2014: “There Is No Honest Pricing Left” – The Epochal Error Of Modern Central Banking

Submitted by David Stockman of Contra Corner blog, David Stockman, Director of the Office of Management and Budget under Reagan, former Congressman, and author of the bestseller The Great Deformation: The Corruption of Capitalism in America discusses his book, the gold standard, bailouts, and the problems the American economy faces today. Mises Institute: In the book, you oppose Bernanke’s view of the Great Depression, which you point out relies heavily on the views of Milton Friedman. David Stockman: Bernanke has cultivated this idea that he is a brilliant scholar of The Great Depression, but that’s not true at all. What Bernanke did was basically copy Milton Friedman’s misguided and very damaging theory that the Federal Reserve didn’t expand its balance sheet fast enough by massive open market purchases of government debt during the Great Depression. Bernanke, therefore, claimed that monetary stringency deepened and lengthened the depression, but in fact interest […] Read More

Exorbitant Cost Of Pseudo-Educating America: The Next Two-Trillion Dollar Bubble

Submitted by Ben Tanosborn, At $1.2 trillion student debt, we may only be 60 percent along the way, but rest assured that it won’t take but 3 to 5 years before this spectacular bubble bursts… and it will do so on the economic backs of the poor, and the ghostly – ghastly might be more apropos – remnants of a fast disappearing middle class. Two weeks ago, while doing a final screening of old papers kept for no-apparent good reason, I came across a few notes from a graduate business course which I taught over three decades ago.  An underlined hyphenated-word stood in front of me teasing both my memory and reason for its use: Porno-Economics.  Then, I quickly recalled that my reason for its use had absolutely nothing to do with the economics of porn; and how I explained to my class – mostly graduate engineers with families […] Read More

2014: Kyle Bass On China’s “Contraction” And “The Fed’s Worst Nightmare”

Via Robert Huebscher, originally posted at Advisor Perspectives, For the last several years, nobody has been more outspokenly bearish on Japan than Kyle Bass. In a recent talk, Bass reiterated his doubts about Japan’s chances of averting a debt crisis. What’s more, he also said China’s economy will fall below expectations. Bass changed one aspect of his outlook on Japan. Instead of predicting a collapse of the Japanese bond market, he focused on a severe weakening of the yen – without predicting when that might happen. His predictions for China were equally distressing. He said that its banks will be saddled with non-performing loans and that its economy is actually contracting. “I don’t think the markets are discounting what’s really happening in China,” he said. Bass is the founder of Hayman Capital, a Dallas-based hedge fund. He was featured prominently in Michael Lewis’ recent book, The Big Short, for […] Read More

The Robots Are Coming, And They Are Replacing Warehouse Workers And Fast Food Employees

There are already more than 101 million working age Americans that are not employed and 20 percent of the families in the entire country do not have a single member that has a job.  So what in the world are we going to do when robots start taking millions upon millions more of our jobs? Thanks to technology, the balance of power between employers and workers in this country is shifting dramatically in favor of the employers.  These days, many employers are wondering why they are dealing with so many human worker “headaches” when they can just use technology to get the same tasks done instead.  When you replace a human worker with a robot, you solve a whole bunch of problems.  Robots never take a day off, they never get tired, they never get sick, they never complain, they never show up late, they never waste time on […] Read More

The “Economic Recovery” Continues: Businesses Are Being Destroyed Faster Than They Are Being Created

What would you say about an economy where businesses are shutting down faster than they are opening?  Well, a shocking new study released by the Brookings Institution indicates that this is exactly what is happening in the United States.  We are absolutely killing small businesses and the entrepreneurial spirit in this country, and as you will see below, the number of self-employed Americans has been on a downward trend for a decade even though our population has been steadily growing.  Traditionally, small businesses have been the primary engine of job growth in this nation, so the fact that study after study has found that small business creation is being crippled in the United States is a really bad sign for our economic future. Personally, I write about our long-term economic decline nearly every day, but even I had no idea that businesses were being destroyed faster than they were […] Read More

2014: The Number Of Working Age Americans Without A Job Has Risen By 27 MILLION Since 2000

Did you know that there are nearly 102 million working-age Americans that do not have a job right now?  And 20 percent of all families in the United States do not have a single member that is employed.  So how in the world can the government claim that the unemployment rate has “dropped” to “6.3 percent”?  Well, it all comes down to how you define who is “unemployed”.  For example, last month the government moved another 988,000 Americans into the “not in the labor force” category.  According to the government, at this moment there are 9.75 million Americans that are “unemployed” and there are 92.02 million Americans that are “not in the labor force” for a grand total of 101.77 million working age Americans that do not have a job.  Back in April 2000, only 5.48 million Americans were unemployed and only 69.27 million Americans were “not in the […] Read More

When Nations Go Broke: Mob Justice

Submitted by Simon Black via Sovereign Man blog, It was a scene just like out of the Wild West. 18-year-old David Moreyra had stolen a purse. And an angry mob gathered in broad daylight in Rosario, Argentina to lynch him. It turns out that ‘mob justice’ is on the rise in Argentina, and Mr. Moreyra’s death was just one of more than a dozen recent instances. Hundreds of years ago during the Age of Enlightenment, liberty-minded philosophers argued that governments could only derive their authority to govern by receiving consent of the governed. And that the people would have to voluntarily surrender some of their freedoms to government in exchange for certain services (and protection of their other freedoms). This idea has become twisted and mutated over time. These days, the prevailing model is that [some] people pay taxes, and in exchange the government maintains a monopoly over a […] Read More

2014: Are The Swiss Going Crazy? $25 Minimum Wage Referendum In May

Submitted by Pater Tenebrarum of Acting-Man blog, Most of our readers probably know what we think of minimum wages, but let us briefly recapitulate: there is neither a sensible economic nor a sensible ethical argument supporting the idea. Let us look at the economic side of things first: for one thing, the law of supply and demand is not magically suspended when it comes to the price of labor. Price it too high, and not the entire supply will be taken up. Rising unemployment inevitably results. However, there is also a different way of formulating the argument: the price of labor must not exceed what the market can bear. In order to understand what this actually means, imagine just for the sake of argument a world without money. Such a world is not realistic of course, as without money prices the modern economy could not exist. However, what we […] Read More

Higher Taxes Don’t Make Capitalism “Work Better”

Submitted by James E Miller of Mises Canada, “Would Capitalism Work Better With Higher Taxes?” That’s the title of a new Globe and Mail editorial written by Doug Saunders. The question is innocent enough. The article treads lightly on the topic without ideological moralizing. The dilemma of how to make capitalism “work better” is a common trope in mainstream rags. Saunders wants to come off as a moderate thinker who’s just trying to do what’s best for everyone. I suspect there’s something more sinister behind his motives.= Anyone who understands the basics of capitalism knows taxation acts as a hindrance. There is no question about this. Capitalism is the free trading of goods and services; taxation is the violent extortion of the gains of voluntary trade. Anything that gets in the way of the capitalist process necessarily hinders it. In no possible way will higher taxes make capitalism “work […] Read More