Money and Banks

Not only will easy-money policy not increase production, it will impoverish us by inflating away real wealth.

The market probably interprets correctly that the European Central Bank will become even more dovish under Lagarde. This will encourage more risk in the financial system.

Since Libra is an extended arm of the current financial system, first-world economies could benefit at the cost of developing economies.

 A major factor that can explain the apparent contradiction between weakening so-called fundamentals of today — and the stock market's continued march upward — is changes in monetary liquidity.

Government manipulation is shifting wealth from Main Street to Wall Street. But most people don't see the growing gap between the growth of financial wealth and the real economy.

Given that Fed policymakers are of the view that a decline in the annual growth of prices is bad for the economy they are most likely to embark on very easy monetary policy in near future.

Libra's value is based on a basket of goods tied to government fiat currencies. Needless to say, Zuckerberg is no Hayek. And the Libra is no Bitcoin.

There is reason to believe low-interest rate policy has lowered productivity, lessened economic growth, and favored large firms at the expense of small firms and innovation. Greater inequality and stagnating wealth has resulted.

The gold price is heading up at the moment, but we can still learn a lot from three big collapses in the gold price which occurred after 1934.

The central bank can try to manipulate the interest rate to whatever level it desires. However, it cannot exercise control over the underlying interest rates as dictated by people’s time preferences.