It has been interesting to read reactions to the recent speech ( Deflation: Making Sure “It” Doesn’t Happen Here ) given by Fed Governor Ben S. Bernanke before the National Economists Club in Washington, D.C., on November 21, 2002. Most commentators have focused, with merit, on Bernanke’s alarmingly sanguine approach to monetary inflation as a
Franklin Raines, speaking for the Bush administration, says that he is in the “American Dream business.” Raines is chairman and CEO of Fannie Mae, a corporation whose mission is “to tear down barriers, lower costs, and increase the opportunities for homeownership and affordable rental housing for all Americans. Because having a safe place to call
Once lauded in congressional love-fests and accorded rock-star-like status by legions of stock market investors, Federal Reserve Chief Alan Greenspan is increasingly being attacked by critics. A previous generation of promoters blamed Greenspan for raising interest rates in 2000 and causing the bear market. A new set of critics now claims that
As a young man, Alan Greenspan considered himself to be a partial follower of Ludwig von Mises. Like Mises, he wrote in favor of capitalism, free markets, and sound money. He cofounded a successful economics consulting firm and earned a Ph.D. in economics at Columbia University. He served as chairman of President Ford’s Council of Economic
The Federal Reserve System may have run out of room to maneuver. Facing a looming recession, it resolutely lowered its discount rate and frantically expanded its credits. Eager to stimulate the sagging economy, it enabled and encouraged businessmen to invest more and consumers to go ever deeper into debt. Yet the specter of recession refuses to
It is surely more shameful to lose a good reputation than never to have had one. During the great equity bubble of the 1990s Alan Greenspan acquired an illustrious reputation as the world’s greatest central banker and staunch guardian of the U.S. dollar. His admirers in the U.S. Congress never tired of applauding him and Queen Elizabeth of the
In commenting on the ongoing Japanese slump, President Bush made the worst gaffe of his presidency. Bush relayed to a news conference that he and Prime Minister Junichiro Koizumi had discussed the “devaluation issue” in their talks. As the yen sank, the White House quickly clarified that Bush had meant the “deflation issue.” It’s true that
For the time being, the Fed’s decision makers have decided to keep the federal funds rate target unchanged at 1.75 percent. They hinted, however, that if the economy were to slow further, they would lower the rate. Some commentators have protested that the Fed should not lower rates because doing so will dilute the strength of this tool in
Frank Shostak is an economist at Man Financial, Australia. He was interviewed following the announcement of the Fed’s latest policy move. Mises.org: The Fed has lowered the interest rate, again, and it seems that the whole world is celebrating. Frank Shostak : Actually, it is a disastrous move, so far as I’m concerned. Last year, the Fed cut
The Free Market 20, no. 12 (December 2002) The Federal Reserve System may have run out of room to maneuver. Facing a looming recession, it resolutely lowered its discount rate and frantically expanded its credits. Eager to stimulate the sagging economy, it enabled and encouraged businessmen to invest more and consumers to go ever deeper into
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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.