14 Hard Questions for Libertarians—Answered
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Protection Against the Rising Risk of a Systemic Financial Meltdown Or... a the Forgotten Role of Gold
Protection Against the Rising Risk of a Systemic Financial Meltdown or... a The forgotten role of gold Louis Boulanger, CFA, Founder and Director, LB Now Limited New Zealand Society of Actuaries 2008 Conference, 19-22 November “Gold is money and nothing else” J P Morgan, 1913, to the US Congress 2 “It is not because things are difficult that we do not dare; it is because we do not dare that things are difficult.” - Seneca (ca 4 BC - 65 AD) Roman stoic philosopher 3 “All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self- evident...” - Arthur Schopenhauer (1788-1860) German philosopher; influenced Einstein 4 Agenda h About prudence now... h The truth about money today h Economic Freedom vs. Debt & Delusion h The role of gold as a standard h The need for monetary reform h How to protect until then h Some of my sources 1. About prudence “A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences.” - Proverbs 22:3 6 The paradox of prudence h Prudence defined by man-made laws and court cases IS NOT the same as the virtue itself Who ever said that to be prudent is to imitate your peers? Is fiduciary irresponsibility not partly to blame for this crisis? h The word now seems synonymous with cautiousness In this sense, prudence means a reluctance to take risks Such reluctance is prudent only for unnecessary risks But when unreasonably extended or applied based on false beliefs, then it becomes reckless -
Quantitative Easing: Money Supply and the Commodity Prices of Oil, Gold, and Wheat
Utah State University DigitalCommons@USU All Graduate Plan B and other Reports Graduate Studies 8-2017 Quantitative Easing: Money Supply and the Commodity Prices of Oil, Gold, and Wheat Aaron Kasteler Follow this and additional works at: https://digitalcommons.usu.edu/gradreports Part of the Macroeconomics Commons Recommended Citation Kasteler, Aaron, "Quantitative Easing: Money Supply and the Commodity Prices of Oil, Gold, and Wheat" (2017). All Graduate Plan B and other Reports. 1037. https://digitalcommons.usu.edu/gradreports/1037 This Report is brought to you for free and open access by the Graduate Studies at DigitalCommons@USU. It has been accepted for inclusion in All Graduate Plan B and other Reports by an authorized administrator of DigitalCommons@USU. For more information, please contact [email protected]. QUANTITATIVE EASING: MONEY SUPPLY AND THE COMMODITY PRICES OF OIL, GOLD, AND WHEAT by Aaron Kasteler A thesis submitted in partial fulfillment of the requirements for the degree of MASTER OF SCIENCE in Applied Economics UTAH STATE UNIVERSITY Logan, Utah 2017 ii COPYRIGHT NOTICE The copyright of this thesis belongs to the author under the terms of the United States Constitution, 1909 Copyright Act, and the 1976 Copyright Act. Subsequent acknowledgement must always be made of the use of any material contained in, or derived from, this thesis. I declare that this thesis embodies the results of my own research or advanced studies and that it has been composed by me. Where appropriate, I have made acknowledgement to the work of others. Signed, Aaron Kasteler iii ABSTRACT QUANTITATIVE EASING: MONEY SUPPLY AND THE COMMODITY PRICES OF OIL, GOLD, AND WHEAT by Aaron Kasteler, MASTER OF APPLIED ECONOMICS Utah State University, 2017 Major Professor: Dr. -
Global Financial Crisis: a Minskyan Interpretation of the Causes, the Fed’S Bailout, and the Future
Working Paper No. 711 Global Financial Crisis: A Minskyan Interpretation of the Causes, the Fed’s Bailout, and the Future by L. Randall Wray Levy Economics Institute of Bard College March 2012 *This paper reports research undertaken as part of a Ford Foundation project, “A Research And Policy Dialogue Project On Improving Governance Of The Government Safety Net In Financial Crisis.” The author thanks June Carbone for comments and Andy Felkerson and Nicola Matthews for assistance. The Levy Economics Institute Working Paper Collection presents research in progress by Levy Institute scholars and conference participants. The purpose of the series is to disseminate ideas to and elicit comments from academics and professionals. Levy Economics Institute of Bard College, founded in 1986, is a nonprofit, nonpartisan, independently funded research organization devoted to public service. Through scholarship and economic research it generates viable, effective public policy responses to important economic problems that profoundly affect the quality of life in the United States and abroad. Levy Economics Institute P.O. Box 5000 Annandale-on-Hudson, NY 12504-5000 http://www.levyinstitute.org Copyright © Levy Economics Institute 2012 All rights reserved ISSN 1547-366X ABSTRACT This paper provides a quick review of the causes of the Global Financial Crisis that began in 2007. There were many contributing factors, but among the most important were rising inequality and stagnant incomes for most American workers, growing private sector debt in the United States and many other countries, financialization of the global economy (itself a very complex process), deregulation and desupervision of financial institutions, and overly tight fiscal policy in many nations. -
