In the aftermath of its recent election debacle, Britain's Conservatives have selected Kemi Badenoch as their new leader. Badenoch describes herself as an "adherent to Austrian Economics." Will it make any difference in Britain's future?
A central doctrine of the Keynesian system is the “liquidity trap” in which consumers hold money in anticipation of higher interest rates. The act of holding money allegedly promotes “underconsumption,” continuing the economic downturn. This doctrine, however, cannot withstand scrutiny.
In a previous post titled, “Why Doe
No macroeconomics or monetary theory course is complete without introduction of the Equation of Exchange, or MV = PQ. However, this equation explains nothing, praxeologically speaking. Instead, it clouds our understanding of how money fits into our economy.
As we see from Jamaica‘s experience, attempts by the government to be entrepreneurial misallocate resources, waste money, and achieve poor results.
Like Santa, who gives free gifts to our children, people think of the state as providing services “for free.” However, the state cannot provide anything without first confiscating wealth from others—like the Grinch, who first stole all the presents in Whoville.
President-elect Donald Trump has declared that he will raise tariffs his first day in office. Our economy, however, does not need government-created roadblocks to trade. Instead, we need free exchange and sound money.
Thanks to the Fed's balance sheet and the Fed's policy on reverse repurchase agreements, it's hard to tell whether the Fed is being hawkish or dovish.
"Hurry up and wait" is often the reality of medical care. We shouldn't be surprised to know that long lines and government intervention go together.
