The Social and Economic Side Effects of Negative Interest Rates
Negative interest rates lead to zombie firms, rampant consumerism, and growing obstacles to entrepreneurship.
Negative interest rates lead to zombie firms, rampant consumerism, and growing obstacles to entrepreneurship.
Since government creates nothing itself, all interventions are nothing more than transfers of wealth for the benefit of some and the destruction of wealth for everyone else.
Demand for gold tends to increase as faith in government and government intervention in the economy declines.
All price changes have real effects on demand for goods, and therefore alter goods' prices relative to one another. For this reason changes in the money supply can't fail to affect resource allocation.
Thanks to central banks, people now believe the myth that it is possible to shut down the economy and everything will be fine if we just print a lot of new money.
The conventional view is that new money creation is no problem so long as the demand for money is increasing. The conventional view is wrong.
There's more saving and less spending. This would bring deflation, but there's a catch: we're making less stuff, which means more money chasing fewer goods.
Without a monopolist central bank, market forces would restrain the issuance of bank notes. But once central banks monopolize money creation, wealth is systematically transferred to the central bank and the privileged few who are favored by the state.
If we choose to break the state monopoly of money and allow private digital currencies to compete, a myriad of different solutions will emerge to serve a myriad of different needs.
Without a monopolist central bank, market forces would restrain the issuance of bank notes. But once central banks monopolize money creation, wealth is systematically transferred to the central bank and the privileged few who are favored by the state.