It must be a boom time for commodity traders. By any measure, whether in the news, on TV, or in stores, prices are increasing. Here’s some headlines, starting with Reuters on Sunday: U.S. gasoline prices soar to highest since 2008 on Russia conflict -AAA And today : London nickel prices soared as much as 30.7% on Monday, their biggest daily
Few things are certain, but the American government’s intent on inflicting economic hardship across the world is abundantly clear. There is no way Russia will take its sanctions lightly. They’ve already started fighting back with sanctions of their own. If this is part of the plan that US (pro-war) policy makers expect, it looks like a long and
This Wednesday, Federal Reserve Chair Jerome Powell will address the world to likely announce the raising of interest rates. With the first rate hike in several years and the promise to reduce the balance sheet later this year, the stage for 2022 will be set. Also tomorrow, per CNN : Moscow needs to hand over $117 million in interest payments on
The Fed has finally raised its benchmark interest rate in order to fight (price) inflation. If this strategy makes sense, it’s reasonable to ask: Are low interest rates the cause of currency debasement? To accept this idea, one must accept that low rates caused the increases in the price of gas, groceries, cars, drugs and college tuition. The boom
Following the first interest rate increase in several years, Federal Reserve Chair Jerome Powell provided some interesting predictions for the year ahead. Starting with his thoughts on the likelihood of a recession: I would start by saying that, in my view, the probability of a recession within the next year is not particularly elevated. He
March 23, 2020 was one of the greatest stock market buying opportunities of all-time. CNBC gives an account of the event: The S&P 500 would not bottom until March 23, a week later. From the Feb. 19, 2020, high to the March 23 bottom, the S&P would decline about 34%. Five months later, as if moved by some Miraculous Monetary Technique : Then,
Let’s say a house is on fire. The fire department shows up, except rather than spraying water on the fire, they spray gasoline. Moments later they are shocked the fire has gotten out of control. Yet here we are. The central planners are fighting inflation with more inflation. In Canada, the province of Quebec plans on giving individuals who make
It seems strange, but not surprising, how many of the economic problems the nation is facing today have already been experienced in the not-too-distant past. High (price) inflation, rising interest rates, and a recession are all hallmarks of the early ‘80’s, with many of the economic woes being caused and purportedly solved by the Federal Reserve.
Governor Lael Brainard gave an eloquently titled speech on April 5 called Variation in the Inflation Experiences of Households . The speech centers around the “heterogeneity of experienced inflation,” or the understanding that individuals experience currency debasement in a variety of ways. Not that a central banker would ever say it in such
Take a look at the Federal Funds Effective Rate chart (below) to see if you find a recurring pattern: Notice the ten official recessions (grey shaded areas) since 1955. From a purely visual perspective, it seems successive interest rate increases, leading to a rate spike, normally precede a recession. If true, how can this be explained? It could
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.