In Argentina, the libertarian presidential candidate Javier Milei made headlines when he came in first in the primary on August 13. His economic program calls for a strong reduction in government spending and the role of government in general and would, if implemented, greatly improve the conditions of economic life in Argentina.
There is, however, one weak point—namely, his proposed monetary reform. Faced with high inflation rates and a depreciating peso, Milei proposes to dollarize the Argentinian economy. The details are not clear, but the idea is to swap pesos for dollars at the market rate (effectively making pesos claims on dollars) before finally abolishing the Argentinian peso.
All contracts, assets, and demand deposits would from then on be denominated in

Like the arsonist who then heroically fights the fire he set, the Fed is increasing its efforts to bail out banks both at home and abroad. This does not end well.

Original Article: "Is the Fed Trying to Bail Out the World? Sure Looks Like It"
This Audio Mises Wire is generously sponsored by Christopher Condon. 

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The collapse of Swiss banking giant Credit Suisse recently was a catastrophe long in the making. A quick perusal of the bank’s financial statements from recent years shows that we’re dealing with something analogous to a classic bank run. Credit Suisse’s pool of liquid assets declined more than 50 percent from 2021 to 2022, mostly in October 2022, from CHF 229.9 billion to CHF 118.5 billion as depositors withdrew their money. Despite the timing, however, the fall of Credit Suisse had little directly to do with the collapse of Silicon Valley Bank and a lot to do with the contraction of the international monetary system.
The Contractionary Fed
As pointed out last year, the Federal Reserve has long pursued a deflationary policy. This may come as a surprise, since

Since the awarding of the Nobel Prize in economics to Ben S. Bernanke, Douglas W. Diamond, and Philip H. Dybvig, most of the media interest has, understandably, concentrated on Bernanke. Mark Thornton wrote a scathing takedown of bailout Ben, while Tyler Cowen inexplicably praised him to the skies (Cowen at least provides a good overview of some of Bernanke’s contributions, such as they are).
This has allowed Diamond and Dybvig (DD) to escape much scrutiny, which is a shame, since their work is even more symptomatic of the state of modern economics and mainstream analyses of money and banking than that of bankster darling Bernanke. DD have arguably also had much more influence on how economists analyze banking. Their seminal 1983 paper in the Journal of Political

We are now well past the corona crisis of 2020, and most of the restrictions around the world have been repealed or loosened. However, the long-term consequences of arbitrary and destructive corona policies are still with us—in fact, we are now in the middle of the inevitable economic crisis.
Proclaiming the great crash and economic crisis of 2022 is at this point not especially prescient or insightful, as commentators have been predicting it for months. The cause is still somewhat obscure, as financial and economic journalism still focuses on whatever the Federal Reserve announces. But the importance of the Fed’s moves is greatly exaggerated. The Fed cannot set interest rates at will; it cannot generate a boom or a recession at will.
It can only print money and

Throughout the corona “pandemic” the Holy Grail of public health officials has been vaccination: only by vaccinating enough people—first the elderly and infirm, then all adults, and now even children—can the nefarious virus be beaten. As vaccination has proven less than wholly successful in preventing the spread of coronavirus, with studies showing rapidly declining protection from the vaccines, governments have doubled down, introducing not only “booster” shots for the vaccinated but also suggesting that the unvaccinated must be pressured and, if necessary, compelled to accept the vaccine.
Rising skepticism of the efficacy of these policies, let alone their morality, is understandable. However, it is not surprising that the medical establishment of modern states

Having marked the quinquagenary of the destruction of the gold standard Sunday, August 15, it is natural to be a little nostalgic for the Bretton Woods system. After all, it might not have been the classical gold standard, but at least it wasn’t as bad as the fiat standard that succeeded it. As sites such as wtfhappenedin1971.com document, that year indeed looks to be a turning point in the economic history of the West. However, the suspension of convertibility of dollars into gold was simply the logical outcome of the system. The PhD standard was not an arrangement that emerged by default in 1971, as governments tried desperately to patch up the international monetary system before its final breakdown in 1973; Bretton Woods was itself the original ideal of

The economic analysis of repudiation applies to the debt of all levels of government and to all countries. The central question is not how big the government is or how much it owes, but rather whether the debt is funded by taxes.

Original Article: “The Economics and Ethics of Government Default, Part II”

In the first installment of this series on government default, we examined the ethical status of the public debt and debt repudiation. Since the debt represents an unjust imposition on the taxpayers, we concluded that the moral thing to do would be to repudiate it and refuse to pay even one cent more to the state’s creditors. In this installment, I will examine what the economic consequences of such a radical policy will be. Such an examination is necessary,