Somehow, someway, it always comes back to the central bank. Alan Greenspan is letting it be known that rate cuts are not out of the question. The hint alone sent the financial markets soaring. Yet, writes Lew Rockwell, to attempt more artificial credit injections at this stage is extremely dangerous.
Let us repeat the following: Bill Clinton did not give us an era of permanent prosperity. Nor did his administration present the picture of "fiscal restraint." His administration created the economic boom that turned to bust, and now it is George Bush's turn to make a bad situation worse. William Anderson explains.
The combination of collapsed pensions and accounting scandal is operating like the collapse of a dam, unleashing a torrent, not of water, but of hatred--hatred of capitalism and its most visible and valuable representatives: big businessmen. George Reisman counters propaganda with analysis.
Special-interest-group pleading often tries to hide behind supposedly economic arguments. It is important to debunk such arguments as they arise so that the interest group politics can be seen for what it is. In the spirit of Bastiat's Economic Sophisms, Gene Callahan offers the following.
Contrary to popular thinking, the stock market does not have causative powers as far as economic activity is concerned. The prices of stocks only reflect individuals' assessments of economic reality. And while individuals can change their evaluations of economic facts, writes Frank Shostak, they cannot alter the facts themselves.
Errors are an inevitable part of human action, writes Gene Callahan. If the future were certain, we would not need to act. Yet many economic models assume all economic actors possess perfect information, all plans are coordinated, and all adjustments to new data are made instantly and without cost.
As soon as Abraham Lincoln and the new Republican Party gained power, the average tariff rate was quickly raised from a nominal 15 percent to 47 percent and higher, and remained at such levels for decades after the war. South Carolinian John C. Calhoun's free-trade arguments, as eloquent and advanced as they were, were no match for a federal military arsenal.
It is time to recognize that food prices will likely continue to fall over the long term, and that the number of commercial farmers will continue to diminish and to recognize the benefits such a trend confers upon society. It should also be made apparent that to continue to fight this trend is futile, and that it is a waste of time and money—not to mention the outright theft involved in seizing money from one group only to give it to another.
Insider trading laws, writes Dale Steinreich, have empowered the SEC to undertake a mission in information egalitarianism that favors certain classes of investors and strategies, and not others. Martha Stewart and ImClone have the book thrown at them, while the stock sales of Apple Computer's executives are ignored.
Fannie Mae's monopoly privileges have given it an ever-increasing share of the secondary conforming mortgage market, writes Robert Blumen, and it currently is seeking to expand into other parts of the mortgage market. The net result has been a nightmare of resource misallocation and massive systemic risk.
