[ America’s Great Depression (1963)] Study of business cycles must be based upon a satisfactory cycle theory. Gazing at sheaves of statistics without “prejudgment” is futile. A cycle takes place in the economic world, and therefore a usable cycle theory must be integrated with general economic theory. And yet, remarkably, such integration, even
Athanasios Orphanides’ recent Fed paper touches on aspects of Japan’s extended economic slump (his basic thesis: the BOJ should have done more). This paper served as a reminder of the inadequacies and limitations of mainstream analysis in explaining Japan’s long economic winter. Fortunately, though long unrecognized and unappreciated by the
According to Obama’s leading economic adviser, the current double-digit unemployment rate is obviously due to a “shortfall in aggregate demand.” Indeed, former UC Berkeley professor Christina Romer even told the Wall Street Journal that, until her chief of staff advised her not to, she intended to title a recent speech “It’s Aggregate Demand,
[An MP3 audio version of this article, read by Floy Lilley, is available as a free download .] In an attempt to fight the international credit market turmoil and its effects on economic activity and overall prices, the US Federal Reserve (Fed) keeps increasing the supply of base money — which is cash in circulation and commercial banks’ money
In view of the ongoing international financial and economic “crisis,” many investors increasingly ask, Is higher inflation inevitable? At first glance, this question appears to be rhetorical. Technically speaking, inflation can of course be prevented. Inflation is, in the economic sense, an increase in the money supply, which leads (and
Like clockwork, and as projected by the few good economists who understand the trade cycle, the liquidation phase of the current cycle began — once again, due to a central-bank-induced credit crisis. And yet again the credit crisis began in year 7 of the cycle, after close to 6 years of economic expansion, that is, the artificially pushed money
US Treasury Secretary Timothy Geithner Austrian economists have insisted that the Federal Reserve Bank helped cause the subprime housing boom that led to the financial crisis of 2008, and we are not alone in this opinion. According to Treasury Secretary Timothy Geithner, Federal Reserve policy was “too loose for too long.” Some of us see
Austrian economics is superior to Marxism in every respect, and this includes internal, sectarian squabbles. When we Austrians feel the time is ripe for another bloodletting — it keeps us strong by thinning the herd once in a while — we argue over fractional-reserve banking. If you have never had the pleasure of watching such fireworks, I point
Paul Krugman is despairing of late , because a growing number of mainstream economists are adopting (versions of) Austrian business-cycle theory. The most recent convert is Minneapolis Fed president Narayana Kocherlakota. Krugman uses the occasion to criticize what he derides as “the hangover theory” of economic slumps, in which high unemployment
Some days, it’s embarrassing to be a professional economist. On Monday, the National Bureau of Economic Research (NBER) officially declared that our recession had ended — 15 months ago. Yes, that’s right, just as more and more analysts are worried about the economy imploding again, the NBER announces that the recession ended back in June 2009. The
What is the Mises Institute?
The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard.
Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.