Global Economy

Let us say that the present aggressive interest rate stance by the Fed fails to prevent the economy from falling into a recession; what kind of action is Bernanke then going to undertake? In some of his writings, he has suggested that, under such circumstances, the Fed should adopt a very aggressive stance and start pushing money on a massive scale, i.e., helicopter money. Needless to say that if this were to happen, Bernanke would run the risk of badly damaging the foundations of the real economy.

The crucial point to remember is that there is nothing magical about government officials.

The twenty-first century belongs to China.

 The advantages of the corporate form — limited liability and raising capital — have been known for as long as mankind has had the technology to produce useful things whose production is too expensive for a single investor to handle.

The Fed's likely continuation of its inflation in an attempt to solve the problems created by its previous inflation and the consequence that this will drive down the value of the dollar on foreign exchange markets will provide momentum for the commodity-price boom for some time.

If we can avoid the protectionist trap and reconcile the budget, the falling value of the dollar will eventually attract investors and stimulate exports.

But if investment-conference attendance is any indication, the price of gold and other commodities has a long way to go — up.

You may say it another way: that the intentions of mass production cannot be realized unless management and labor are both free. So long as that freedom existed in the motorcar industry, the cost of an automobile went lower and lower until it became, pound for pound, the cheapest manufactured thing in the world, not the Ford car only but all cars; and automobile labor at the same time was the highest-paid labor of its kind in the world.

We do know, however, that free people are better able to adapt and prosper than unfree people, in whatever situation the future holds.

In their eagerness to keep the pot boiling somehow, somewhere, many financial pundits are spinning the line that Emerging Markets now offer a form