Preventing a Repeat of the Money Market Meltdown of the Early 1930S
PREVENTING A REPEAT OF THE MONEY MARKET MELTDOWN OF THE EARLY 1930S JOHN V. DUCA RESEARCH DEPARTMENT WORKING PAPER 0904 Federal Reserve Bank of Dallas Preventing a Repeat of the Money Market Meltdown of the Early 1930s John V. Duca* Vice President and Senior Policy Advisor Research Department, Federal Reserve Bank of Dallas P.O. Box 655906, Dallas, TX 75265 (214) 922-5154, [email protected] and Southern Methodist University, Dallas, TX April 2009 (revised November 2009) This paper analyzes the meltdown of the commercial paper market during the Great Depression, and relates those findings to the recent financial crisis. Theoretical models of financial frictions and information problems imply that lenders will make fewer non- collateralized loans or investments and relatively more extensions of collateralized finance in times of high risk premiums. This study investigates the relevance of such theories to the Great Depression by analyzing whether the increased use of a collateralized form of business lending (bankers acceptances) relative to that of non-collateralized commercial paper can be econometrically attributable to measures of corporate credit/financial risk premiums. Because commercial paper and bankers acceptances are short-lived, they are more timely measures of the availability of short-term credit than are bank or business failures and the level or growth rate of the stock of bank loans, whose maturities were often longer and were renegotiable. In this way, the study adds to the literature on financial market frictions during the Great Depression, which aside from analyzing securities prices, typically investigates the behavior of credit-related variables that lag current conditions, such as bank failures, bankruptcies, the stock of money, or outstanding bank loans. -
The Indispensability of Freedom 8Th International Conference the Austrian School of Economics in the 21St Century
The Indispensability of Freedom TITLE 8th International Conference The Austrian School in the 21st Century Federico N. Fernández Barbara Kolm Victoria Schmid (Eds.) Friedrich A.v.Hayek Institut The Indispensability of Freedom 8th International Conference The Austrian School of Economics in the 21st Century Federico N. Fernández Barbara Kolm Victoria Schmid (Eds.) Papers presented on November 13th and 14th, 2019 Published by the Austrian Economics Center and Fundación International Bases www.austriancenter.com www.fundacionbases.org Copyright ©2020 by Friedrich A. v. Hayek Institut, Vienna Federico N. Fernández, Barbara Kolm, and Victoria Schmid (Eds.) All rights reserved. No texts from this book may be reprinted or posted in any form without prior written permission from the copyright holders. Design and composition by Victoria Schmid Cover photo by Anton Aleksenko | Dreamstime.com ISBN: 978-3-902466-17-4 First Edition 2 3 4 Content Austrian Economics Conference 2019 Preface Robert Holzmann 13 The History of the Austrian Economics Conference The Editors 15 Juan Carlos Cachanosky Memorial Lecture I. The Continuing Importance of Misesian Economics Robert Murphy 17 II. Keynote: Geopolitics, Economic Freedom, and Economic Performance Erich Weede 31 1. The Role of Non-Democratic Institutions in a Democracy, according to Montesquieu, Tocqueville, Acton, Popper, and Hayek, Applied to the EU Jitte Akkermans 45 2. Mind with a purpose: a humanistic conversation between Psychology and some postulates of the Austrian School of Economics Silvia Aleman Menduinna 59 3. What Is Wrong With Sustainable Development Goals? Horacio Miguel Arana 71 5 Content 4. A Unique Methodology using the Principles of the Austrian School of Economics – Applied To Investing and Trading Richard Bonugli 83 5. -
Economics-For-Real-People.Pdf
Economics for Real People An Introduction to the Austrian School 2nd Edition Economics for Real People An Introduction to the Austrian School 2nd Edition Gene Callahan Copyright 2002, 2004 by Gene Callahan All rights reserved. Written permission must be secured from the publisher to use or reproduce any part of this book, except for brief quotations in critical reviews or articles. Published by the Ludwig von Mises Institute, 518 West Magnolia Avenue, Auburn, Alabama 36832-4528. ISBN: 0-945466-41-2 ACKNOWLEDGMENTS Dedicated to Professor Israel Kirzner, on the occasion of his retirement from economics. My deepest gratitude to my wife, Elen, for her support and forbearance during the many hours it took to complete this book. Special thanks to Lew Rockwell, president of the Ludwig von Mises Institute, for conceiving of this project, and having enough faith in me to put it in my hands. Thanks to Jonathan Erickson of Dr. Dobb’s Journal for per- mission to use my Dr. Dobb’s online op-eds, “Just What Is Superior Technology?” as the basis for Chapter 16, and “Those Damned Bugs!” as the basis for part of Chapter 14. Thanks to Michael Novak of the American Enterprise Insti- tute for permission to use his phrase, “social justice, rightly understood,” as the title for Part 4 of the book. Thanks to Professor Mario Rizzo for kindly inviting me to attend the NYU Colloquium on Market Institutions and Eco- nomic Processes. Thanks to Robert Murphy of Hillsdale College for his fre- quent collaboration, including on two parts of this book, and for many fruitful discussions. -
