Booms and Busts

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Eurodollars as a Fractional Reserve Market

Booms and BustsInflationMonetary PolicyU.S. Economy

Blog08/14/2023

We should not just be concerned about problems in the American banking system, but also about the proliferation of Eurodollars.

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Producers, Not Consumers, Are the Engine of Economic Growth

Booms and BustsCentral BanksInflationKeynesMonetary Policy

Blog06/28/2023

The Keynesian prescription for an economic downturn is for government to increase spending to improve so-called aggregate demand. In reality, this is a recipe for worsening the recession.

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Housing Prices Are Falling As Reality Sinks In

Booms and BustsThe FedBusiness Cycles

Blog06/28/2023

Rental prices are falling as the markets adjust to new realities. The Austrian business cycle theory explains why this is happening.

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Banks Create Money out of Thin Air. What Could Possibly Go Wrong?

Booms and BustsThe FedInflationMoney and BanksMoney and Banking

Blog06/22/2023

How can a bank “create money out of thin air”? We must enter the magical kingdom of “fractional-reserve banking,” where deposits are turned into loans, loans are turned into money, and so on, to find out.

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The Fed Has Rigged the Stock Markets to Crash

Booms and BustsThe FedInflationU.S. EconomyBusiness Cycles

Blog06/19/2023

The Fed's latest attempt to correct the inflation it caused is putting the market on a crash course.

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Is the US Banking Crisis Over? It Has Barely Begun

Booms and BustsThe FedMoney and BanksU.S. Economy

Blog06/02/2023

Fractional reserve banking by itself undermines both the banking system and the economy. No action by the Federal Reserve can eliminate the threats.

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Higher Corporate Profit Margins Aren't Causing Inflation

Booms and BustsEconomic PolicyInflation

Blog05/30/2023

The usual suspects such as Robert Reich claim that corporate profits are causing inflation. Actually, increases in corporate profits are tied to increases in inflation.

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The Bankruptcy Caravan Is Now Arriving: Time to Pay for the Easy Money

Booms and BustsThe FedInflationU.S. EconomyBusiness Cycles

Blog05/29/2023

As the Fed increases interest rates to reverse the inflation it has caused, firms that depended on easy money will face the bankruptcy judge. Stay tuned; there's more to come.

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How Markets Self-Corrected during the 1819 and 1919–21 Recessions

Booms and BustsKeynesMonetary PolicyU.S. EconomyBusiness Cycles

Blog05/23/2023

With the US economy facing a severe downturn, we should remember that two recessions ended quickly because the government didn't intervene at all.

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Does GDP Present an Accurate Picture of the Economy? Not Likely

Booms and BustsEconomic PolicyThe Fed

Blog05/03/2023

The most popular measure of economic growth is GDP. However, GDP movement is driven by changes in the money supply, not real economic factors.

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