Tag Archives: 6b) Mises.org

Home price growth of the sort we’ve seen in recent years simply cannot be sustained without a continued commitment to easy money from the central bank, and it shows. Home prices continued to slide in August as the economy cooled, and as the Fed hit the Pause button on quantitative easing while allowing interest rates to rise. Home prices in August were 13.0 percent higher nationally compared with August 2021, according to newly released data from the S&P...

Money supply growth fell again in September, dropping to a 37-month low. August’s drop continues a steep downward trend from the unprecedented highs experienced during much of the past two years. During the thirteen months between April 2020 and April 2021, money supply growth in the United States often climbed above 35 percent year over year, well above even the “high” levels experienced from 2009 to 2013. During September 2022, year-over-year (YOY) growth in the...

In recent decades, every instance in which the economy contracted two quarters in a row has coincided with a recession. Nonetheless, the Biden Administration and the leadership at the Federal Reserve insist there is no recession now, nor is one even in the works. On the other hand, declining GDP growth, rising credit card debt, disappearing savings, and falling disposable income all point to recession. And now one of the most closely watched recession indicators is...

For those who would find relief knowing the Bible sanctions a market-derived medium of exchange, Gary North’s Honest Money will come as a godsend (no pun intended). Even for those reprobates who forswear a religious worldview, his book will provide a solid grounding in monetary theory and history. North’s vast understanding of money and banking coupled with his lean, no-jargon writing style takes the labor out of reading. His narrative carries us on a journey from...

It is not possible to establish the conditions of the economy by just inspecting the data as a whole, according to many economists. What is required, instead, is to break the data into its key components, which supposedly will enable economists to identify the true state of the economy. Components That Drive the Data According to popular thinking, data that is observed over time—labelled as time series—is driven by four components, these are: The trend component The...

I’ll begin with a provocative thesis: socialism is ideological and free market thinking, while involving myth, is nonideological. I will show why socialism is ideological and why free market thinking involves myth but is nonideological by defining the terms myth and ideology and distinguishing them from each other. The term “myth” has several connotations. The most common connotation today is that myth represents false belief. Thus, we see many uses of the term myth...

Since I am an economist and my school year is not too far along, my classroom discussion of how all of economics traces back to the fact of scarcity (the combination of limited resources, which implies a limited ability to produce, along with wants that always exceed the amount that can be produced) facing everyone was quite recent. That was why Brad Polumbo’s recent article, “What AOC and Nina Turner Get Wrong about the ‘Scarcity Mindset,’” so quickly drew my...

Governments and central banks have become the lender of first resort instead of the last resort, and this is immensely dangerous. Global debt soars, inflation creeps in, and many of the so-called supply chain disruptions are the result of zombification after years of subsidizing low productivity and penalizing high productivity with increased taxes. There are many reasons why nations should not “spend now and deal with the consequences later.” First, the spending is...

Quantitative easing was designed as a tool to provide time for governments to implement structural reforms, boost growth, and strengthen the economy. However, it has become a tool to increase the size of government and take increasingly riskier levels of debt. The United States economy has not strengthened in the period of enormous fiscal and monetary stimuli, as the latest data shows. It needs increasing units of debt to generate a new unit of gross domestic product...

For many commentators, a change in the shape of the differential between the long-term interest rate and the short-term interest rate—i.e., the yield spread provides an indication of the likely direction of the economy in the months ahead. Thus, an increase in the yield spread raises the likelihood of a possible strengthening in economic activity in the months to come. Conversely, a decline in the yield spread is seen as indicative of a possible economic downturn...