A Re-Visit to Minsky After 2007 Financial Meltdown Shazia Ghani
A re-visit to Minsky after 2007 financial meltdown Shazia Ghani To cite this version: Shazia Ghani. A re-visit to Minsky after 2007 financial meltdown. 2e Journée doctorale d’économie, Association des doctorants de Grenoble en économie, École doctorale de sciences économiques, MSH- Alpes, Grenoble, 17 juin 2011, Jun 2011, Grenoble, France. halshs-01027435 HAL Id: halshs-01027435 https://halshs.archives-ouvertes.fr/halshs-01027435 Submitted on 22 Jul 2014 HAL is a multi-disciplinary open access L’archive ouverte pluridisciplinaire HAL, est archive for the deposit and dissemination of sci- destinée au dépôt et à la diffusion de documents entific research documents, whether they are pub- scientifiques de niveau recherche, publiés ou non, lished or not. The documents may come from émanant des établissements d’enseignement et de teaching and research institutions in France or recherche français ou étrangers, des laboratoires abroad, or from public or private research centers. publics ou privés. A Re-visit to Minsky after 2007 Financial Meltdown By Miss Shazia GHANI PhD Student (2nd Year) Centre de Recherche en Economie de Grenoble Université Pierre Mendes France, GRENOBLE: FRANCE Presented at 2nd Journée Doctorale d‘économie ; 17 Juin 2011 MAISON DES SCIENCES DE L’HOMME, UPMF, GRENOBLE, FRANCE JEL Classification: G01, G38, E12, E44 Keywords: Keynesian and Post-Keynesian, Financial Crises and Minsky, Financial Instability; Government Policy and Regulation, Financial Markets and Macroeconomy, ABSTRACT : The 2007 financial crises has brought to eminence and a long overdue recognition to the ideas of Hyman. P Minsky who is a post-Keynesian authority on monetary theory and financial institutions. -
Government Bailouts from the Perspective of the Austrian School
Government Bailouts From the perspective of the Austrian School Author: Ásgeir Thor Johnson Instructor: Kári Joensen Bachelor essay summer 2010 Faculty of Business - Bifröst University Confirmation of a final assignment for a bachelor degree in Business Administration Title of essay: Government Bailouts Sub title: From the perspective of the Austrian School Author: Ásgeir Thor Johnson Social security number: 101288-2269 The final assignment has been evaluated according to the regulations and demands of Bifröst University and has received the final grade: _________ Abstract The subject of this essay is the effects of government bailouts on economic prosperity from the perspective of the heterodox Austrian School of economics. Proponents of the school see economics as the science of the logical implications which can be inferred from the ultimate given of human action. They also object to use of broad economic aggregates such as GDP to reach conclusions about the health of an economy. The essay’s conclusions are that government bailouts act to preserve valueless production as well as to prevent valuable production from ensuing. Furthermore, they act to decrease the overall production of an economy since they extract resources from the private sector which is more capable than the public sector to allocate resources in a productive manner. Government bailouts also create a problem of moral hazard in the form of an incentive to take on excessive risk. Therefore, they act to increase the danger of bankruptcies, impoverishing society as a whole. Key words government bailout, Austrian School, government intervention, business failure, resource allocation, capitalism, economic prosperity, moral hazard, expropriation, perverse incentives. -
Making Money: Leverage and Private Sector Money Creation
Making Money: Leverage and Private Sector Money Creation Margaret M. Blair* I. INTRODUCTION The turmoil in financial markets in recent years is encouraging some economists and financial theorists to undertake a major rethinking of how the financial sector influences the real economy, and in particu- lar, to reexamine the linkages among financial innovation, supply of credit and money, monetary policy, bubbles, financial stability, and eco- nomic growth.1 Prior to the financial crisis of 2007–2008, most finance theorists and macroeconomists tended to assume that financial market innovations would not be widely adopted or used unless they increased the efficiency with which the financial sector directed savings to invest- * Vanderbilt University Law School. Research on this Article was supported by a grant from the Alfred P. Sloan Foundation, and by the Law & Business Program at Vanderbilt University Law School. The author is grateful for helpful feedback on this Article from Morgan Ricks, Erik Gerding, Victor Fleischer, Alexia Marks, participants in the Business Law Colloquium at the University of Colorado Law School, participants in the Seminar on Regulating Financial Stability at Vanderbilt University Law School, and participants in the Seattle University School of Law Berle IV Confer- ence on The Future of Financial and Securities Markets. The author also appreciates excellent re- search assistance provided by Ronald Donado and Benjamin Harris. All errors and omissions remain the responsibility of the author. 1. See, e.g., GARY B. GORTON, SLAPPED BY THE INVISIBLE HAND: THE PANIC OF 2007 (2010); Margaret M. Blair, Financial Innovation, Leverage, Bubbles, and the Distribution of Wealth, 30 REV. -
