Why are governments so enthusiastic about shutting down businesses when other less draconian measures are available and prudent? The answer lies in the fact that governments can act with near impunity and want to maximize their power.
It is a marvel that imperfect, limited information available to the entrepreneur can be used to produce so much good for society.
There is a reason to panic. But the panic should be over how governments—who know so very little about the virus that they have decided warrants destroying the global economy—will create many new threats to health and well-being through their policies.
The costs of this government-forced economic collapse—in terms of lost lives and ruined health—are likely to be devastating.
Central bankers are panicking, and their solutions range from "buy everything that moves" to pushing interest rates even further into negative territory. Yet this doesn't seem to be helping much.
Even if the COVOID-19 virus turns out to be more severe than the skeptics give us reason to think it is, we can get through it. We cannot survive the end of the division of labor. It would be the finish of civilization as we know it.
Contrary to a recent headline, the US is not about to become the "epicenter" of COVID-19. In fact, the death rate of COVID-19 is lower in the US than at the same point in the timeline for many other countries we are told are comparable to the US.
Every crisis caused by the unbacked paper money system expands the power of the states over economic and social life, and unfortunately, once the state has expanded its power, it is unlikely the trend will be reversed.
Philipp Bagus reports from Spain: when people are frightened enough, they'll let the state do pretty much anything.
At this point, monetary policy can't save Italy. Promises from Europe's central bank have allowed Italian policymakers to avoid coming to terms with Italy's bankrupt reality. Until now.
