Beside signing appropriations bills containing $20 billion in pork before leaving town last week, the 106th lame-duck Republican Congress left another nasty surprise for individuals wanting to save money on their health care expenses: it failed to renew the pilot program for medical savings accounts (MSAs). MSAs were introduced in the U.S. four
Republican Richard M. Nixon closed the gold window Aug. 15, 1971, breaking the last monetary link with the precious metal. During the next three decades, prices as measured by the CPI more than quadrupled, or, put another way, the value of the U.S. dollar has fallen to 24 cents. Meanwhile, the dollar has lost more than two-thirds of its value
The ever-growing budget surplus of the U.S. Government is exciting the spending instincts of most politicians. It stirs their passions and encourages them to find and concoct new spending programs that will tap into the surplus. In defense of their position and income, most politicians are ever eager to take as much money as possible from
Reading an individual’s balance of payments is very revealing. By comparing the income and the expenses of an individual, we can determine the position he or she occupies in economic life. The income ledger discloses not only the height of income but also its various sources. There may be labor income from services we render to our fellowmen, or
These days, most economists agree that the Federal Reserve System tends to expand the US money supply. But in recent years, banks’ share of total financial assets has been declining. In 1980, it stood at 37%, while in 1999, the share fell to below 24%. Does this decline suggest that a major contributor to the expansion of money supply (which
At his Humphrey-Hawkins testimony, chairman of the Federal Reserve Alan Greenspan was asked whether the Fed attaches any significance to the money supply data. The Fed chairman replied that he regards money as an important variable but admitted that he has difficulty in establishing what part of liquidity constitutes “money.” In short, Greenspan
In his book Irrational Exuberance , Robert Shiller, a professor of economics at Yale, attributes the observed stock market mania to investor’s psychology. Shiller believes that stock market players are driven by impulse and herd behavior. The attempt to explain the present stock market behavior by means of these factors presents investors as
The Federal Open Market Committee, the executive arm of the US central bank, has voted to raise the federal funds rate and the discount rate by 0.5%, to 6.5% and 6% respectively. In its press release, the Federal Reserve said, Increases in demand have remained in excess of even the rapid pace of productivity-driven gains in potential supply,
“Electronic money is merely a device for storing information concerning debits and credits. It cannot acquire independent purchasing power; it cannot become money itself.” Many economists and financial commentators believe that in the unregulated market of the internet economy, new forms of money can be created that bypass central-bank and
The Free Market 18, no. 5 (May 2000) Fifteen years ago, Murray N. Rothbard wrote a piece on the most prevalent economic errors of that time. What are the great economic errors alive today? 1. The Fed sets interest rates. The Fed can exercise huge influence over interest rates by setting its discount rate, manipulating the fed funds rate, and
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.