Tag Archives: Debt and the Fallacies of Paper Money

  Economic and Demographic Changes We have discussed China’s debt and malinvestment problems in these pages extensively in the past (most recently we have looked at various efforts to keep the yuan propped up). In a way, China is like the proverbial “watched pot” that never boils though. Its problems are all well known, and we have little doubt that they will increasingly find expression. China’s credit bubble is one of the many dangers hanging over the global economy’s head, so to speak....

Our Argentine “Ranch Rebellion” Is Over… for Now… Mauricio Macri shortly after his election – indicating that he actually has a plan. Photo credit: Enrique Marcarian / Reuters BUENOS AIRES, Argentina – Not much action on Wall Street yesterday. The Dow sold off slightly. Gold and oil were up a bit. How about here in Argentina? “Everything has changed. Everything.” One of the analysts in our Buenos Aires office explained how the recent election of business mogul Mauricio Macri as...

  Mr. X and his Mysterious Benefactors A recent photograph of Mr. X. Photo credit; Peter Foley / Bloomberg via Getty Images As the Australian Broadcasting Corporation (ABC) reports, a money-laundering alarm was triggered at AmBank in Malaysia, a bank part-owned by one of Australia’s “big four” banks, ANZ. What had triggered the alarm? Money had poured into the personal account of one of the bank’s customers, a certain Mr. X, in truly staggering amounts. Hundreds of millions of dollars...

A Return to Gold Sorry boys and girls, you’ll have to start without us… Photo credit: Susan Candelario BUENOS AIRES, Argentina ­– “What if you were appointed to head the Fed? In your first week on the job, what would you do?” The question was not exactly serious. Neither was the answer. “We’d call in sick.” Drought, old age, traffic congestion, meanness, purple drink, bad taste, rap, suburbs, cancer, government, Hillary Clinton, restaurant music, shorts, Facebook, obesity – there are a...

  A Rara Avis – The World Is Poorer Without Him In It Dr. Tibor Machan, libertarian philosopher Our friend Dr. Tibor Machan, a greatly valued contributor to this site, has passed away on March 24. Unfortunately, we haven’t known Tibor for very long. We got into touch with him after reading some of his work at Mises.org and the Daily Bell, and asked him if he would like to occasionally publish articles on Acting Man as well. To our delight, he immediately agreed. In the time we were in...

  The Hard Rocks of Real Life Photo credit: Andrei Shumskiy BALTIMORE – The Dow dropped 174 points on Thursday, the biggest fall in six weeks. Not the end of the world. Maybe not even the end of this year’s bounce-back bull run. As you’ll recall, stocks sold off at the beginning of the year, too. Then, investors were buoyed up after central banks got to work – jimmying the credit market on their behalf. The Fed swore off any further “normalization” until later in the year. Central banks...

  The War on Cash is on! If you are used to making visits to your bank to make your credit card payments, you may find this no longer an option in the future. Some banks are no longer accepting (or limiting their acceptance) of cash deposits. The war on cash forges on. Paper money, which is indeed more or less worthless, is slowly being taken out of circulation and being replaced by digital currency. This shift presents of course the same fundamental problem as paper money itself:...

  Myths That Just Won’t Die Gold just had its best quarter in 30 years. Not surprisingly, gold bears are coming out of the woodwork en masse in the mainstream media and the analyst community (see e.g. this recent write-up by Mish on the Goldman Sachs analyst who has been screaming “short gold” since right before it started rocketing higher in early February). Below we will discuss a specific assertion that tends to be repeated over and over again. Gold had a very strong quarter, but...