globes.
The short article does a great job summarizing Austrian business cycle theory (ABCT), and the Mises Institute even gets a mention at the end: “At publishing time, Taylor Swift was spotted writing a new song about how she was breaking up with Keynesian economic theory and drawing little hearts in her new journal from the Mises Institute.”
Here is their excellent summary, which is woven into a fictional dialogue between Gomez and Swift:
“…the Federal Reserve causes the boom-and-bust business cycle through the central banking system’s manipulation of interest rates and fiat currency.”
“…inflation, as defined by Ludwig von Mises, is actually the increase in the supply of money and not the resultant increase in prices…”
“…when central banks inflate the currency they artificially stimulate economic activity creating malinvestments.”
“So that is the bubble that has to pop at some point and the Federal Reserve tries to keep the charade going as long as they can with low interest rates and cheap credit?!”
“Interest rates should be set by the amount of real savings in the economy to signal to borrowers and producers of capital goods that consumers have a lower time preference, preferring to spend their money on goods and services later. When the real savings are shown to not be there to justify all this economic activity, all those new industries and consumer products will collapse.”
“And Mises wrote about all this in his 1912 Theory On Money And Credit? And Friedrich Hayek won a Nobel Prize in economics in 1974 after advancing this so-called Austrian business cycle theory?”
This summary demonstrates a better understanding of ABCT than what I’ve seen in some peer-reviewed academic journals. It’s certainly better than Krugman’s mangled treatment.
Read the full article here.
