by Andreas Hoffmann (University of Leipzig) In a recent piece Jesus Huerta de Soto (2012) argues that the euro is a proxy for the gold standard. He draws several analogies between the euro and the classical gold standard (1880-1912). Like when "going on gold" European governments gave up monetary sovereignty by introducing the euro. Like … Continue reading The Euro: a Step Toward the Gold Standard?
by Chidem Kurdas The Greek economy continues to shrink. With the wider European debt crisis and slump hampering Greek recovery, the recession may persist through 2013. Amid the grim news, however, there is a small sign that austerity measures are starting to work. This evidence is not widely known or reported. I heard about it … Continue reading Emerging Hope in Greece
by Bill Butos Federal Reserve Chairman Ben Bernanke is pushing for another significant round of “quantitative easing” – now dubbed “QE2” by Fed observers – on the grounds that the economy’s response to simulative macro policies since 2008 has been anemic. What the economy needs, this thinking goes, is some inflation. While much of the … Continue reading Up, Up and Away (Again)
KEYNES HAYEK 1932 Cambridge vs.LSE by Mario Rizzo My friend economist Richard Ebeling has discovered two extremely important letters. (Click the link above.) In 1932 before John Maynard Keynes’s General Theory was written, these letters appeared in The Times of London regarding the appropriate economic policies for Britain to follow during the slump. There are … Continue reading Keynes versus Hayek: Past is Prologue
by Mario Rizzo Some time ago I wrote a post with this name. Now Paul Krugman is at it again with his ex-cathedra pronouncements. He says that because of the recent planned move by European countries in the direction of austerity and the talk in the US about austerity, we are on the verge on … Continue reading Paul Krugman, Ipse Dixit 2
by Mario Rizzo I have not posted in a while since I have been on vacation. During that time an interesting dispute has arisen among friends Tyler Cowen, David Henderson, Arnold Kling, Peter Boettke, Bob Murphy, Steve Horwitz and others over whether Ben Bernanke was right to bail out specific banks. (Some of this has … Continue reading Avoiding Deflation Without Bailouts
by Jerry O'Driscoll In an interview with The Wall Street Journal, German Chancellor Merkel called for an end to risky growth policies built on asset bubbles. "In recent years we've had the Asian crisis, the new economy crisis, and now this great international financial and economic crisis -- we can't slide into a crisis every … Continue reading Bubble or Growth?
by Mario Rizzo Paul Krugman has written a column stating that wage cuts at this time are a bad idea. Following Keynes he claims that nominal cuts will do no good – they will not stimulate employment (or prevent unemployment) – because aggregate demand will fall. Real wages will thus remain unchanged. In part, Keynes … Continue reading Relative Prices Matter At All Times