Avoiding a Meltdown: Managing the Value of Small Change;
Avoiding a meltdown: Managing the value of small change François R. Velde Introduction and summary of the King’s power into foreign parts without espe- In 2007, the American bald eagle, a symbol of our na- cial leave from the king” (Ruding, 1817–19, Vol. 1, tion, was removed from the threatened species list. But p. 385). This was the first of many such prohibitions— another American icon (or two) might well take its sometimes under penalty of death. place on the list. On December 14, 2006, the United These prohibitions were passed at a time when States Mint announced new regulations “to limit the money was different from ours, that is, when it was exportation, melting, or treatment” of the American made of precious metals like gold and silver. Our money penny and nickel coins. The purpose of these regula- does not derive its value from its intrinsic content, tions is “to safeguard against a potential shortage of which should be immaterial. In this article, I will first these coins in circulation.” The regulations make it explain how a medieval problem can reappear in modern illegal to export, melt, or treat one-cent and five-cent times. I will provide a quick overview of the history coins of the United States, except in some cases or of American coinage, highlighting earlier instances of with the Secretary of the Treasury’s explicit permission.1 such problems, in particular the coin shortages of 1964 Our pennies and nickels, it turns out, are threat- and 1965, and what solutions were adopted then. -
Global Economic Meltdown
Contents About the Editor/Contributors . 7 Foreword . 11 Introduction . 17 1. The Global Financial Crisis and India JAYSHREE SENGUPTA . 21 2. India after the Global Economic Crisis M.K. VENU . 51 3. Organic Crisis and Capitalist Transformation MARIO CANDEIAS . 67 4. Currency War versus Monetary Cooperation FABIO DE MASI . 91 5. From the Great Recession to Deflation and Stagnation HANSJORG HERR . 105 6. Current Crises, European Union: Alternatives and the Idea of Socioecological Reconstruction of a Society beyond Neoliberalism and Capitalism JUDITH DELLHEIM . 113 6 THE GLOBAL ECONOMIC MELTDOWN 7. Europe: To Be or Not to Be FABIO DE MASI . 125 8. From Exportism and Growth Fetish towards an Ecosocialist ‘Economy of Reproduction’ MARIO CANDEIAS . 141 9. Deconstructing India’s Inclusive Development Agenda SAMIR SARAN AND VIVAN SHARAN . 147 About the Editor/Contributors Editor: Jayshree Sengupta is a Senior Fellow at the Observer Research Foundation (ORF), Delhi, India. She was a consultant for World Bank (1985- 1990) and OECD (Paris) (1991). She coauthored a book with Prof S. Sideri of ISS (Hague) on The 1992 Single European Market and The Third World (Frank Cass, London, 1992). She was a lecturer at Miranda House and Indraprastha College (Delhi University) from 1970 to 1977. She has also served as the Programme Coordinator at Indian Council for International Economic Relations (ICRIER) from 1981-1985. She had studied at the London School of Economics, where she completed MSc (Economics) and M Phil (Economics). Contributors: Mario Candeias is the Co-Director of the Institute for Critical Social Analysis at the Rosa Luxemburg Foundation. He is also on the editorial board of the reviews ‘Luxemburg’ and ‘Das Argument’. -
Banking, Currency, and Debt Meltdown: Ecuador Crisis in the Late 1990S
DRAFT OCTOBER 2001 Banking, Currency, and Debt Meltdown: Ecuador Crisis in the Late 1990s By Augusto de la Torre, Roberto García-Saltos, and Yira Mascaró* * Comments are welcome and the usual caveats apply. The views expressed in this paper are of the authors and do not necessarily represent the views of the institutions where they work. Table of Contents I. Introduction .................................................................................................................................1 II. Origins: When and How Were the Seeds of the Crisis Planted?...............................................1 A. Financial Liberalization with Lags in Institution Building................................................................2 1. Consolidated supervision failures—offshore banks and investment funds ............................3 2. Deficiencies in the framework for bank failure resolution .......................................................5 3. Too many intermediaries with low capital ...............................................................................6 4. Financial liberalization in the context of oligarchic power structures ......................................7 B. Capital Inflows, Credit Boom, and Sudden Stop (1993-96)...........................................................8 1. The surge in capital inflows and domestic credit (1993-94) ...................................................8 2. Sudden stop (1995-96) .........................................................................................................10