Even if the "debt deflation" scenario is generally right, the absolute effect could be swamped by the relative effects, meaning that retirees on fixed dollar incomes could still get wiped out when their standard monthly expenses rise.
Government spending merely directs scarce factors of production away from their most productive uses.
He contrasts the rapid recovery of the economy following the 1920–1921 depression, when the government adopted a "hands-off" policy, with the disastrous stagnation of the economy in the 1930s, during Roosevelt's New Deal.
The whole notion of paying off past investors with the funds of present investors is at the very core of the Social Security system. At least Madoff sought the consent of his investors who let him care for their money based on their own volition. And at least he didn't attempt to defend himself with the claim that he was conducting wise public policy.
Bubble activities are not self-funded; they require money "out of thin air," which is employed to divert real savings to them from wealth generators.
The downward manipulation of the interest rate drives a wedge between the (real) market interest rate and the societal time-preference rate, and therefore wreaks havoc with the economy's intertemporal production structure.
Austrian economists are not fooled, because they reject the idea of empirical data in the validation of theory in the social sciences.
We suggest that inflation is not rises in prices as such but the debasement of money.
Obama's actions have already laid the foundation for a gigantic bubble and a further weakening of economic fundamentals.
If anything, all the rescue packages and all the massive pumping by the Fed has made things much worse as far as the underlying economic bottom line is concerned.
